The terms impact investment and social entrepreneurship were coined to define organizations that could reconcile the desire to create an impact while also having a commercial or financial intention. Beyond the intention, these organizations commit to measuring, evaluating, and reporting their impact to drive better decisions and strategies to achieve their social mission. These impact investment generation emerged in Indonesia in the early 2010′. At first, it has remained quite a “niche market” isolated from the mainstream organizations represented by venture capital (VC) firms and hyper-growth tech start-ups.
Since 2015, we have witnessed some exciting trends changing the development of impact investment in Indonesia. Beyond the logical relationship of seeing impact investors investing in social enterprises, we saw mainstream investors (e.g. VC, corporates, private equity firms) also investing in the same social enterprises. Impact investors are not anymore the only ones financing the growth of impact entrepreneurs. In a similar pattern, numerous entrepreneurs not being defined as social enterprises (or not being aware of this jargon) do have an important contribution to impact and the SDGs’ achievement. We see online technology lenders (part of fintech) companies, not calling themselves “social enterprises” providing access to capital to thousands of SMEs, online education models democratizing access to knowledge to the most remote areas unicorns providing additional income to vulnerable people or SMEs.
So the impact investment extended its wings to emerge as a new conception of Investing in impact where this impact becomes an arbitrage, an opportunity, a “new normal”… the smart investment to do on top of the right investment strategy.
ANGIN Team is glad to share some of the latest insights on this investing in impact landscape in Indonesia. For the first report of this kind, our research and investment team analyzed hundreds of transactions, deep dived into investor case studies to extract some of the key trends shaping the market.
We are sure this report will support any organizations and individuals to drive better decisions in supporting the Indonesian SDGs.
