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3 Key Takeaways from the Social Finance Impact First Fund Q3 2024 Investor Update

Erin Flaherty

Impact Investments, Climate, Social Finance Impact First Fund

Key Takeaway

This year, the Social Finance Impact First Fund, a one-stop solution for investing in funds that prioritize social and environmental impact, invested in RuralWorks. On a Q3 investor update, we unpacked the fund’s objectives, investment process, current portfolio, and investment in RuralWorks.

Louisa Schibli, RuralWorks’ Director of Impact and Engagement, didn’t realize just how many barriers rural entrepreneurs face until she became one herself. Louisa founded Milk Money Vermont, an equity crowdfunding platform connecting everyday Vermonters to Vermont businesses looking to raise capital.  

The process of starting Milk Money basically opened up my eyes to the needs of rural entrepreneurs. So many of the entrepreneurs were coming in looking for capital, but it wasn't just the capital — it was the capital, and it was the lack of access to knowledge and networks.Louisa Schibli, RuralWorks’ Director of Impact and Engagement 

Now, through RuralWorks, an impact fund that provides essential growth capital to commercially viable, rural businesses that create quality jobs in rural communities, Louisa works to further support rural entrepreneurs. 

This year, the Social Finance Impact First Fund, a one-stop solution for investing in funds that prioritize social and environmental impact, invested in RuralWorks. Jess Brooks, Vice President, Investor Relations sat down with Louisa to talk about the company’s model during our quarterly update call in December. Social Finance President and Chief Operating Officer, Kirstin Hill and Vice President of Impact Investments, Stephen Vicinelli joined the call to describe the fund’s objectives, investment process, and current portfolio. 

Here are three key takeaways from the update. 

  1. The Impact First Fund makes it easier for people and organizations to put their money to work with social innovators like Louisa and the RuralWorks team. 

Through the Fund, Social Finance works to mobilize capital toward pressing social and environmental challenges. By reducing the barriers to impact investing, the Fund acts as a “on ramp” for those who want to deploy capital more impactfully. 

Beyond addressing persistent capital gaps, Kirstin explained how the Fund is also working to define, build, and grow the field of impact-first investing. 

We're excited to be deploying capital in ways that impact people's lives for the better, but also to open our eyes to the possibility of deploying capital differently.Kirstin Hill, President & Chief Operating Officer 

2. A thoughtful, informed, and repeatable approach informs the Fund’s investment process. 

The investment process starts with ideation, as the Impact Investments team leverages its network to research issue areas that are experiencing capital gaps. Next, as the portfolio is constructed, the Impact Investments team negotiates terms, laying out parameters for evaluating investment outcomes. 

We spend a lot of time doing that work to get to know the investment teams, which helps us build out our investment thesis. At the end of the day, that work all pulls together to solve for a target return that we have for our fund, a certain level of liquidity that our investors expect from our fund, and then, most importantly, the impact thesis that we're seeking to achieve.Stephen Vicinelli, Vice President, Impact Investments

The final stage of the process is monitoring and reporting. The Impact Investments team surveys its investments and reports data back to investors through quarterly updates and an annual impact report. 

3. RuralWorks aims to support rural economies while promoting environmental sustainability.  

RuralWorks invests in companies offering a product or service that directly combats climate change or protects the environment, like TimberHP, the first U.S. producer of carbon negative wood fiber insulation products. 

Through its operations, TimberHP has created quality jobs in an economically distressed community in rural Maine — all while producing a sustainable product. This investment is just one example of why it’s so important to empower rural entrepreneurs.  

Louisa said the RuralWorks Investment Committee also investigates each company’s approach to environmental stewardship and waste management. 

At the top level, we believe that rural communities are not only vital to the country's economy, but they're also the forefront of solving some of the biggest challenges we face today.Louisa Schibli, RuralWorks’ Director of Impact and Engagement 

For more information on the Social Finance Impact First Fund, please contact Jess Brooks.  

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