Being Good In Venture Capital

Impact investing and double/triple bottom line funds are the casted as the white hats in venture capital. However, impact investing as a sector has been vague, and provides no guidance or best practices on what needs to be done or measured to be considered impact. There’s also a weird implication, I’ve observed, where any Black or Latinx GP is considered impact simply because of their race or ethnicity.

In DBL/TBL, there’s an assumed tension between the performance measures. For example, if your TBL includes People, Profits, and Planets, there’s an assumption that optimization of 1 part comes at a sacrifice of the remaining parts. Based on this tension, one would have to make a natural compromise to optimize across all 3. Investing for a societal or environmental impact (People or Planet) assumes lesser financial returns (Profits). Raw hypothesis: within a couple of years, this framework will be outdated. We will see new models and frameworks that doesn’t create tension but instead demonstrates investing and optimizing for People/Planet generates the maximum returns.

*late night brain dump, forgive typos

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About Hadiyah

Practicing loving God, neighbors, and myself daily. Leveraging venture capital to advance racial equity at HBCUvc.