21 Oct 2013
Moving the Needle
Impact investor Fran Seegull (MBA 1998) takes a for-profit approach to achieve social and environmental benefits.Re: Josh Lerner; Michael Chu; Herman Leonard; V. Kasturi Ranganby Jill RadskenTopics:
by Jill Radsken
Fran Seegull is a woman on a mission, and it started with a paper she wrote at Harvard Business School.
A lifelong passion for philanthropy brought Seegull (MBA 1998) to HBS, to see if she could mobilize the business world to adjust its thinking on socially mindful investing, also known as impact investing. "I wanted to understand how to use the financial capital markets and for-profit mechanisms to move the dial on the world's most pressing problems."
Seegull had a unique perspective from an early age. Very sick as a child, she says the experience of frequent hospital stays and doctors' visits showed her the health care system up close. "I realized that I really wanted to make a difference," she recalls.
At Harvard, this self-described "contrarian" recalls having to push her idea of promoting social and environmental value "in an educational environment more focused on maximizing shareholder value." Specifically, a class taught by Professor Josh Lerner on venture capital prompted her to write a paper on the nature of value.
"I wrote a paper calling for a different kind of value creation—one focused on social and environmental returns, in addition to financial returns." She notes that while Lerner "didn't agree, he gave me a nice grade on the project."
The paper formed not only her thinking, but became a blueprint for her career. She has spent almost all of it consulting to, operating, or investing in mission-driven businesses that are decidedly for-profit.
She began to make her mark as vice president of business development at Novica, in Los Angeles, an e-commerce company that connects artisans in developing countries to businesses and consumers in the US.
"It's an innovative example of how to use a for-profit business model to bring wealth to those at the bottom of the pyramid," she says.
In 2002, Seegull left Novica to consult at various impact enterprises and several philanthropic family foundations. Four years later, she joined Funk Ventures as COO and managing director. "We invested in clean technology, sustainability, and wellness and medical technology—always seeking to maximize financial returns while delivering social and environmental impact."
During her time at Funk, she connected with the Calvert Foundation, a non-profit investing institution providing financing to under-served US and emerging-market communities. Seegull coauthored a policy paper, funded by the Rockefeller Foundation and others, focused on engaging the federal government in impact investing to achieve social and environmental outcomes. "That opened my eyes to the world of Washington—how we could partner with the federal government to reach mutual impact objectives," she observes.
Seegull brought her knowledge of how to amplify the power of impact investing to her current position as chief investment officer at ImpactAssets, a $100 million donor-advised fund that invests capital for social and environmental impact, through public and private debt and equity options.
That position took her on a trip to Kenya this summer to search for investment opportunities—including microfinance, sustainable agriculture, clean cook stoves, and urban sanitation—viewing them through a gender lens, noting "Former Secretary of State Hillary Clinton has talked about how the GDP of a nation correlates directly to the health, education, and productivity of women."
Seegull, who lives in Santa Monica, California, and is a ranked beach volleyball player, recently returned to HBS for an inspiring 15th reunion, where she found the "HBS needle" has moved: "Impact investing is on the HBS radar now," pointing to the School's Social Enterprise Initiative and faculty such as Michael Chu, Kash Rangan, and Dutch Leonard.
"Things are starting to click at the School." she says. "Fifteen years after feeling I was out on a limb, writing and talking about social and environmental impact, I was asked to join an alumni panel discussing impact investing. Reunion attendees and some professors were quite engaged. That shows real movement and commitment."
It's not just her vindication—it's her vision: "We are shaping and creating a new industry, and it's an engine for change."