NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, June 26, 2014

In my first TED talk Defiant Optimism for Development, I had four minutes to convince the world about the benefits of a social stock exchange. Four minutes and four years later, I have created an exchange in Asia which will host a revolutionary financial product to change lives.

In its report Impact Investing: An emerging Asset Class, Global Research, 2010, J.P.Morgan estimated that the impact investment market has the potential to absorb between $400 billion and $1 trillion by 2020. This is a large number to achieve and it would require participation from all investors – especially retail investors.

I am now creating what I believe is the first Retail Impact Bond (RIB) to tap into this new investment base.

The bond, which we aim to launch in the next year, will be between five and ten million US dollars and will float on the Impact Exchange, which I created last July. It will focus on key areas such as clean energy access, sustainable food sources, urban planning, healthcare and education.

Why did I choose Asia? With approximately 700 million people in Asia and the Pacific living on less than $1 a day, social enterprises are uniquely positioned to bring about equitable growth in the region.

The RIB creates a liquid market for public investments that generate social and environmental value. It’s a bit like large scale ’crowdfunding’ as an investment and not a donation and can catalyse the democratisation of social capital markets, shifting its impact from niche to mass.