New ways to think about liquidity for impact capitalism

This In Session video series highlights exit liquidity options for impact investors with a focus on how to preserve mission through the company’s most important financial transactions.

New Hope Network staff

February 16, 2018

2 Min Read
New ways to think about liquidity for impact capitalism

“Especially in food, impact is the core of part of the brand. Impact is not a drag on returns. Impact is a driver of return.”
—Ralph Carlton, King Arthur Flour

Part 1:  An introduction to liquidity options


  • There are ways to avoid a disconnect between the mission and the exit strategy.

  • What should you think about now to allow more control of your company and its mission in the future?  



Part 2: What distinguishes InvestEco as an impact fund?


  • It’s important to reinvest in he most important drivers of the business and sometimes that is the brand itself.  

  • Investors want ongoing measurements of impact. 



Part 3: The benefits of an employee stock ownership plan (ESOP) 


  • Ownership is captured like a retirement plan.  

  • If you're a mission driven company, ESOP helps you ensure that the mission is carried on and passed with ownership.    

  • The real benefit is cultural, everyone behaves like an owner. 

  • ESOP rewards the company with employee longevity.  



Part 4: What are the benefits of permanent capital as an exit choice for companies? 


  • Permanent capital is not about investing and then flipping, it’s about helping businesses grow.

  • How does a small business prepare for permanent capital investment in the future? 

  • Can your company grow across sectors? 



Part 5: Keeping the mission on the front line 


  • Mission-lock: How to mitigate risk as stakeholders and shareholders evolve and pressure emerges to cut costs and reduce mission. 

  • At the initial investment, it’s important to have an exit strategy.  

  • Become a benefit corporation. 



Part 6: What should companies think about if they want to consider ESOP? 


  • ESOP requires a lot of financial planning beyond infant stage.  

  • The ESOP structure works best in a founder controlled situation. 

  • There are significant tax advantages.



Part 7: The benefits of long-term thinking for mission-oriented businesses  


  • Take a long-term approach when investing in research and development and product innovation.

  • Investing in people and the supply chain takes years to develop. Find a long-term capital partner to back that vision.  

  • Be clear about future, including the governance structure and long-term goals. 


This session—Impact Capitalism: Exiting Differently + New Ways to Think about Liquidity—was recorded at Natural Products Expo East 2017. 

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