By Nicholas Mang and David Breecker of IN Santa Fe and IN Place
The greater Santa Fe region, like most communities today, faces a growing need to develop a healthy and resilient economy, address social inequality and achieve environmental sustainability — needs that have been exacerbated by recession-driven constraints on public and philanthropic funds. The concept of impact investment — affirmative investment strategies aimed at growing social and environmental as well as financial capital — holds great potential for addressing many of these funding challenges. Until recently, much of the focus in this field has been at the national and global level, and not specifically on developing comprehensive local community strategies and infrastructure for impact investment. But that focus is shifting as interest in, and the need for, local economic development strategies grows.
This increased interest in local economic development models is producing an outpouring of new initiatives, programs, literature and techniques around the country. The number of local investment funds has grown in Santa Fe, and enthusiasm about the promise of impact investment is growing. At the same time, however, those involved locally report a number of challenges that are potentially limiting the effectiveness and growth of programs and inhibiting the possible entry of important new players. These challenges, which may be common to many communities, include:
• On the demand side: a need for developing more, and more viable local social enterprises that can be invested into, as well as building entrepreneurial capacity to successfully drive them.
• On the supply side: a need for greater education and capacity building among potential investors to support wise and measured investments that create early successes, develop a base of knowledge and experience, and build investors’ confidence.
• Connective capacity: an overall need for greater infrastructural and shared capacity, to leverage resources and increase connectivity between demand and supply side entities, and all other stakeholders. This could include the development of information sharing networks, local social enterprise networks, policy and regulatory innovations, shared metric systems, new investment pooling vehicles, investment intermediaries, etc.
The IN Santa Fe Experiment
Building upon the unique qualities inherent in north-central New Mexico, in 2012 the Impact Network Santa Fe (IN Santa Fe) initiative was launched by Regenesis Group, the Story of Place Institute, the Santa Fe Innovation Park and a pair of local funders. Their intent was to foster the emergence of an impact investing ecosystem for growing diversified “community wealth” in the region. As the project’s co-directors, we define community wealth through a “five capitals” lens, in which five forms of capital (financial, human, social, built, and ecological) are grown simultaneously from each investment, without any capital being diminished over the long-term. Through a collaborative process, a set of metrics is being developed to assess community-scale impact across the multiple capitals.
IN Santa Fe’s cross-sector, systemic approach was developed through a series of dialogues involving the public, private and philanthropic sectors. The participants offered a number of local impact investment ideas. An organizing team was then formed to identify governing principles and next steps forward. Their intent was to establish a network of partners who could foster development of a vibrant community ecosystem for local impact investing that could leverage social, environmental and economic benefits. Besides building a network of potential social investors who are interested in companies that do social good as well as providing shareholder value, IN Santa Fe is helping launch business startups that engage local values and resources.
“Social entrepreneurship encompasses ideas from triple-bottom-line businesses to nonprofits, from environmentally conscious products to new sustainable methods of production,” said Sean O’Shea, program director at the Santa Fe Business Incubator and co-organizer of Santa Fe Startup Weekend. Startup Weekend is a nonprofit global network where, for 54-hours, developers, designers, marketers, product managers and startup enthusiasts come together to share ideas, form teams and build products. In September 2014, IN Santa Fe partnered with Santa Fe Startup Weekend to offer a social enterprise component to the intensive entrepreneurial brainstorming.
The INSF Social Entrepreneur Fellowship
Also in 2014-2015, IN Santa Fe prototyped an intensive “Challenge” Fellowship program that provided opportunities for visionary entrepreneurs from all areas of the social venture spectrum to seed their projects, learn, grow and develop their enterprises into investor-worthy businesses. Chosen by a panel of judges through a competitive challenge, the selected entrepreneurs worked with a team of topical experts and resource networks to develop integrated business plans that can increase the systemic impact of their startup ventures. Beyond the five-month “challenge” period, IN Santa Fe provides ongoing networking, resource support and promotional assistance.
The first generation of IN Santa Fe’s Fellowship projects:
• Awesome Harvest – An innovative Santa Fe-based manufacturing company that makes recyclable, biodegradable pots for transplanting and growing plants. The pots are currently available at Costco and other retailers.
• Comida de Campos – An Embudo, NM family farm, seeking to keep local farming sustainable and alive as a family tradition, is launching an innovative, farm-to-vending machine venture that delivers fresh, healthy food products directly to work places.
• Tall Foods – A new startup company that seeks to bolster sustainable ranching through farming and marketing of tasty tall foods (aka ostrich).
• Wildfire Network – A nonprofit startup that is developing an innovative social entrepreneurial model for developing capacity to address the Southwest’s looming wildfire mitigation and forest resiliency hazards.
An open web platform to support ongoing development of innovation capacity and other relevant projects, events, information and resources is also being developed, with the support of the Santa Fe Community Foundation.
The IN Place Expansion
We intend to make IN Santa Fe’s process and infrastructure available to other regions that may want to adopt this place-sourced impact investing model, throughout New Mexico and beyond, under the umbrella of an overall initiative called IN Place. Several communities are now under consideration as “Beta sites” for next year.
For more information on IN Place or IN Santa Fe, email info@sfimpact.org or visit www.sfimpact.org
Author Biographies:
David Breecker serves as Co-Director of IN Santa Fe and IN Place, Managing Director of the Microgrid Systems Laboratory, President of the Santa Fe Innovation Park, a creative solutions laboratory, and Principle Consultant at David Breecker Associates, specializing in strategies for business, industry, and economic development. He earned his MBA from Harvard in 1982, and has acquired over 30 years of general management experience.
David was the principle author and architect of the New Mexico Media Industries Strategy Project for Governor Bill Richardson’s office, and the Santa Fe regional TREE plan for renewable energy and sustainability technology-based development; and prepared Santa Fe County’s long-term economic development plan in 2014. He has been a musician, feature film production executive, and writer.
Nicholas Mang serves as Co-Director of IN Santa Fe and IN Place, Co-Executive Director of the Story of Place Institute, and is a Principal at Regenesis Group. His work focuses on developing systemic frameworks for engaging citizens with place, and developing and implementing stakeholder engagement strategies that develop a healthy and viable relationship between human and natural communities over time.
Through Regenesis, an interdisciplinary design team, Nicholas has worked on a range of projects across the the United States and Latin America. Through the Story of Place Institute, a nonprofit he co-founded in 2009 to bring regenerative development work to community and neighborhood-level planning processes, much of Nicholas’s work has focused on Santa Fe and the Northern New Mexico area. Nicholas holds a PhD from Saybrook University.
