society - Jimmy Lustig | Lustig Family Foundation

Iron Man star Robert Downey Jr. has been covertly making headways into the world of environmental research the last few years. In 2019, Downey Jr. founded the Footprint Coalition, an organization geared toward supporting scientific research and sustainability technologies. Earlier this week, Downey Jr. revealed a new arm of the Footprint Coalition at the Davos Agenda of the World Economic Forum: Footprint Coalition Ventures. Downey Jr. explains that Footprint Coalition Ventures will be the investment branch of the organization and that its mission will be seeking out and supporting companies that research sustainability.

Downey Jr. went into further detail on the goals of Footprint Coalition Ventures in an interview with reporters from Fast Company. Downey Jr. explains that creating Footprint Coalition Ventures will put the Footprint Coalition in a better position to help answer vital sustainability questions. Continuing, Downey Jr. says that Footprint Coalition Ventures have two types of funds, one for preliminary investments and the other for subsequent investment opportunities. Furthermore, the company follows a rolling fund investment schedule. In this manner, investors will be able transfer funds to companies on a quarterly basis, making Footprint Coalition Ventures more accessible to different kinds of investors. Downey Jr. adds that such a schedule opens the company to as wide a pool of investors as possible.

Footprint Coalition Ventures focuses on funding companies that research in six areas, including food and agriculture, energy, education, and advanced environmental solutions. Thus far, five companies, including Arcadia Earth and Cloud Paper, have received funds from Footprint Coalition Ventures.

Looking to the future, Downey Jr. says that he plans on using his status as a celebrity to raise awareness on the Footprint Coalition and sustainability ventures in general. While many other celebrities who are involved in similar organizations tend to keep a low public profile, Downey Jr. feels that it is his responsibility to use his platform to influence others. Jonathan Schulhof, who runs the day-to-day business of Footprint Coalition Ventures, points out that the company has used a YouTube video of Downey Jr. detailing the differences between plastic and polyhydroxyalkanoate, a new type of sustainable polymer invented by RWDC Industries, to help woo investors. Schulhof continues that such content can inspire audiences by making something extraordinary seem commonplace.

Investors have the power to improve the world and turn a profit at the same time, they merely need to find the right methods for doing so. Impact investing is one such technique, one that is growing in popularity as more and more people take an interest in corporate responsibility.

How it Works

Impact investing is an investment strategy that focuses on businesses that have a positive impact on the world. Investors look for companies or small businesses that have good environmental policies, provide opportunities to underprivileged communities, or offer other benefits to society. However, they still also look for businesses that can turn a profit.

Both aspects are important because companies need to make money and stay in business in order to provide societal benefits. Investors who turn a profit can dedicate even more money to impact investing or general philanthropy. A talented investor can turn impact investing into a virtuous cycle that provides both social and financial benefits to everyone.

Myths and Misconceptions

There are quite a few myths surrounding income investing. Many of them deal with the potential for profits. For example, some investors believe that impact investing necessarily has lower rates of return than other methods. That is not the case. Investors have reported internal rates of return as high as 34% on their investments, which demonstrates the potential for profit.

Other investors worry that they will need to tie their money down for long periods to see a reasonable return. The average holding period for income investors is roughly five years, which is on par with that of venture capital firms. Investors can expect a reasonably rapid return on their investment as long as they choose their investments wisely.

The Results of Impact Investing

Impact investing really can make a big difference for a community. Businesses that operate in developing nations often need relatively small investments of capital in order to thrive. Those that get the investments provide livelihoods for their workers, who can go on to spend their wages in the local economy. That fuels more growth and encourages development.

Impact investors can also encourage companies to focus on protecting the environment, such as by providing alternative jobs to people who work in destructive industries. Impact investing is getting more popular over time, so it is likely that the positive impact will likewise continue to increase.

Jimmy Lustig is an active philanthropist. He and his wife created the Lustig Family Foundation.

Tag: society

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What is Impact Investing?