A SOCAP guest post by Carrie Gonnella, Program Director of CASE i3, and Cathy Clark, Faculty Director of CASE and CASE i3
CASE at Duke (Center for the Advancement of Social Entrepreneurship) is an award-winning research and education center that helps leaders scale social impact. As a SOCAP Network partner and Good Capital Project Academic Sponsor, CASE is offering a special discount to sign up for our new Smart Impact Capital online toolkit. Visit www.casesmartimpact.com now and use the code SOCAP17 to get 20% off your individual registration before October 31. If you are a SOCAP Fellow, email sarah@socialcapitalmarkets.net to take advantage of SOCAP’s 100% discount for this year’s Fellows.
Does this sound familiar?
You’re an impact entrepreneur and you spend more time and effort than you can really afford on fundraising. You’re searching for investors anywhere you can think to look, constantly sending emails and leaving voicemails, and flying all over the world to attend conferences and accelerator events to try to make a connection with an investor. AND you’re trying to run and scale an impact business at the same time.
Or…
You’re an entrepreneur mentor or advisor and you’re constantly finding that the entrepreneurs you’re working with are not quite as investment ready as you expected. You often spend your limited time coaching on the basics of fundraising, rather than on the more sophisticated business and capital-raising questions that really benefit from your deep expertise. You find yourself repeating the same lessons over and over again. You’re not spending your precious time effectively or efficiently.
At CASE, we have been that mentor and we have worked with that entrepreneur. We’ve spent 15 years supporting impact entrepreneurs trying to raise capital to scale their impact. We’ve seen the process from all sides – through our impact investing fund case study work, through collecting data on $2.5 billion of impact investments for the Obama White House in support of the US National Advisory Board to the G8 Social Impact Investing Taskforce, and through our five-year accelerator partnership with USAID, where entrepreneurs in our care raised over $50 million in grants and investments.
Our realization?
Simply put, for all the hype and attention around impact investing, impact entrepreneurs are still embarking on the fundraising journey without a guidebook.
When you visit a foreign country, you don’t step off the plane without basic understanding of the language spoken in the country, how to get from one place to another, and where to find appropriate food and lodging. Instead, you use a guidebook. A guidebook is crowdsourced from the experiences of all those that came before you. You benefit from their knowledge, so you don’t waste your precious time rediscovering what others already know.
When it comes to capital-raising, impact entrepreneurs are operating without a guidebook. Most don’t know how to effectively communicate with investors, don’t have a clear and strategic process to navigate this long journey, and don’t have access to time-saving tools based on the experiences of other entrepreneurs. Information about what has worked in the real world is siloed and often out of the reach of the people actually trying to raise capital. Hundreds of entrepreneurs have done this before, and yet every team feels like they are going it alone, inefficiently.
Entrepreneur support programs are working to fill the gap, but they still need tools to lead cohorts across the incredibly diverse impact investing terrain. Accelerators, fellowships, incubators, and university programs aim to help with exactly the issues mentioned above, but we found very few of them have developed formal curricula or tools around fundraising. Peer learning helps, and many programs use mentors and coaches to bring local connections and deep expertise in a piece of the overall market. But something to help efficiently and effectively guide entrepreneurs through the common steps along the way is missing.
Our Solution
Three years ago we set out to try to address these fundamental problems. Our solution is CASE Smart Impact Capital™ – a scalable online fundraising toolkit for entrepreneurs and the support programs that guide them. It’s been crowdsourced from the experience of hundreds of entrepreneurs and investors around the world. It’s designed to help entrepreneurs navigate the fundraising process so they don’t end up with the wrong kind of capital, or the wrong investment partner. It’s the video and tool-based guidebook for the impact entrepreneur’s capital-raising journey.
This toolkit is organized into nine modules, or chapters, based on topics every entrepreneur struggles with. Each module contains bite-size learning videos, downloadable tools, and practical resources to consult any time, such as:
- A practical explanation of the 11 impact capital vehicles now available and rules of thumb to make decisions about them. You can pick up our tool, answer five multiple choice questions, and understand which capital vehicles to avoid or explore further. We also have reference materials on all so you can see examples and tips on impact capital vehicles like recoverable grants, pay for success contracts, debt crowdfunding, and variable repayment loans.
- Investor databases all in one place. We include links to over a dozen free databases, with customized instructions on how to get to what you need to, fast, from CDFI, DFI, foundation, government, fund, to angel investor databases, both global and regional.
- The right story for the pitch. Is this investor impact-first or finance-first? Most are in between. Our pitch guide explains how to choose the right story for your investor meeting, which elements to put in which pitch documents, examples of great and terrible pitches, and why they hit or missed with different investors.
