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00:00The investment industry has long been associated with greed especially after the financial collapse in 2008 that brought the global economy to its knees. But that perception could be changing as more companies and funds turn to impact investing and investment that generates financial return and social or environmental good Nancy fund is the founder and managing partner of D.B. L. partners. Nancy thanks for joining us. I want to ask you how do you define double bottom line investing because there's lots of different definitions out there. Sure . It's a new field and a big one. And people have different ideas about it. For us it's simple double bottom line DPL partners is our firm name means that we invest for two bottom lines. The first is the traditional one that I'll be CSC which is to maximize financial returns but we don't stop there. We have a second bottom line in which we are driving social economic and environmental progress in the sectors and regions in which we invest. And we believe that you can do both. There's no concession there's no sacrifice. And in fact that often leads to upside. Nancy I've got the greatest venture investment opportunities lie at the onset of innovation cycles. How do you spot that onset. Well a lot of venture capitalists talk about the ability to to accomplish pattern recognition and that means that you're looking at signs in society and policy and consumer preferences and pricing that really portend a different future . And the art and the science is really the knit that all together . So for example when it comes to price in the solar industry prices have come down 80 percent or so in the past few years . That made it difficult for business as usual electricity models to to stay the same and created an opportunity for new entrants . Similarly in terms of priorities people are much more concerned about what they eat now the nutritional composition the taste the farm to table all of that. So that opens up a whole new side of a pretty pedestrian market for many years . Now food and agriculture and nutrition are really getting a lot of investment. So you just go on and on and and you look at how policy shapes behavioral change you you look at the preferences diversity transparency mobility choice. Those are some of the real changes in terms of where we're heading. And so what you do is you match together declines in pricing with preferences with policy and that's where the next you know the next big companies are going to be found. You know Nancy there's long been a perception out there that double bottom line investing somehow compromises investment returns or potential investment returns. How is UBL breaking down that stereotype. Yeah when we started people thought we were crazy or naive or both. And so it is a perception out there. It's reducing over time and in fact impact investing has never been more popular. The thing that we've been able to do is to create some concrete examples . We've been at this a long time 13 years and so we have companies that we invested in over 10 years ago that nobody ever knew about and didn't really think would amount to much that are now household names. Companies like Pandora Tesla SolarCity and so we've been able to put a face and a stock chart to the idea that there are companies out there that are changing the world but they're also just amazingly interesting companies and can be great investment opportunities. And so I think for too long the field was more theoretical and and it should be this that we ought to do that. And so that made people think well you can't do that because it's different and you're going to reduce your returns. And so we've been able to show people with with kind of new iconic companies for the 21st century that in fact you can do both. And so just quickly you recently wrote that impact investing is wholly based on people. What did you mean by that . Well impact investing. I mean all investing you know who's making the decisions who's analyzing opportunity. But I think there's an extra layer an impact investing because the people have to have an authenticity. They have to care about social change. In addition to having all of the requisite skills and experience to make people money they have to really believe that entrepreneurship in my case and my asset class venture entrepreneurship can make a difference and it can make a difference not just in terms of what business people we admire . But in the shape and fabric of our society and in our future . And so it comes down to people because frankly there aren't as you noted at the onset. Finance has been a more narrow field in in historical terms and so it hasn't had that extra dimension . And so you need people that really feel comfortable crossing the dimension from social change to hardcore financial skills and coming up with this this hybrid that really has so much power to lift us above some of the troubles that we're in and create a way to create to create a business that allows job creation and a way out towards the goal of future .

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Impact Investing: Making Money and a Difference

DBL Partners practices double-bottom line investing which means the venture capital firm invests for two bottom lines - to maximize financial returns and for social and/or environmental progress. Founder and Managing Partner Nancy Pfund is one of the pioneers of impact investing, as one of the first investors in Pandora, Tesla and SolarCity. In an interview with Bloomberg North hosts Amber Mac and Anthony Lacavera, she explains how she looks for the next big companies that will be both successful and change the world. (Source: Bloomberg)

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