Gaining Experience in Impact Investing

Berkeley-Haas Education Team at MIINT

A Move into Impact Investing

My momentous experience with the Haas Impact Investing Network (“HIIN”) started in late September. I came to Berkeley-Haas to pursue a career in impact investing, so HIIN was an obvious decision. At work, I was frustrated with the nonprofit funding model – I had an undergrad degree in finance and I wanted to incorporate social impact into my work – a career in impact investing was a natural fit. However, I neither had the experience nor the tools to make this change. I quickly learned that HIIN was much more than just another case competition. My HIIN experience provide the tools I needed to make a career switch into impact investing.

HIIN is the Berkeley part of an experiential training program called the MBA Impact Investing Network & Training (“MIINT”). It’s an international competition where MBA teams from the US and Europe spend 6 months going through the impact investing process. Teams identify, conduct due diligence on, and recommend for investment an existing early stage for-profit organization that is building social impact into its business model and is looking to raise funding in order to scale up. The winning companies receive seed investments as part of an existing funding round. In addition to the competition component, MIINT provided access to various online and in person trainings on the stages and nuances of impact investing. The competition provided access to professionals in the industry both in formal speaker and panel settings to informal lunches and coffee chats. Furthermore, the competition provided access to networking both internal and external to Berkeley-Haas. I was able to connect with fellow students interested in the same topic. Soon it became an addendum to my MBA curriculum.

Focusing on Education

I joined the MIINT education team based on my personal interests. The first step was to source a company that fit a robust set of criteria. Our team assessed over 50 companies in the education space. I was doing research for the competition that allowed me to learn more about the education industry in the US. I learned about various tools for students, teachers, administrators, professionals, etc. I learned about trends such a mass open online courses (MOOCs) and adaptive learning platforms. Ultimately we decided to work with an organization named KickUp, an analytics platform for school district directors to better tailor the professional development teachers. We worked closely with Jeremy Rogof, the founder and CEO, to analyze the market, understand the value proposition, conduct financial and social due diligence. Through this deep dive into the company, I came to understand the challenges of creating a company that provides a differentiated value and a social benefit in a market that is willing to pay for this product.

Haas Impact Investing Network Fellows 2016

My first wake up call came when we presented the company at the Berkeley-Haas investment committee presentations. We believed the company was strong, the team was qualified and the product and impact were clear. However, the probing 20-minute Q&A following our presentation strongly challenged our assumptions and highlighted weaknesses which we had failed to discover. Ultimately, KickUp’s strong value proposition that addressed a massive problem in public school education today allowed us to win the local round. We represented Berkeley-Haas at the final round at Wharton. We spent the next three weeks engrossed in research, interviews and further analysis to develop answers to the gaps the judges had identified. Our further work proved to us that KickUp was a strong investment and we presented the company to a group of investors at Wharton.

The MIINT Finals at Wharton

The two day competition in Philadelphia was a fantastic experience for the whole team. The first day consisted of coffee chats and networking events where we met the other teams and judges. Their credentials and level of commitment to the tournament were impressive. The second day consisted of the final investment presentations. We spent weeks honing our presentation and were excited to show it to the judges. In our final presentation we felt we did a good job describing the company and answering the tough questions that followed.

In the room where it happens. #MIINT2016 investment committee deliberates on wining team, led by @trelstad pic.twitter.com/LgnIA36F9C

— brianwalsh (@brianwalsh) April 9, 2016

In the end, we were not victorious. As the day wrapped up, we were awed with a presentation which showed what happened with previous winners, including Learnsprout who were acquired in a multi-million dollar deal by Apple earlier this year. Even though it didn’t win, hopefully KickUp will enjoy similar success!

Although we did not win, the experience was invaluable. Our team learned a great deal about the impact investing space, how investments are sourced, studied and eventually executed. Classes are great at providing concepts, tools and frameworks, but it is opportunities such as these that allow students to take their learnings and apply them in the real world. It was also wonderful to work closely with passionate MBAs from four continents, as well as an inspiring entrepreneur, and learning so much in the process. It is countless such activities that makes Berkeley-Haas a truly experiential program.

 

Making it Real – Seeing First Hand the Impact of Your Work

By Alex Levy, MBA 17

Alex Levy

I’ll admit it. When I woke up to the sound of my alarm and driving rain early on a Saturday morning, I had a strong urge to hit snooze and roll over. I was scheduled to be at Bay Leaf kitchen, the non-profit where I’ve been serving as a non-voting board member for the past few months, in an hour to volunteer at one of their cooking classes.

As I lay in my bed, I realized that it wasn’t just my grogginess and the dread of rain keeping me under the covers. I was nervous. I was planning on driving to an unknown part of SF that people often say is dangerous. I was going to be working directly with kids during a cooking class and helping shape their relationship with food. I was stepping into an uncertain situation, and my half-awake brain searched for excuses.

