Examining Impact Finance Globally & Locally

by Julia Matsudaira, MBA ‘14 (11/6/12)

Julia Matsudaira, MBA ‘14

Kickoff meeting of SGE club’s Social Enterprise and Microfinance (SEAM) affinity group with Erik Simanis, Managing Director of Market Creation Strategies.

After years working in the nonprofit sector, I chose to pursue my MBA to learn how to more effectively leverage capital that fuels innovative solutions to tackle society’s toughest challenges.  Arriving at Johnson this fall, I have found no shortage of classmates and faculty who share my curiosity about the relatively new but rapidly growing field of “impact finance.”

At the 2012-2013 kickoff meeting of the Sustainable Global Enterprise (SGE) club’s Social Enterprise and Microfinance (SEAM) affinity group in September, Johnson students had the opportunity to discuss the opportunities and challenges of careers in international development from industry insider, Erik Simanis.  Currently Managing Director of Market Creation Strategies for Johnson’s Center for Sustainable Global Enterprise, Erik spent years focused on new business development in emerging markets, conducting research and consulting for business ventures across several continents.

Erik shared his perspective on various paths to a career in international development – whether via private-sector companies, which he said tend to focus more on BRIC countries, or via development organizations, which are focused on the African continent.  No matter the geography, Erik emphasized that working to boost economic development in emerging markets is still focused on building basic infrastructure via energy, water, technology to facilitate communication or access to capital, etc., so various professional and educational specialties will certainly add value.

When asked about the biggest challenges he sees in international development today, Erik stressed that deal flow remains a large barrier to impact.  That is, companies and institutions with limited management infrastructure in place have difficulty leveraging resources – financial and otherwise – to successfully scale and become self-sustaining.  Similarly, investors struggle with creating feasible exit strategies. 

Given my own experience working in low-income communities in the U.S., I was left with the question of where – and how – impact finance fits into the domestic landscape.  With so many reports of uncertainty in the United States’ economic and political future, it seems there is ample opportunity for the private sector to play an even larger role in spurring innovation that brings greater stability, and ultimately create greater economic opportunity, in the U.S. and abroad.

I look forward to continued collaboration with SEAM classmates, the Center for Sustainable Global Enterprise, and the broader Johnson community to decide what our impact will be – this year and beyond.