SoPact: How can you expect investors to fund your project when you can't show them impactful
results?
SoPact: Hi everyone.
My name is Chris Gaines, lead trainer at SoPact, and today, I'll be sharing eight principles
to building an effective impact strategy to get the funding your project needs to truly
make a difference.
But before we start, be sure to subscribe and click the notification bell down below,
so you're always alerted when we release new videos about how you can create a global social
impact.
SoPact: Let's start out with a question about you.
Are you a mission driven organization?
Are you an asset manager?
Social impact fund?
Accelerator?
Do you work with stakeholders like nonprofits or businesses?
Does raising capital play an important role in your initiative's success?
The place to start in all of these positions is your impact strategy.
If you're a startup and you want to raise capital, where do you begin?
You always begin with the business plan.
You formulate your business from scratch, from your team to your marketing plan, to
your revenue streams.
Then you go and build a pitch deck, and you go raise capital.
I'll walk you through all eight steps so you can be fully prepared for when you do go on
to investors.
SoPact: Number one: Don't start from scratch.
Chances are that someone in the impact community has already built out something that could
be useful to your organization.
For example, as an impact investor, you have to look no further than GIIN.
GINN recently released a host of impact themes and IRIS profiles that you can utilize for
your own organization.
Simply pick the metrics that are relevant to your costs, discard the ones that aren't,
and you have a beautiful profile ready to start with.
SoPact: Number two: The theory of change as a foundation.
While the theory of change is something you might not be familiar with, this is an extremely
important foundational element to anyone who wants to demonstrate the evidence of the impact
that they're creating.
The first step to building a theory of change is your impact statement.
Just start by asking yourself the simple question, "What is the problem we're trying to solve?"
Your impact statement is often derived from your mission statement and your vision statement,
but it's very definitive.
Your impact statement will lead to impact, output, outcome, activities, and input.
Building this out creates a systematic theory of change for your project.
You can use our free actionable impact management ebook to go through this process step-by-step.
The link will be in the description below.
The design of your theory of change will lead to principle number three.
Impact metrics.
SoPact: Impact metrics are extremely important in designing a program that creates an effective
change that you desire.
They're also extremely important in communicating progress to funders.
Standard metrics are a great place to focus if you're truly making progress towards your
impact statement.
For example, impact investors often use IRIS metrics, corporations use GRI or SASB to designate
materiality.
While standard indicators are often useful, they're not sufficient by themselves.
Often, many internal impact metrics and operational indicators need to be synchronized before
you can get a true snapshot of what's happening in your impact management portfolio.
SoPact: Principle number four: The quality of your indicators.
The next step in improving and refining your strategy is determining the quality of the
indicators that you've selected.
Ask yourself a few questions.
Are they measurable?
Are they definitive?
Do you have a good balance in your overall selection between quantitative and qualitative
indicators?
These are all important things to think about when you look at how your indicators interact
as a whole.
SoPact: Principle number five: The context of your indicators.
One important thing to keep in mind when choosing metrics, one dataset can be interpreted in
many different ways.
While impact metrics are defined from one particular lens, they might have different
meanings to different stakeholders.
For example, the metric low-income stakeholders could be interpreted differently in different
parts of the world.
Hence, it's very important to specify exactly what you mean in the context of each of your
indicators and metrics.
This means providing definitions, providing help links with context, showing calculations
as to how you reached that specific data point.
Is it low-income stakeholders, someone who has less than $100,000 involved, or is it
someone who has less than $10 million involved?
SoPact: Number six: Aligning with sustainable development goals.
When you finally start reaching out to investors, one of the things you always want to make
sure you do is take into account their perspective.
In this case, sustainable development goals or related initiatives.
Investors are often looking for alignment with their sustainable development goals and
indicators.
In fact, without this alignment, most funders won't start a true conversation with you about
your project.
SoPact: Number seven: Alignment with your impact management project.
Impact management project defines five dimensions that allows both investors and entrepreneurs
to further understand stakeholders, types of impact, depth of impact, contribution,
and risk associated with impact.
SoPact: Number eight, finally, the last and most important principle is to align your
data sources for different programs, stakeholders, outcomes, surveys, and operations with your
selected impact metrics.
Aligning data with your metrics allows you to monitor the progress of key indicators,
build robust impact evidence, and track the outcomes of stakeholders on a regular basis.
The question is, once you've collected all of your data, how do you present it in a way
that showcases impact evidence?
SoPact: Be sure to subscribe and be on the lookout for more videos in the future where
we dive deeper into this topic.
By mastering these principles and building them into your strategy, you will be able
to ensure success for your project.
SoPact: Do you agree with these principles?
Do you have any other ideas?
Leave a comment down below and let's discuss.
We're really looking forward to diving deeper into the impact management community and seeing
how we can work together to build a better world.
We're going to talk about a ton of different topics here on the SoPact channel, so stay
tuned.
Thanks for watching, and I'll catch you next time.