Building Family Economic Security
Lessons Learned from Impact Investing
Ascend at the Aspen Institute and the Program on Philanthropy of Social Innovation are gathering information about investments, tools, and strategies that have proven successful in the impact investment field and can be applied to building family economic security in the United States. This knowledge building effort will capture growing action and interest in the impact investment field and produce a summary of initial lessons learned. The research will also explore strategies to effectively share models – focused on better results for children and families – with field practitioners, foundations, policy makers and impact investors.
Building Family Economic Security
Despite significant public and private financial resources directed toward addressing challenges faced by low-income children and families, 16 percent of all people in the United States were living in poverty in 2012. One million children will be born into poverty next year, and 22 percent of them will not graduate from high school.
Over the last decade, the impact investment field has emerged as a potential breakthrough solution that can unlock new sources of capital and supplement public and philanthropic dollars to create sustainable positive impact, alongside financial returns. Established foundations, private investors, high net worth individuals, and public agencies are exploring new market-based models and solutions that can bring new perspectives and resources to address persistent challenges related to breaking the cycle of poverty. While the field is still emerging, there is an opportunity to review market-rate impact investments and gather lessons learned and best practices that can leveraged to improve the lives of low-income children and families in the United States.
The focus of the project on Building Family Economic Security: Lessons Learned from Impact Investing is to scan the impact investment field, with a specific emphasis on market-rate investments. The Aspen Institute will identify and capture key lessons from market-based models that support low-income families on a path toward economic security and educational success, and produce a financial return. Building on information and insights from the field, we will then propose strategies to share and apply these approaches to enhance current efforts and nurture innovation in the social sector.
Guiding Research Questions
Through a series of scoping sessions, surveys, and in-depth interviews, we will assess the current state of the impact investment field in the U.S. to explore:
- What lessons learned and best practices related to strategies, models, and tools can be distilled from impact investments in education and family economic security?
- How can these lessons learned and best practices be applied to breaking the cycle of poverty for low-income children and families in the United States?
To create strategic recommendations, we will consider:
- What is the effectiveness of different asset classes and tools on a standalone basis and on an integrated basis?
- What is the effectiveness of different market-rate investor types, as well as the advantages and disadvantages of each type of investor?
- What challenges and opportunities exist when considering the regulatory environment and policy implications for market-based solutions and impact investing?
- How do we increase the flow of capital and strategically allocate market resources to support promising and effective solutions to move low-income children and families on the path toward educational success and economic security?