118 Capital addresses industry-identified gaps in both early-stage financing and human capital.
Financial Gap. Early-stage social enterprises continue to find it difficult to raise capital. Impact investors rarely find the financial returns needed to compensate for the level of risk that early-stage social investing carries with it. This missing space in capital flows has been coined the “Pioneer Gap” and is the focus of 118 Capital investments. Being a social investor and nonprofit with a low-cost structure and a healthy risk appetite, 118 Capital is uniquely positioned to finance and bridge this gap.
Human Capital Gap. The impact investing industry has acknowledged challenges posed by the historic divergence of philanthropy (for social impact) and investment (for financial returns). One such challenge is that professionals have been trained to either optimize impact or financial return. 118 Capital helps to overcome this skills gap by creating and sponsoring a learning-by-doing educational experience where the objective is to maximize both social and financial returns. 118 Capital lies at the intersection of impact and investing.
118 Capital was launched by graduate students at Columbia University as an extension to the activities of the Columbia Impact Investing Initiative (CI3), a student organization dedicated to growing the fields of impact investing and social entrepreneurship.