- Pro Outreach Email Templates. Half of the battle, once you know what capital you want, is connecting to the people that can provide it, and today that usually happens through email and LinkedIn. Our toolkit includes templates with specific tips and examples so anyone can write emails to a wider network that are more likely to be answered.
- Finally, a financial model you can explain and adjust with confidence. We got experienced impact CFOs to create an excel projection tool for every impact entrepreneur. Download the tool, watch a few short instructional videos, and you can build a simple yet robust financial model. Several programs, including Uncharted, told us our excel tools are the best they’d seen. Even for entrepreneurs with an already complete model, our instructional videos demystify financial communication so you can understand better what investors need to hear.
We tested these tools and others in the full toolkit over the past year with accelerator programs around the world wanting to give their entrepreneurs a leg up in the fundraising process, like SOCAP, MIT, Investors’ Circle, SPRING, Stanford, Uncharted, and USAID.
What did we learn?
Entrepreneurs said the tools were:
- Self-Paced: Smart Impact Capital is educational, but it’s not a course – it’s an online toolkit to get up to speed on what you need when you need it. As one entrepreneur said, “I usually am a bit jittery about getting involved in online or remote kinds of training because of the lack of interpersonal communication. This was amazing. I could do it at my own pace.”
- Easy to Follow: Sam Gwer, SOCAP16 Fellow noted, “With a non-business background, my experience with the Smart Impact Capital training was amazing, honestly. And I say this because it was broken down in a very simple way that was very easy to follow. There are very well-defined outcomes.”
- Helpful for Team Development: A SOCAP16 Fellow reported, “We revamped our mission statement and are in the process of updating our theory of change as a result of Smart Impact Capital. Additionally, members of our team significantly benefited from Module 3. It was one of the most clear and comprehensive lessons they had used on financial modeling specifically for social enterprises.” Another entrepreneur told us, “Better tools to take to our leadership team to upgrade our language and approach, strategy, and communication to investors in our deck and business model. Revolutionary!”
- Useful Enough to Recommend to Peers: Recent cohort survey data showed the most important results from our pilot: 85% of entrepreneurs recommended the tools to peers, and 95% said they increased their sophistication in raising capital.
Accelerators and Investors said the tools were:
- High Quality and Relevant: According to Abdullah Saqib, MIT’s D-Lab program mentor, “As a mentor, I feel the SIC content is a goldmine, the quality of the content as well as relevance of the tools for fundraising is impressive and spot-on!” Ron Cordes, Co-Founder of the Cordes Foundation and an active impact investor said, “We’re an enthusiastic partner with CASE and will be providing the Smart Impact tools to our Cordes Fellows this year, to give them access to the best tools we’ve seen for how to access impact capital that meets their needs.”
- Scalable: According to Suzanne Biegel, Investment Director of Spring: “We are piloting Smart Impact Capital for the SPRING Accelerator ventures and it is a phenomenal tool for us and for our entrepreneurs. This content is content I and our team would have needed to teach and coach individually for all of our ventures. Now we have a tool that lets the entrepreneurs who are most ready for it have access when they need it, how they need it, and in the time and location that is right for them, at a very high quality, and we can focus on the places where they need our 1:1 support the most. I’m so impressed with this work!”
- Needed: Another partner told us after the first online walkthrough: “You can’t see me, but I’m jumping up and down! This is EXACTLY what we need!”
Plug into Smart Impact Capital. With the completion of our successful pilot, we are excited to formally launch Smart Impact Capital to the public this October. You can plug into the toolkit and tell us what you think in three steps:
Take a test drive: Watch our introductory video to Module 5: Investor Triage to learn the four most important steps to getting to your top investor targets.
Do you want a tool to track your investor conversations at SOCAP? Download our Investor Alignment Tool so you and your team can prioritize your leads. Check out three more free videos available on our website.
- Sign up with our SOCAP discount code before 10/31 Individual entrepreneurs can access the toolkit at www.casesmartimpact.com. The full 9 modules costs $900 – about what you pay to fly to a conference and learn from a handful of people; but our toolkit gives you the knowledge and experience of hundreds. Use the discount code SOCAP17 to get 20% off the full package now through October 31, 2017. Or you can get started with three modules for $375. Support programs can contact us for bulk discounts to integrate the toolkit into your cohort programs and access our detailed curriculum guide.
- Learn something new? Have a resource we should add? Tell us!
Email us at CASESmartImpact@duke.edu and tweet us at @CASEatDuke with #SmartImpactCapital.
Ultimately, we at CASE want to empower all impact entrepreneurs to make their fundraising journey more strategic, efficient, and successful. Why? So you can get the capital you need and get back to the real work–making the world a better place!
