Luciano Balbo founded Oltre Venture, which is raising funds for social investment in Italy. Oltre Venture is a member of EVPA, Luciano continues to have personal contacts with the founders and with people currently on the EVPA board.
At the time of EVPA’s founding, I was leaving the private equity industry and starting to make some social investments. Doug Miller, whom I’d known for 35 years or so and who was the real founder, was in the same position and he invited me and one or two other people to discuss launching an organisation, just when I was entering the social investment space in Italy, so these two things coincided.
I expected that the discussion would be no more than a brainstorming and what happened after far exceeded that expectation. I immediately understood that Doug’s commitment was so strong that he was not only looking for a brainstorming session, but for collaborators to help him set up the project that was already in his mind. The draft of the project, so to speak, was already there.
I think EVPA’s contribution to venture philanthropy and social investing has been massive, especially in the first four or five years. For me, the most significant achievement is the enormous advocacy EVPA carried out to promote the concept of VP and to change the practice of philanthropy and investment in the social sector. That’s an enormous success. We were the only ones in Europe promoting VP and social investing in a systematic way, so we were really the cornerstone on which this industry was developed. When we started it, it was a new concept. VP has certain rules and these were the things that distinguished it from more traditional philanthropy and this was a major contribution because many players from private equity and venture capital were attracted to social investing. Now the term is widely used, many people say they do VP with a different interpretation from the original one and it’s fine. It has helped to make the practice mainstream and maybe less rigid.
So our concepts were accepted. But now I think EVPA needs to review its initial proposition and its position for the future. We started under the umbrella of VP with a ‘broad church’ approach. I think that approach is nearly impossible now, because social investment, which has become more popular over the last few years, is taking in the enormous amount of wealth that exists and that’s much larger than the amount of philanthropy. For me, VP and social investing are now two separate concepts, the players are different and so on. We can talk together about the social issues we want to tackle, some of them can be tackled with grants, others with investment but in the end, they are two different markets. So while EVPA covers both and can continue to cover both, I think they need to advocate this distinction, not to say that one thing is good, and the other bad but to create a segmentation of the market, to clarify to investors and donors what the different approaches are. The social investment area is becoming so popular that the risk of impact washing is high and consequently the risk of diluting the original concept. EVPA has a key role in advocating the original social intent of social investment. This is it’s task – and it’s not an easy one – over the next few years.