COURSE NUMBER: MBA292T.3

 

This course is cross-listed with the EWMBA Program

 

COURSE TITLE: Money and Meaning:  Sourcing Capital for Social Enterprises

 

UNITS OF CREDIT: 2 units

 

INSTRUCTORS: Jennifer Walske

 

E-MAIL ADDRESSES: walske@haas.berkeley.edu 

 

CLASS WEB PAGE LOCATION: http://bspace.berkeley.edu

 

MEETING DAY(S)/TIME: Tuesdays 6:00-9:30PM for 10 weeks (8/21 – 10/23)

 

PREREQUISITE(S): None

 

CLASS FORMAT:   Join guest speakers from high profile impact investing and venture capital firms, as well as successful social entrepreneurs that garnered capital.  Students will prepare recent cases which profile social enterprises, and the funders that backed them, providing a dualistic view of the funding process. 

 

REQUIRED READINGS There is no text book.  There will be a study.net reader with cases and suggested supplemental readings.

 

BASIS FOR FINAL GRADE.  Class participation, a midterm and final project.  In teams, students will find investment worthy social enterprises and present them to a roster of investors at semester’s end. Midterm presentations will assist students in winnowing down the most likely investments for continued due diligence. 

 

ABSTRACT OF COURSE'S CONTENT AND OBJECTIVES:

 

There are three stages of the investment process that will be covered in this course.  (1) Raising of funds from wealthy individuals or foundations by the impact investor (2) identifying and investing this capital into social enterprises, and (3) ensuring that the performance of the social enterprises meet the original investors’ expectations. This is one of four business schools, in addition to HBS, Wharton, and University of Michigan, that has been selected to partner with Acumen Fund, to ensure a hands-on, current, and compelling look into impact investing.

 

First Module: Sources of Funds and Performance Expectations

·        What does the term “Impact Investing” mean? How does it differ from traditional venture capital or grant making?

·        What are the sources from which impact investors raise capital?

o   Wealthy individuals;

o   Foundations or retirement plans;

o   Fund of funds.

·        What are the expectations around fund returns?

o   What financial returns are normative in this investment sector?

o   What are the common measurements used for social impact?

·        What are other more nuanced expectations?

o   Focus on regions (bottom of the pyramid; international; national);

o   Stage of investment (seed, early or expansion);

o   Co-investors (is having other co-investors a firm mandate)?

 

Second Module:  Identifying Investments

·        How does one source potential investments?

·        How does one qualify these investments?

o   Due diligence.

o   Fit into firm’s investment focus.

o   Deal structuring.

·        What are the expectations for managing these investments? 

o   Field visits, reporting, and board meetings.

o   Network building (referrals for hiring, investors, suppliers).

o   Informal Management Support (ongoing advice and assistance).

 

Third Module:  Exiting the Investment

·        What are the appropriate ways to “exit” an investment?

o   When social ventures are purchased by larger companies, how “social” does the larger company need to be? How do investors and management teams balance financial gains and mission alignment when being acquired?

o   If the social enterprise goes public, how should it be positioned against less social firms? Are there certain indexes or company types that are most important to the impact investor (i.e., the B corporation?), which might aid IPO performance?

o   If the social enterprise stays private – what are other mechanisms for investors to get capital back from the social enterprise?

 

Note:  Student teams will identify two investments that fit in Acumen Fund’s investment criteria by semester’s end.  Feedback will be given by Brian Trelstad, Chief Investment Officer of Acumen Fund, and his team, on these investments. Other impact investors will also serve as a resource for more informal coaching as well, as students identify investment possibilities.

 

BIOGRAPHICAL SKETCH:

 

Professor Jennifer M. Walske is the Faculty Director of the Global Social Venture Competition, and the Director of Social Entrepreneurship at the Lester Center for Entrepreneurship at Haas.  Dr. Walske was recently awarded the Earl F. Cheit Award for teaching excellence.  Dr. Walske also founded Myriad Investments, LLC in 2000, and NVCA registered firm, and serves on boards of directors for both non-profit and for-profit enterprises.  Dr. Walske completed her doctorate in 2009 after a distinguished career in investment banking, where she was a nationally ranked software analyst by Institutional All-American, and was a regular guest commentator on both CNN and CNBC. Dr. Walske spent ten years in Silicon Valley holding various marketing positions within the software industry, prior to her career in investment banking.   Dr. Walske publishes her research on venture capital and venture philanthropy and frequently presents on the subject of social entrepreneurship and impact investing.