ABSTRACT
This chapter uses the lens of venture capital (VC) theory and practice to analyse the development of impact investing and, in particular, those aspects that are focused on equity investments in new enterprises. The distinguishing feature of impact investing is the generation of financial returns alongside the intentionality and additionality of the social and environmental impact and this raises concerns about the aims of this novel investment approach. Just as the formation of the VC industry ushered in a new approach and a mindset towards funding innovation within the hi-tech sector, impact investing has started to adopt the same investment approach to harness entrepreneurship and capital markets to drive social improvement. It analyses how some public financial facilities, dedicated to the development of the VC market in Europe and the US, have created special initiatives for the impact investing segment.
