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Based on the detailed analysis of the 37 cases, the results of the survey, and information from 180 persons from seven different countries, Latimpacto has identified insights on the investing for impact ecosystem in the region.

These insights undoubtedly provide a series of inputs that will serve to better understand how to better apply investing models that seek to solve social, economic, and environmental issues that persist in the region. They relate to who is an investor for impact, what forms of tailored finance, non-financial support and impact measurement strategies they use, as well as their exit strategies, collaborations, theory of change, among other information.
Investing for Impact

Investing for Impact

  • Few actors recognize the concept of investing for impact and, therefore, even if they are applying its philosophy and principles, they do not normally use this term. There are some exceptions, such as the case of Puerto Asís Investments, a family office from Argentina that complements its investment portfolio with an investing for impact perspective1. Creating a narrative and disseminating conceptual models is an opportunity to consolidate a common language in the region, with which to build a set of principles, practices, and methodology that can boost the impact of the initiatives.

  • Dealing with philanthropy and investment in the same scenario seems to go against the very understanding that some actors have of these two terms. FIS Ameris (Chile) illustrates a perspective that many investors share, namely that they have two wallets: “one to invest and make money, and one to donate and be good people.”2 However, what investing for impact sets forth is that it is possible to manage these two “wallets” in a coordinated manner, to put socio-environmental impact first.

A key link for the continuum of capital

Investing for impact does not replace other social investment models like philanthropy, corporate social responsibility, or impact investment. Rather, it links part of the continuum of capital by identifying new models, validating social and environmental solutions, and mobilizing catalytic capital. Cases like Fondo Acción in Colombia, Conexsus in Brazil, and Promotora Social in Mexico highlight the importance of working across the continuum of capital.

Investors for Impact

Investors for Impact

Investing for impact has greater potential for success when it involves actors with different backgrounds, approaches, and experiences. A foundation’s philanthropic vision is complemented by the focus on results that investors usually have. Financial experts use their knowledge to help adapt funding mechanisms according to their risk profiles and the needs of social purpose organizations, while professional services firms focus on ensuring the sustainability of the SPOs and maximizing the socio-environmental impact. Essentially, the growth of investing for impact and the ecosystem is proportional to the diversity of actors involved and their possibilities to work together.

Not-for-profit organizations lead 60% of the cases researched for this report as social investors; the most striking example is Colombia, where all the cases discussed are set up this way.


The prevalence of non-for-profit entities can be explained by the fact that 16 of the 37 cases are led by foundations, the most representative silo. Financial institutions and asset managers are the second most representative group with 11 cases, followed by companies or corporations with 5, professional services firms with 2, and the academia, family offices, the public sector, and multilateral agencies all with one case each.


Taking the distribution by silos as a reference, it is evident that more actors need to be engaged by collecting evidence of what can be achieved, and by sharing experiences, learnings and success stories from existing initiatives. Engaging new actors in the practice of investing for impact is precisely one of Latimpacto’s key goals.

Some more learnings and conclusions can be found below on each of the silos studied.


  • Foundations play a leading role in investing for impact in the region. Sometimes they bring together the public and private sectors, like Fundación Santo Domingo and Fundación Corona in Colombia, Fundações e Institutos de Impacto (FIIMP) in Brazil, Fundación Colunga in Chile, or Fundación Gonzalo Río Arronte in Mexico. Therefore, boosting the role of foundations may contribute to the creation of links and collaboration among different silos and help to integrate best practices from the public, private, and social sectors.

  • Through the practice of investing for impact approaches, organizations and decision makers linked to the world of traditional philanthropy find new possibilities and tools to increase the impac of their interventions. Nonetheless, given the strong, deep-rooted tradition that prevails in this sector, innovative initiatives are not mainstream yet; they are, for now, an exception to the rule.

Financial institutions and asset managers

  • International investment funds play a key role in the development of the investing for impact ecosystems in each country. They are pioneers that, through their progress demonstrate to local investors that it is possible to design viable social and environmental impact alternatives with financial returns. Acumen in Colombia, NESsT in Peru, or Root Capital in Guatemala are examples of this.

  • Local funds can also be found in the region –some of them are even pioneers in their own contexts– and have effectively involved and connected investors from their countries. Promotora Social in Mexico, Fondo Inversor in Colombia, FIS Ameris in Chile, and Co_ Capital in Mexico are proof of this effort.

  • Banks can also play a determining role when they take risks and offer their services to organizations that are typically excluded from the banking system. An example of this type of strategy is Banco Galicia in Argentina, which acknowledges the importance of its role as a financial institution in the development of the country and therefore offers a special line of credit for triple impact businesses in order to support their growth. Another example is Fundación Bancolombia in Colombia, which plays a key role in that country’s ecosystem by participating to some extent in at least half of the Colombian initiatives reported here.


