Startups, VC

Hard Questions From (and For) Impact Investors

Akshat and I attended ANDE’s Investment Manager training last week in Chennai, along with an impressive, expressive crowd that included representatives from funds, incubators, foundations, family offices, and even one aid agency. At the end of the week our trainer–Grassroots Business Fund’s own Bob Webster–asked us what questions we felt like hadn’t been answered to our full satisfaction. Some of them:

On screening companies and structuring deals, and managing investments:

  • How do you get past major Indian metros and into rural areas to find entrepreneurs?
  • How do you account for social impact in the due diligence process? Do you?
  • How and why do investors choose between investment instruments? (eg debt, equity, quasi-equity)
  • How do investors here value a company, and what challenges do they face when discussing valuation with entrepreneurs?
  • How do you structure a Board of Advisers/Directors? What are you looking for, and what is the expense?
  • How much technical assistance do investors feel is required post-investment? Who should do it? How much does it cost?
And from my favorite category, Other:
  • As an investor, will you create more impact investing directly in businesses or in funds?
  • What do incubators want to see out of investors? What do investors want out of incubators?
  • How can business accelerators play a more active role in supporting funds?
  • There are at least ten groups raising seed funds or building angel impact angel networks. What gives?
  • How will the legal landscape for impact investing change in the next 3 years?
  • Microfinance, social venture investing, seed funding… what’s the Next Big Thing?
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