Investment

Family foundations and a private investment office get behind big impact investment initiative

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One of the biggest private foundations in the US, The John D and Catherine T MacArthur Foundation, has launched a new impact initiative with the support of The Rockefeller Foundation and Omidyar Network, the impact-investment group of Pierre and Pam Omidyar.

The two foundations and Omidyar Network have set aside initial funding of $150 million to launch the Catalytic Capital Consortium, which will is designed to help address financing gaps in impact investing. The Consortium is specifically designed to fund impact-led initiatives that are not fit for conventional investment.

According to a press release accompanying the announcement: “Catalytic capital is investment capital that is patient, risk-tolerant, concessionary, and flexible in ways that differ from conventional investment.”

To coincide with the announcement, a new report has been released, which focuses on the importance of catalytic capital. It talks about catalytic capital being an essential component to achieving United Nations’ Sustainable Development Goals.

“Catalytic capital is needed for impact investing to realize its full potential,” said MacArthur president Julia Stasch, in a press release accompanying the announcement. “While impact investing is growing rapidly, much of the attention focuses on market-rate returns, leaving a serious gap in financing opportunities for many promising impact enterprises and funds that could help address critical social challenges. The Catalytic Capital Consortium will help more investors appreciate the importance of this type of capital in yielding deeper, more sustainable impact for people and the planet.”

MacArthur, The Rockefeller Foundation, and Omidyar Network are big impact investors and have so far collectively deployed more than $900 million in catalytic capital as part of their broader impact investing efforts. This new initiative will ratchet up funding considerably for this specialist part of impact investment.

 

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