Impact Investing vs. Venture Philanthropy

As Impact Investing gains in popularity, there seems to be a greater and more widespread understanding of what we mean by it and what it entails. Impact investing seems to have replaced Venture Philanthropy in some respects, however, for many the difference between the two is not very clear. I came across the quote below quote from Investopedia which seems to hit the nail on the head in clarifying the relatively subtle difference, which essentially concerns a difference in priority.

“With impact investing, the investor is looking to make a profit while also having a positive impact on the world in a social or environmental sense. With venture philanthropy, the goal is usually (but not always) to make a profit while having a positive social impact on the world. Impact investing is on the rise while venture philanthropy seems to have passed its peak.”

So, the difference between Impact Investing and Venture Philanthropy is mainly a distinction in priorities. Both aim to both make a profit and have a positive impact on the world, yet, each prioritises this differently. I hope this helps and if anyone has anythings to add, drop us a line in the comments.

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Impact Investing vs. Venture Philanthropy

by Rogier Want time to read: 1 min