18 - How Blended Finance is being used to massively scale the amount of capital for impact investments

The Impact Investing Podcast

For all the promise of Impact Investing, the amount of capital flowing into these investments still represents a tiny fraction of the overall pool of global investment capital. There is no single reason for this. However, a meaningful part of the equation boils down to the risk, or rather, the perceived risks of making impact investments. This is especially true when impact capital is financing investments in developing countries.

This is where Blended Finance comes in. In this episode, we're joined by Joan Larrea who is the CEO of a non-profit called Convergence. Convergence was established in 2016 to help support the burgeoning field of blended finance and facilitate more blended finance transactions.

Joan joins us to discuss how a variety of techniques can be used to de-risk impact investments, how that de-risking can attract much larger sums of investment capital, and what conditions make blended finance a viable solution for impact investment providers and investors. For the social finance nerds out there, we get into the specifics of four common blended finance transaction types: Concessional Capital, Guarantee / Risk Insurance, Technical Assistance Facility, and Results-Based Financing. Make sure to stay tuned to the very end when we discuss the trends Joan is seeing and her outlook for the future of this exciting new field.

You can connect with Convergence on its website (they have lots of great stats and educational info!), Twitter, or LinkedIn. You can follow Joan on LinkedIn.