Small fry, big success

A useful playbook for knowing the insides of high impact investing

- MADAN SABNAVIS

THE CONVENTIONALWAY to look at lucrative investment is to judge the potential of a company to grow and make profits in future.

The well-established companies have a track record which attracts investors. But there is another big pie waiting to be explored in the area of impact investing. This is what Mahesh Joshi talks of in his rather interesting book called HIT Investing. The acronym stands for ‘high impact through technology’.

Impact investing is something that has caught on in recent times where investors look at relatively less known enterprises in the private market space that work on technology to deliver better solutions to a wider class of people. In particular, Joshi talks of investments in ventures that affect lives of people in the lower to mid-levels where the impact is significant.

The author talks in detail of eight such ventures which have made a difference to society at large. Hence the names of Quona, Apis Partners, AC Ventures, among others, are discussed in detail, covering their history and motivations. It should be realised that impact investing does get associated with making money and hence is not to be mistaken with donations. In the process of providing funds to these companies, which can be financial services or energy efficiency or new technologies like decarbonisation, a difference is seen in outcomes that benefit society.

In brief the book gets into the psychology of such investing which involves asking three basic questions. How are they doing it? What are the techniques used and what is the secret behind their success? The book hence focuses on the challenges faced, strategies used and finally the performance. This is done separately for all the eight investors.