Although the impact investing ecosystem may still be nascent, it is growing quickly as more investors seek out companies that both achieve positive returns and influence on the world. In the last year, PitchBook has added features that make it easier for our clients to track impact investors and the companies they fund.
Impact investing defined
‘Impact’ can be a hard-to-define term, but investors tend to agree that it refers to the social or environmental effects generated by an investment. This simple definition has flaws though because impact can vary across business sectors and geographical regions.
Impact investing is a strategy of investing in enterprises, organizations and funds that seek to create financial returns and measurable social and/or environmental impact. In private equity and venture capital, impact investments are most commonly made through the familiar investment structure of closed-end funds.
Measuring impact can also be fuzzy. General partners and entrepreneurs may gather data explicitly required by their investors, create their own impact metrics or utilize established performance-tracking frameworks, like environmental, social and governance (ESG) criteria, United Nations Sustainable Development Goals (UN SDGs), the IRIS Catalog and the GIIRS fund rating.
Impact investing research from our analysts
- Analyst Note: Impact Investing
- Analyst Note: Sources of Impact Capital
- Analyst Note: A Window of Opportunity
Our methodology
PitchBook does not take a stance on whether a fund or investor is or is not impactful. Instead, we track data on funds and investors that tell us they’re impactful. We’re not reinventing the wheel, just tracking the market.
For an investor to qualify as an impact investor, they must invest for financial returns, invest to intentionally create a positive social and/or environmental impact and actively measure the impact that is created. Alternately, an investor can self-identify as an impact investor—and we actively screen to filter out any false positives based on the three criteria above.
How to find investors with a stated preference for impact investing
With PitchBook, you can now see which investors prefer to make impact investments. In the stated preferences section of an investors and buyers search, select ‘seeks impact investments’ from the additional preferences dropdown menu. Once you run the search, you’ll get a list of impact investors that you can click on to explore their portfolio companies, limited partners, fund performance and more.
Are you a PitchBook client? See the impact investors we’re currently tracking.
How to find companies that have received funding from impact investors
PitchBook tracks more than a million companies and over 50 verticals, including impact investing. In the industry section of a companies and deals search, select ‘impact investing’ from the list of verticals. Once you run the search, you can explore a company further by looking at its funding history, investors, valuation, financials and more.
Are you a PitchBook client? See companies that have received funding from impact investors .
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