  • Whether originated from their sustainability departments or is part of an integral part of their business model, companies also stand out as one of the most relevant investors for impact among the cases studied. An example of sustainability is Cemex, in Mexico, which along with Tecnológico de Monterrey provides support to social entrepreneurs and innovators. Brazil’s Lab Habitação, led by steel company Gerdau, is an example of how the company’s business model can be leveraged to benefit businesses with a social and environmental impact.

Professional services firms

  • The two cases in this silo correspond to Brazil. They are Plataforma Parceiros pela Amazônia and Din4mo. Both case studies stand out because of their involvement of actors from other silos and the use of blended finance instruments. This signals that professional services firms can be interesting actors that can involve new organizations and fuel innovative initiatives, due to their specialization and cutting-edge knowledge of certain topics.

Academia and think tanks

  • Academia has yet to get involved more extensively in this ecosystem. They can add great potential value since they can help build the business case and train future professionals. Additionally, it is an actor that can also promote this kind of initiative, as in the Utopía project by Universidad de La Salle in Colombia.

Public sector and multilateral agencies

  • Multilateral and international cooperation agencies and international impact funds, have been key actors by leading initiatives, incentivizing pioneer experiences that serve as evidence, and bringing more actors into the conversation. Cases like the SIBs.CO program in Colombia, where the Inter-American Development Bank and the Swiss State Secretariat for Economic Affair (SECO) have played an essential role, is testimony to this. In this instance, they are not the leading actors but rather support local organizations in their purpose.

  • Regarding the public sector, factors like changes in government ─which on several occasions affect negatively existing relationships ─ or positions held by some representatives regarding the role of the private sector (during the interviews, this disengagement was particularly emphasized in Argentina, Brazil, and Mexico) make their participation challenging.

  • Offices linked to entrepreneurship, cooperation, and innovation in the public sector are usually closer to these conversations, but they cannot always profoundly influence public policy. Work in collaboration with high-level government actors, whether in local or national scenarios, can boost the ecosystem's more active participation. Noteworthy is Ruta N in Colombia, a corporation created by the City of Medellín that plays a crucial role as a market builder and articulator for social innovation initiatives. The participation of national and local governments in Social Impact Bonds in countries like Argentina, Colombia, and Chile are examples of how the public sector is getting involved.

Family offices and High Net Worth Individuals

  • The role of family offices or High Net Worth Individuals is still limited;usually social investments are channeled through family foundations, companies, or corporate foundations. Even so, there are cases like FIS Ameris, where the main donors are high net worth families. However, a particularly relevant case in this study is that of Puerto Asís Investments, an Argentinian family office whose investment portfolio includes investing for impact initiatives.

Theory of change

Theory of change

73% of the cases studied have a theory of change. The organizations or initiatives that use this methodology are more likely to be measured with impact indicators, as this allows them to understand more clearly the problem they address, the long-term impact they want to achieve, and the process and activities that need to be implemented.


Having a theory of change is one of the principles recommended by the European Venture Philanthropy Association (EVPA). This trend is on the rise in Latin America, although it is not present in all of the cases studied.

Sustainable Development Goals

Sustainable Development Goals

The five Sustainable Development Goals (SDGs) most frequently addressed by the organizations that work with an investment for impact approach in Latin America are:

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Sustainable Development Goal SDG 08 Work
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This prioritization reflects the main issues faced by the region and sets the priorities for organizations in their interventions.

If these 37 cases were to be taken as a reference as to what SDGs are priorities for investors for impact, and we compare them with the latest ANDE report
3, we find that SDGs 1, 4, 8, and 10 are also the ones that are most addressed by impact investors (those that seek to make both a financial return and a social impact).

The only difference between the priorities between both investor types is SDG 11, related to inclusive, safe, resilient, and sustainable cities and human settlements, which is more significant in investing for impact initiatives, while SDG 5, related to gender equality is more highlighted in the ANDE report

1 ANDE (2020). Impact investing in America Latina: trends 2018 & 2019.
2 ANDE (2020). Impact investing in America Latina: trends 2018 & 2019.

Tailored Finance

Tailored Finance

Grants are the financial instrument most widely used by investors for impact in Latin America. This represents an important difference from impact investment in the region, where grants do not represent the main financing mechanism, as they seek a return. In comparison, several cases in this study make grants or use philanthropic resources to offer patient capital or to subsidize technical assistance programs5.