Despite the rain and the uncertainty, I was able to wrest myself from bed and make the drive over to the Bayview. I would be helping out with the Roots class, which is a weekend class taught by Bay Leaf Kitchen to help 3-5 year olds learn cooking basics and develop a love for food early. The underlying rationale is that if these kids develop a connection with their food from a young age, they are much less likely to eat processed foods and develop metabolic disorders.

“I was blown away by how curious and excited these pre-kindergarteners were about carrots and grapes.” Alex Levy re @BayLeafKitchen

The class was a remarkable, eye-opening, and fun experience. I was blown away by how curious and excited these pre-kindergarteners were about carrots and grapes. One student, Becks, had developed a particular affinity for chard, and set about creating a chard salad with lime and sesame seed dressing. The result honestly tasted like something you’d be proud to serve to houseguests, if not something you’d be served in a New American restaurant. As the students shuttled between the cooking area and garden, seeking out particular vegetables and herbs, I couldn’t help but be excited by these kids’ enthusiasm for healthy and fresh food.

Jr. Chef Helpers via BayLeafKitchen

The 3-5 year olds were assisted by another group of students, which Bay Leaf refers to as Junior Chef Helpers. This group of middle-schoolers has been through other Bay Leaf programming, and came to the Saturday classes to mentor the younger group. These Junior Chef Helpers were amazingly patient and thoughtful in guiding and instructing their young mentees, and they were clearly excited to cook and create an awesome, nutritious lunch. It was plain to see how this type of mentorship could create a virtuous cycle; the Junior Chef Helpers gained further confidence and excitement, and the younger “Roots” looked up to this group, who in turn reaffirmed their budding love for cooking and fresh produce.

After the Chard salad and cauliflower stew, the fried potatoes and cauliflower grape dessert had been cooked and consumed, and the makeshift kitchen cleaned and packed away, I was incredibly recharged about the Bay Leaf mission. I had always believed that cooking education could positively impact health, wellness, and nutrition in children, but seeing the impact on individual 4-year-olds made it real.

https://twitter.com/bayleafkitchen/status/702325858795520001

One of my goals when I started at Berkeley-Haas was to develop a lifelong habit of community service. I joined Bay Leaf’s board through the Berkeley Board Fellows program to work towards this goal. Previously, I had done plenty of community service on a one-off basis, volunteering in soup kitchens, food banks, and nursing homes. I had trouble sustaining this involvement, so I thought that getting involved at the strategic levels of a non-profit might be a great way to develop personal investment and long-term involvement. What I realized was that to truly feel invested and involved, I need both. I enjoy being part of the board-level discussions, but also felt tremendous satisfaction helping a small group of 4-year-olds for two hours on a Saturday morning.

I’m ecstatic that I got out of bed that Saturday. I feel a renewed sense of engagement with Bay Leaf, and got some great chard salad too (thanks Becks!).

Recruiting MBAs for Social Impact Internships

MBA Intern at SMASH Academy

Berkeley-Haas MBAs want to have a positive impact on the world. For some of them, the time to start is now, not after graduation or a “first career” in corporate America. That desire translates into an opportunity for nonprofit and social enterprises to recruit and hire MBAs as summer interns. If your organization has a tough, strategic project that could use a smart, energetic, passionate MBA from a top program, now is the time to recruit.

Top graduate programs, including Berkeley-Haas, are seeing an increase in socially-focused MBAs. Is compensation too large an obstacle to be competitive? The answer is that there is no answer. Some large nonprofits can provide top pay, while others struggle to provide even a transportation stipend. Students are attracted to the full package; an interesting project, a strong organization, a unique experience, leadership development opportunities, work aligned with their passion, as well as pay and benefits.

The first step is creating a strong job description to market your project and organization. Some things to remember when creating a job description for MBAs:

• Put the impact of your work and/or the strength of your organization front and center.
• Link the expected outcomes of the work/project to the impact and mission of the organization.
• What experiences will the candidate gain from the position that are unique or valuable?
• Does the role create an experience with something new or innovative?

Social Impact Consulting Panel

Photo by Bruce Cook

November 9, 2015

The annual Social Impact Consulting Career Panel broke our own speaker series attendance record this year! It is always a popular event, and this year more than 100 people filled the room to hear the perspectives of the accomplished panel members. The all female panel was made up of distinct leaders in the social impact space and moderated by Kimberly Wright-Violich, the co-founder and managing partner of Tideline.

