Mitcham Associates Looks to Invest in Startups Tackling Poverty
Social-impact investing in U.S. based companies grew from $151.9 million in 2010 to $267.2 million in 2014 but there is still a long way to go
Toronto, Ontario, September 28, 2015 (Newswire.com) - Alexander Small - Investment Director Mitcham Associates stated “we are currently looking at various startups in Africa and we are confident we will be partnering at least two by the end of the year” He also said “there are many entrepreneurs doing terrific things that can't get funding, we aim to change that with an approach to social-impact investing that will be a win win for both investor and entrepreneur”.
For years, companies whose aim was to improve the lives of the poor or downtrodden were dismissed as charity work, not for calculating investors. These days, social-impact businesses are increasingly proving to be profitable investments, but many VCs still pass on companies that offer access to the potentially huge market of developing Asian and African nations, where billions of people are poised to enter the middle class with money to spend and access to technology, according to interviews with dozens of entrepreneurs and investors. Mitcham Associates are one of the few that are actively seeking out social-impact businesses.
Mitcham Associates believe if investors can find the same courage to fund social-impact startups that the early institutional backers of the fledgling venture capital industry showed decades ago, social entrepreneurs could have the chance to move the needle on ailments -- poverty, disease and lack of education -- affecting billions of people, and deliver exceptional financial returns at the same time.
Some VCs like Mitcham Associates are starting to show interest. VC investments into U.S.-based companies working on technology for rural agriculture, malaria treatment, water purification, new stove technology, toilets and hygiene, microfinance and other technologies to assist communities in poverty grew from $151.9 million in 2010 to $267.2 million in 2014, according to data provided by Dow Jones for this newspaper. That's a 76 percent jump, but still just 0.5 percent of the $50.1 billion invested by VCs nationally last year.