Module 4 – Impact Enterprises


The investees that receive impact investments are sometimes called impact enterprises; alternative terms that are used include social enterprises, social businesses, or investees, among others.  Impact investments are intentional investments into companies, organizations and funds (which, in turn, invest in companies) that are designed to deliver social impact alongside a financial return.  These investments span a range of sectors, including renewable energy, education, housing, microfinance, agriculture, and many others.  And they involve placing capital, in the form of either debt or equity, in a diversity of organizational and legal structures, including non-profits, cooperatives, and for-profit social businesses.

These investee businesses produce impact in a variety of ways, particularly by selling products or services that meet the needs of low-income populations (e.g., providing access to products/services that were not available before, increasing affordability, reaching low income segments via new sales or distribution channels, etc.), creating employment among poor or vulnerable groups (e.g., employing individuals who face barriers to employment, either directly within the enterprise or within the supply chain), or generating new market solutions or opportunities (e.g., inventing a new technology to prevent a specific disease in rural areas, or providing a mobile technology solution to allow customers to access transparent information on prices and costs).

Investees seek impact investments at various stages of their lifecycle–which include ideation, business model validation, start-up, and scaling–as their needs and opportunities evolve.  In order to receive impact investments, and indeed to improve their own social and environmental performance, investees must devote resources and time to assessing and reporting on the social value their services and products create.  Such monitoring and evaluation systems and practices cannot be burdensome, over-built or too expensive, yet they must be credible, precise and robust.


One such impact enterprise is Farm Shop.  Farm Shop is a social enterprise based in Kenya that uses a micro-franchise model to provide, on a sustainable and affordable basis, smallholder farmers with the inputs and knowledge they require to be productive.  With the support of USAID and several American foundations, the company plans expansion across East Africa and elsewhere on the continent.  Franchisees operate community-level agro-dealerships that offer extension services and advice as well as inputs to local smallholders.  “Drawing on the principles of successful franchising around the world, we are building a franchise network of agri-dealers located in rural, undeserved areas of Kenya”, say Farm Shop’s leaders. “Our retail shops are clean, modern, and professionally managed.  We provide all the tools that smallholder farmers need to be successful, whether that’s high-quality hybrid seeds, affordable financing, soil-testing services, or cutting-edge shop becomes the hub of everything new and innovative in agriculture.”  Farm Shop’s plan for the future is ambitious.  “Our near-term goal is to reach 500 shops in Kenya, serving a minimum of 250,000 farmers and indirectly benefiting at least 1 million Kenyans.  To guide us there we have brought together a team of seasoned specialists and young professionals with the skills and passion to turn the Farm Shop vision into a reality.”


Form small groups; choose a chair and a rapporteur for each group.  Review the Farm Shop case.  Read the Dichter et al article.  Over a 30-minute session, discuss the following questions:  1) As Farm Shop scales up to 500 shops across Kenya, what are the key factors it should consider in strengthening its monitoring and evaluation system and practices?  2) If Farm Shop decides to study the extent to which its franchisees are serving poor smallholders, in what ways could it use the lean data approach reported by Dichter et al?  Record your answers on flip charts or slides.  Your rapporteur will have five minutes to present your responses in a facilitated plenary session.


Amplify. The Ingo Value Proposition for Impact Investing, The Ingo Impact Investing Network, 2016.

Dichter, S., T. Adams and A. Ebrahim. The Power of Lean Data, Stanford Social Innovation Review, Winter 2016, 36-41.

Edens, G and S. Lall. The State of Measurement Practice in the SGB Sector, Aspen Network of Development Entrepreneurs (ANDE), Washington, DC, 2014.

Farm Shop. Website, No Date.

Harji, K. Building the Capacity of Investee Businesses to Create Impact, Presented to the Executive Workshop on Evaluating Impact Investing: Building the Field, Measuring Success, Accra, 2016.

Kubzansky, M. at el. Promise and Progress: Market-Based Solutions to Poverty in Africa, Monitor Group, 2011.

Organization for Economic Cooperation and Development. Policy Brief on Social Impact Measurement for Social Enterprises: Policies for Social Entrepreneurship, OECD and EC, Luxemburg, 2015.

Skoll Centre for Social Entrepreneurship. Zoona Mobile Money: Investing for Impact, Skoll Centre for Social Entrepreneurship, No Date: Bazley, J. Zoona Mobile Money: Investing for Impact (A), Graduate School of Business, Bertha Centre, 2015. And Bazley, J. Zoona Mobile Money: Investing for Impact (B), Graduate School of Business, Bertha Centre, 2015.

Schwab Foundation. Social Investment Manual, Geneva, April 2013.

Trelstad, B. Simple Measures for Social Enterprise, Innovations, 3(3), 2008, 105-118.