This preference for grant-making mechanisms can be largely explained by the large proportion of foundations in the analyzed case studies. However, grants are not exclusive to this silo. An example of this is Gerdau in Brazil, which strengthens small businesses that work on housing-related issues by means of non-repayable grants or seed funding; or Cemex in Mexico, which finances social innovation projects with grants through Centro Cemex-Tec. Another example is Conexsus in Brazil, where grants are used to fund non-financial support offered to entrepreneurs

Foundations also use different financial instruments. IC Fundación, in Colombia, uses debt to finance agricultural associations; Fundación Lemann, in Brazil, incubates social businesses, and Promotora Social invests in social businesses in Mexico. Fundación Corona and Fundación Santo Domingo in Colombia and Fundación Colunga in Chile have been pioneers, along with other partner organizations in their countries, in promoting payments by results.

It is worth mentioning that there is an increasing interest for hybrid financing instruments, as it allows investors for impact to leverage different mechanisms that can be adapted to risk levels and to the needs of each SPO. Acumen uses these hybrid mechanisms to invest in social businesses, as does In3citi in the acceleration of social businesses in Northeast Brazil.


57% of the organizations expect financial returns (Graph 6), yet most do not seek above market returns. In fact, 40% do not expect any type of return.

Only one organization, FIIMP in Brazil, answered that it adjusts return expectations “based on the case”, as it has several initiatives with different approaches.


Among the organizations that expect financial returns, 36% of them wish to recover the capital plus interests comparable to a moderate investment. In comparison, 32% of them just seek to preserve or recover the invested capital. This shows that investors are willing to assume more risk and that their focus is not on financial returns but on the impact they can achieve.

Additionally, 40% of the organizations that expect a return want to reinvest returns into the same initiative (Graph 8). Two examples of this are Fundación Santo Domingo, which reinvests its profits generated from its housing macro-projects in the same community, or Fondo de Inversiones Misionales de Impacto of Fondo Acción, both in Colombia.


Other notable trends in tailored finance

  • The flexibility and design of financial instruments do not always depend on the characteristics of the SPOs; in some cases, the interests and legal structure of the capital provider play a more significant role. There is still an opportunity to design financial instruments that are adapted to the specific needs of each SPO.

  • In cases like Nacional Monte de Piedad in Mexico or Fundación WWB in Colombia, Grants become seed funding to fuel several initiatives.

  • Debt is a mechanism that may provide more significant guarantees at a lower risk for investors for impact, which is why it is frequently used in scenarios where more control over financial results is required. It is also provided to SPOs that their legal structure does not allow equity or do not want to give up control. This is the case of IC Fundación, an organization that supports cooperatives and cannot use equity.

  • In some other cases, the use of equity results from the first investment by means of successful debt, a grant, participation in an acceleration program, or as a mechanism that is established from the start with the purpose of showing a more significant commitment by the investor vis-à-vis the SPO, as is the case of Acumen in Colombia. While sometimes debt is conditional to a board seat or participation in an advisory council of the SPO, equity is more likely to have a higher degree of involvement, which can lead to more collaboration and can signal a longer-term commitment.

  • Hybrid financing is increasingly being used, as it offers the possibility to adapt the investment based on the SPO or reduce risk at different stages. Blended finance, for example, is a trend that can allow greater impact and efficiency in interventions. Payment by result mechanisms, like the Social Impact Bonds used in Colombia and documented in this report in the SIBs.CO case, reflect new forms of investing that bring together the public, private, and social sectors around measurable results. They also help to build evidence-based public policy and decision-making, which is crucial to solving regional challenges.

  • Lending is another alternative that allows investors for impact to use repayments to finance other SPOs. Din4mo in Brazil uses this mechanism for housing improvement.

  • The case of Bemtevi in Brazil is particularly interesting, as it sets rates for its credits based on achieving impact goals. In other words, impact determines interest rates. This mechanism could be replicable, as it puts impact first and is tailored to the SPO.

  • Taking the continuum of capital into account, there is an opportunity for investing for impact initiatives to prepare SPOs - mostly social businesses with a high social and/or environmental impact – to receive higher investments. First loss funds, structured through blended finance mechanisms, can be used to incentivize private investors to take higher risks. These funds could foster greater development of the ecosystem by bringing together philanthropy and impact investment.

Non-financial support

Non-financial support

Non-financial support is part of the essence of this ecosystem, and is one of the main pillars of investing for impact. Many believe it to be as important or even more as financial support, inasmuch as it allows the SPO to build capacity in the long term. In cases like Bemvtevi in Brazil or Fundación WWB in Colombia, non-financial support is a precondition to gaining access to finance.


The bulk of non-financial support is directed as helping SPOs improve their strategy and/or business model, as they can improve the impact and financial sustainability of the initiative. Organizations like Fondo Inversor in Colombia and Fomento Social Banamex in Mexico are examples of this.


