The rise of community investing
The way investors make their decisions has changed permanently over the past few years and has no doubt been accelerated by the pandemic. As well as profits and returns, their concerns now contain the impacts on both People and the Planet. The three factors that now make up investor decisions, with Profit adding on to People and the Planet, mean that local firms are now firmly in the sights of investors.
Much of what is normally considered impact or ESG investing is associated with combatting climate change and while that is a key aspect, the change to the local community that a business makes is now increasingly important. This is according to new data from IW Capital which shows that while sustainability is the key concern for investors, community is a close second with 42% of investors looking to back firms that benefit their community.
This shows a clear sign of the increased desire to invest in something which investors will hold a personal connection with, being given the chance to visit their investment into their local community and feel valued when they attend. One prime example of this is IW Capital CEO Luke Davis, who as a resident of Hove, has led a multi-million pound investment and renovation project on the seafront, creating a community hub and world-class entertainment venue known as Rockwater Hove (https://rockwater.uk). Part of this raise was a round open solely to residents which raised over £1 million.
Investing has never been more emotionally charged after a year where the social, environmental and medicinal good of companies has been in sharp focus. Individuals now want to back companies that can prove they are beneficial to the local area, either through employment, redevelopment, or community outreach. This comes alongside what the firm is doing on climate change and carbon emissions which is, as ever, increasingly important. Working with local residents on redeveloping the pub and hospitality venue Rockwater Hove has shown how much people want, more than ever, a place to come together as a community.
This desire to support the innovators and business leaders of tomorrow in helping the fight to be environmentally friendly, and benefit the community, is clear to see from the media and wider public. This is also true of what we have seen at IW Capital, investing in a number of innovative, growing businesses throughout the pandemic with the support of our investor base.