A VC investor’s perspective on Impact Investing : An exploratory multi-level perspective analysis of Swedish & US venture capital regimes socio-technical transition pathways.

Sammanfattning: The topic of Impact Investing has been creating waves and generating a lot of interest in the funding ecosystem with the growth of impact startups & because of pressure from the populace in the face of global challenges. At the same time the field has been under-explored by scholars. The exploration of the investment industry is performed by collecting investors' perspective on the self defined concept of Impact investing. The research attempts to portray the perspective of the established Venture Capital regime on Impact Investment and understand whether it is still perceived as philanthropic endeavors investing in an alternative asset class, suggested by previous academic research or an industry wide transition and change of investment practices as portrayed by the industry research. This study is focused on the Swedish & U.S. Venture Capital regimes. Sweden, a country that has been described as the “Impact Capital”, and the U.S. that represents worlds largest VC capital sector. Semi-structured qualitative interviews were used in this study to explore the industry dynamics using a MLP(Multi Level Perspective) framework. The interviews with VCs help understand the current sentiment on the growth in impact investing and why the Swedish market is seeing an industry-wide transition while the U.S. VC’s treat it as a separate asset class.  The authors identified that the U.S. regime is currently in the emergence phase of transition while the Swedish regime has reached the transformation phase. Additionally four key themes that differentiate the perspective of the Swedish and US regimes were identified; Risk, Profitability, Use-Case & Branding.