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Is "Impact Investing" a Myth? 🌍

{Also published on LinkedIn. Get your copy of Wealth With A Why}


I’ve just finished Kevin Starr’s provocative piece in the Stanford Social Innovation Review: "No Such Thing as Impact Investing." It’s a must-read for anyone who cares about where their money goes.


Starr argues that if it’s a good investment, it’s just "investing," and if it truly prioritises social change over market returns, it’s "philanthropy."


As a "critical friend" to this space, I think he’s right to call out "impact-washing." However, through the lens of Wealth With A Why, I believe there is an important middle path between traditional investment and philanthropy that allows investments to make change happen - especially for those of us who aren't ultra-high-net-worth but want our "some" to matter.


In the book, we introduce the Spectrum of Capital. This framework shows us that it isn't a binary choice between "market returns" and "charity." Instead, it’s a journey of intention where we as everyday investors can identify forms of capital that work best for our circumstances:


  1. Traditional & Responsible: Avoiding harm (e.g., checking your pension for fossil fuels).

  2. Sustainable & Impact-Aligned: Investing in solutions that benefit all stakeholders.

  3. Impact-First & Philanthropy: Accepting higher risk or concessionary returns to catalyse deep systemic change.


For the everyday investor, impact isn't about a private equity deal. It is about aligning your capital with your values. You don’t need to be a billionaire to move your capital toward a thriving future; you just need to understand your "Why."


I agree with Starr: let’s stop pretending every investment is a "win-win" and start being honest about the trade-offs required for authentic progress, and it’s time to move beyond labels. He shows how business and philanthropic tools can work nicely together, especially when new models are given a chance to prosper. It’s about understanding funding’s complexity and the ultimate goal of ‘better’.


I also whole-heartedly agree that philanthropic investment, as he calls impact investing, can be fun.


Explore the roadmap in Wealth With A Why: https://www.wealthwithawhy.co.uk/part-2-explore-the-landscape



Insight from Wealth With A Why

The book emphasises that wealth is not just a figure in a bank account but a tool for stewardship. The goal is to move beyond the "Internal Compass" of personal gain and toward "Capital in Action." By using the Spectrum of Capital, investors can identify where they are comfortable sitting—whether that is simply "doing no harm" via a greener pension or "doing good" through community-led investments.


  • Read More: Explore Part 2: The Purposeful Investment Landscape, particularly the chapter "Exploring the Landscape" which breaks down the different financial products and the spectrum of capital.

Explore More Resources

To dive deeper into how we can bridge the gap between traditional finance and deep impact, check out these resources from our curated list:


  • Adventure Finance by Aunnie Patton Power: This book explores innovative and inclusive funding strategies that align profit with purpose. https://www.adventure.finance/

  • Scaling Impact by Kusi Hornberger: A core reference for understanding how to use blended finance and patient capital to make capitalism more inclusive. https://scalingimpact.co/

  • Unburdened Solutions: For financial professionals looking to integrate these values into client advice. http://unburdenedsolutions.co.uk

Next Question for you: Where do my investments sit on the spectrum of capital? How much time and effort am I willing to put into researching and understanding the impact credentials of potential investments - could I allocate those same efforts toward philanthropic giving to the same or better effect?

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