2015 Panelists:

• Alison Colwell, Associate Director, Advisory Services, BSR
• Jennifer Kawar, Chief Investment Officer, Nonprofit Finance Fund
• Willa Seldon, Partner, Bridgespan Group
• Laura Tilghman, Senior Consultant, FSG

A National Network of MBAs Working for Impact

The MBA experience is made richer through the networks students are able to create with other socially minded peers. To facilitate these networks, on Thursday, June 25, 2015, Berkeley-Haas’ Center for Social Sector Leadership (CSSL) and Center for Responsible Business (CRB) partnered with IDEO to bring together current MBA students from around the country who are interning in the San Francisco Bay Area. We provided them a chance to meet, spark conversation, and maybe build connections that would uncover the next idea or collaboration in social impact.

The only kind of networking you can find me at. https://t.co/w4jde1w9qw

— Nikita T. Mitchell (@NikitaTMitchell) June 26, 2015

The partnership with IDEO furthers our strong connection with the innovation company. Tom Kelley, MBA 83, was Berkeley-Haas’ first Executive Fellow and returns to campus to speak to students, faculty, and staff through the flagship Dean’s Speaker Series.

Ben Mangan to Lead the Center for Nonprofit and Public Leadership

By Nora Silver, Faculty Director

“We commit to take action.”
That’s the title on the certificate Ben Mangan is holding as he stands beside Bill Clinton at the Clinton Global Initiative in 2013 (pictured below).

Ben brings that promise of action to his new role as the 2nd executive director of the Center for Nonprofit and Public Leadership at the Haas School of Business, UC Berkeley.  He was chosen from among an exceptionally strong candidate pool. Exciting ideas Ben brings to the Center include:

• democratizing social entrepreneurship by providing access to Center resources for budding, but still unknown, social entrepreneurs around the globe
• becoming a regular destination for top talent – inviting visiting fellows from industry to teach and learn with students
• applying lean launch principles to social start-ups
• offering groundbreaking social impact convenings and executive education

Brent Copen recognized for outstanding teaching

Haas Lecturer Brent Copen, CFO of Asian Americans for Community Involvement, was named to the latest Berkeley-Haas “Club Six”.

Based on written student evaluations, the “Club Six” ranking is a key metric used by Haas to measure the teaching performance of its instructors. It means that students in his class rated his teaching 6.0 or above on a 7 point scale. Despite his busy schedule, he teaches the Nonprofit Finance course for both full time and part time MBA students.

On his commitment to teaching, he says:

“I find it personally rewarding to help students appreciate the complexities of the nonprofit business model – as well as what is required to move an organization ‘from good to great’.”

His favorite part of working with students:

“I enjoy sharing some of the practical tools and approaches I have picked up over the years that will help students – as future nonprofit leaders – analyze and act upon financial information as part of an overall approach to strategic decision making.”

Why MBAs are important to the social sector:

“As future board members and senior managers, MBA’s bring the financial background and the business acumen that many nonprofits need to realize the double bottom line of mission impact and financial sustainability.”

Brent brings more than 15 years of nonprofit experience into the classroom, including management roles at the Nonprofit Finance Fund and La Piana Consulting. He is committed to strengthening the sector by helping nonprofit organizations develop more robust financial management practices.  He has presented hundreds of workshops and trainings nationally to executive directors, board members, funders and future leaders. He has also consulted extensively to a wide variety of nonprofits across sub-sectors.

Brent will also publish a new case study for the Berkeley-Haas Case Series later this month.

 

 

Independent Research Study Initiative by MBA Gordon Chan

Haas student, Gordon Chan, MBA ’12, conducted an independent research study to understand the distinct strategies and capabilities for growth of nonprofit organizations.

Gordon stresses that not all nonprofit organizations can sustain growth with the same strategies and structures and chose to divide the sector into three specific segments. He defined these segments as the following:

• Customer-oriented organizations: In these organizations, the beneficiary of the product or service is the same individual as the funder.
• Beneficiary-oriented organizations: In these organizations, the beneficiary of the product or service is separate from the funder.
• System-oriented organizations: These organizations serve other nonprofits and seek to enable or coordinate the work of others in the field.

Gordon divided the nonprofits with the highest revenue growth between 2007 and 2011 into these segments. He then interviewed the selected organizations to identify key differences in strategies, decisions, and circumstances for growth in the three categories. Here is a summary of his findings:

• Customer-oriented organizations clearly adopted a more intentional and proactive approach to growth given their experience was overwhelmingly part of their internal plans and growth for these nonprofits is usually an internally generated effort.
• Growth among beneficiary-oriented organizations is usually externally driven and focused on one program within the nonprofit at a time.
• System-oriented respondents strongly agree that they will have to significantly change their organizations to sustain their growth suggesting that they reach for a diverse set of opportunities as they arise from a collective effort of multiple parties.

Following is a chart that summarizes the self-reported ratings of characteristics of the organizations.

Self-reported ratings on characteristics of non-profit organizations by category.

