Why philanthropic investing?
Sustainable funding for maximum social impact
Philanthropic investing may at first sound like a contradiction, but it actually stands for a consistent approach: start-up financing and growth financing for a long-term, constantly increasing, and measurable impact on the fight against absolute poverty. elea directly invests in the development of companies and organizations in developing countries whose activities provide poor people with new sources of income. These investments are predominantly done in the form of shareholding and loans. They integrate the beneficiaries into global value chains either as a client, producer, or distributor rather than as an aid recipient, thereby helping them to benefit from these value chains on a long-term basis. elea supports locally based entrepreneurs that implement economically sustainable, scalable, and innovative models that are focused on the maximization of positive “social impact.”
elea as an active philanthropic investor
elea does not merely regard and describe its projects as investments. Rather, it acts with the attitude, processes, and methods of a professional investor. As an active philanthropic investor, elea accompanies its partner companies and organizations along the path of economic sustainability. It works with them on a gradual, systematic development of professional structures and systems. The goal is that the partner organizations will be able to finance themselves in the long-term and not permanently rely on transfer payments. In this way, elea is constantly creating new opportunities for communities that live in absolute poverty.
Where nonprofit, venture capital, and impact investing meet
With its investment-oriented approach to entrepreneurial philanthropy, elea operates at the intersection of public benefit, venture capital, and impact investing:
As a tax-exempt charitable foundation, elea can focus on the creation of public added value (i.e., the “social impact”) of its investments. elea's funders expect high, sustainable impact rather than a financial return for themselves.
elea can help innovative projects on the road to success in cases where commercial investors consider them to be too risky.
elea stands for a philanthropic approach to impact investing: in the long-term, its partner organizations combine social returns with economic returns. As a strategic investor, elea supports its partner companies and organizations on a step-by-step basis to obtain access to impact capital markets. If a project is successful, elea can also realize a financial return from its investment; in such cases, all returns remain in the Foundation, they are reinvested, and the perpetuation of charitable benefit is thereby ensured.