Non-financial support is commonly offered collaboratively, and partnerships are established in order to take advantage of each other’s knowledge and experience aimed at strengthening the SPO. In other cases, this support is delegated to third parties, usually accelerators, that are familiar with the local market and can provide SPOs with integrated services. Fundación Sofía Pérez de Soto in Colombia, who did not have prior experience in providing support to entrepreneurs, relied on Taurus Capital to provide business support. In other cases, like Instituto Carlyle in Brazil, this support is provided pro bono through a network of professional service firms.

Impact management

Impact management and measurement

This is one of the great challenges found in the analyzed cases. While 97% declare that they have follow-up and monitoring mechanisms in their interventions (Graph 11), they are mostly limited to measuring outcomes rather than impact.

Surveys are the most common mechanisms used to monitor results and, of the 37 cases, 13 declared to have impact evaluations. On some occasions, investors for impact face a tradeoff between investing in impact measurement or investing more in the initiative itself. Most prefer to invest more in the initiative than in measuring mechanisms. This is an important challenge for the ecosystem, inasmuch as measuring is resource-intensive but can generate key insights that will be useful for achieving the expected impact.


The case of Acumen stands out in terms of impact measurement, which could be a reference for other interventions. They use Lean Data, a mechanism that seeks to put final beneficiaries at the heart of the measurement process and takes advantage of mobile technology to guarantee fast, reliable, low-cost responses. In this way, they do not need to make sizable investments in measurement mechanisms, while maintaining focus on what they deem more important: the social benefits clients receive from the companies they support.


If one of the main approaches of investing for impact is to strengthen SPOs, impact measurement should not only take into account the positive changes it achieves for the final beneficiaries or for the environment, but also the effect it has on the SPO’s institutional capacity.

Findings from this research revealed that measuring SPO satisfaction (Graph 13) is an important opportunity for improvement to be considered both in current and future interventions. This focus on measurement can be useful in order to demonstrate progress and identify how to better support each SPO.

Exit strategies

Exit strategies

Exit strategies are a critical part of the investing process and determine when disinvestment is appropriate, or where the organization has achieved a sufficient level of maturity considered enough to end support.


According to the survey results, 68% of the initiatives in the study have established an exit strategy (Graph 14), but only 35% establish it from the start of the investment. While not defining an exit strategy from the beginning can offer some degree of flexibility, it can also create false expectations by not clarifying when financial and non-financial support is to end (Graph 15). An exit strategy is also useful for preventing dependency by the SPO.

Some investors that establish their exit strategies from the onset rely on the repayment of a loan. Regardless of the financial instrument, some define an approximate time frame that can go from 5 to 9 years to secure other more patient, long-term support.

In some cases, the exit strategy is linked not so much to a specific date but to the achievement of financial, impact or capacity building goals by the SPO. For example, if an organization reaches financial self-sustainability, or it is able to get grants from other sources.


Partnerships and collaboration among organizations

Collaboration among different actors is one of the main characteristics of investing for impact. This is how knowledge from the private, social, and public sectors is acquired and used to design efficient strategies that can result in greater impact.


In 84% of the cases, other organizations are involved in the initiatives (Graph 16), which shows the important role of collaboration. Besides participating in different ways (Graph 17), foundations, companies, and financial institutions also provide co-investments (graph 18).


One of the cases that show the power of collaboration is SIBs.CO, a program that has led the development of two Social Impact Bonds in Colombia and has connected actors from the public, private, and social sectors around two essential purposes: producing evidence around job creation for vulnerable groups and, at the same time, fueling payment by results mechanisms as a viable alternative that offers better guarantees regarding the achievement of the expected impact.


In the cases where co-investments are made, grants are the preferred instrument used (used in 42% of the cases), followed by equity with 15% (Graph 19).


Social purpose organizations (SPOs)

While this report does not focus on SPOs, this actor is an essential agent of investing for impact. Investors for impact highlight the importance of developing a long-term relationship with SPOs, for which trust is essential in order to achieve the expected impact.


In half of the cases (Graph 20), investors for impact seek organizations that have potential to be financially self-sustainable (57%), followed by those who already have a validated business model (24%). Also, only 32% of the cases support SPOs that have reached maturity (Graph 21). This data confirms that investors for impact are more willing to take risks by investing in new ideas.

There are also cases where investors for impact do not support an SPO directly, but rather seek to validate social innovations. This is the case of SIBs.CO, which groups several actors to test Social Impact Bonds. In other cases, they might seek to strengthen ecosystems.


Final beneficiaries

Final beneficiaries

Final beneficiaries tend to be connected to the most pressing issues and needs of the region (inequality, poverty, and education). They also tend to be women, rural communities, people living in poverty, children, adolescents, and youth (Graph 22).

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