Gordon was pursuing an MBA in order to make a career switch into the social sector. The classes and programs offered by CNPL became a factor that set Haas apart for him. Once at Haas, he was very involved with the Center, taking many classes, becoming involved with the Berkeley Board Fellows program, and attending the Schwab Charitable Speaker Series events. In his final semester at Haas, Gordon completed this independent research study with CNPL, working closely with Director Nora Silver and several other professors.

Here is a link to Gordon Chan’s full report:Different Paths to Hyper-Growth in the Nonprofit Sector

Berkeley-Haas MBAs lead as Net Impact Vice Presidents

Welcome Alma Rico, MBA 14, Net Impact Co-VP Nonprofit and Public Leadership

“There is a wonderful social-impact vibe at Berkeley-Haas. It was important for me to get an MBA instead of a graduate degree in a field like education. I believe that business skills are essential to the future of education, especially when it comes to some of the more innovative education organizations that are being developed.” Alma Rico was a consultant in the aerospace and defense sectors, but after serving for several years as a volunteer tutor, decided to merge her business expertise with her passion for lifting academic achievement among low-income children and minorities. This realization led her to Berkeley-Haas, where she is pursuing MBA studies with a focus on non-profit and entrepreneurship opportunities in the education sector. Alma knew she wanted to be deeply involved with the Center for Nonprofit and Public Leadership and saw the Net Impact Co-VP position as an opportunity to help the Center better connect the MBA community to the social sector. At Haas, Alma serves as a Board Fellow for Leadership High School and is a team lead for a Social Sector Solutions consulting project with the Hispanic Foundation of Silicon Valley. She is a co-founder of Young Education Professionals-Bay Area and served as a volunteer teacher with Citizen Schools.

Welcome Christine Chu, MBA 14, Net Impact Co-VP Nonprofit and Public Leadership

“I came to Haas because I wanted to make a difference in the world and I knew that I could gain the experience and leadership skills at Haas to do so. I plan to work at a for-profit company upon graduation, but I wanted an avenue to explore and to have an impact in the social sector during my time at Haas. As VP of Non Profit and Public Leadership, I have the opportunity to help connect current, prospective, and past students to new and on-going opportunities as well as to help develop and grow the program.” Christine Chu is a first-year MBA-MPH student focusing on healthcare technology innovation. Having volunteered throughout her life with various organizations, Christine was previously involved as an Event Manager and Fundraising Lead with the San Francisco One Brick chapter, which provides support to local non-profit and community organizations. At Haas, Christine is co-President of the Haas Wine Industry Club and Haas Culinary Club and serves as a team lead for a Social Sector Solutions consulting project with the Coalition for Compassionate Care of California. Christine also holds leadership positions in the Haas Healthcare Association and Challenge For Charity (C4C).

Alumni Spotlight – Liz Rockett

Name: Liz Rockett, MBA, MPH ‘10
Role: Director, Health Practice
Organization: Imprint Capital Advisors
Website: http://www.imprintcap.com/

Imprint Capital Advisors builds and manages mission-driven investment portfolios for institutional investors, helping clients successfully develop, execute, and maintain investment strategies that leverage capital for social impact. Their steady growth across sectors and asset classes is fueled, in part, by Liz Rocket’s leadership of the Health Practice. Impact investing in healthcare is more than a ‘good thing to do’ – the impact lens of better health at lower costs is increasingly a smart investment thesis for healthcare investors.

On how I got to where I am today:

Before Haas, I was a product manager for hospitals and clinical IT. I expected to do something similar after graduation – working with a startup or within strategy of a larger company to launch new products. But Haas introduced me to so many people, so many new ideas, I’ve found myself drawn to helping others do what they love. To me, a big part of investing is just that – support people who are doing what they love, help them achieve greater impact and returns than they could alone. Now I work with clients to identify and pursue investment opportunities that improve health, improve the quality of care and reduce care costs. Fortunately for the MBA-wired portion of my brain, the overlap between the for-profit industry and the social sector in healthcare is richer today than at any time in the recent past.

My involvement with the Center for Nonprofit & Public Leadership:

I was in Social Sector Solutions, and had the good fortune to be a Board Fellow at the YMCA of the East Bay. The luminaries who came in through the Schwab Charitable Philanthropy Speaker Series – leadership of Whole Foods, the X Prize, leading foundations – were some of the most thought-provoking events I attended at Haas. What’s most amazing to me about the work of the Center is that my experience is typical. Life at Haas involves thinking about social impact. It’s in the water, and that’s a tremendous asset for the school.

Advice for current Haas students:

By virtue of the innovations you’re likely to pursue, you may encounter dismissive or skeptical people. Take that challenge head-on, Haasies. Advocate for your point of view and do amazing work. If the skeptics turn out to be right, you’ll gain knowledge needed to get back in the lab and cook up the next thing. Change the world. It’s a hot mess, and it needs changing.