Impact Investing in Spain: an Emerging Sector

Amy Raisbeck (@Amy23160707), Social Sector Consultant, Stone Soup Consulting.

Not all social and environmental problems will be solved using market-based approaches, but society will not prosper if we continue to use philanthropic methods to solve problems that actually have financially sustainable solutions. Spain has a long history of philanthropy, which has in large measure been subsidized by the government, but this approach does not hold up in the current crisis-ridden economic context. An imminent need to change is obvious, in fact, in a recent study published by PriceWaterhouseCoopers and “la Caixa”, the experts assert that the worst is yet to come for the Spanish Social Sector!

Given this context I see the emergence of the Spanish impact investing sector as a positive sign. Impact Investing (also referred to as Venture Philanthropy) is a clear opportunity to create social change in a new way; it seeks to involve new players that traditionally were not involved in social issues, and it places great emphasis on obtaining results and measuring impact.

As shown by last year’s Impact Investment Map, this sector has seen little activity in Spain. For this reason I chose to interview some pioneers of Spanish Impact Investing in order to both recognize their work and hear their opinion about the sector in Spain. I spoke with Luca Torre (LT) co-founder and Co-CEO of GAWA Capital, and with Luis Berruete, Coordinator for CREAS. Their organizations have significantly different models, but have some basic elements in common: they are independent, they emerged during considerably unfavourable economic conditions, they self-classify as impact investors and they aim at developing a financially sustainable model that is attractive for investors.

Given the limitations of the Blog format I will only present an excerpt of the interviews (please click here to read the complete interviews):

1. What was the inspiration that led to your impact investing initiative?

LB (CREAS): We thought of replicating the concept inspired by microcredit: that credit applied in a social context becomes microcredit, so we thought “why not do this with other financial instruments, such as venture capital?” (…), we were not alone (…) we were especially inspired by an initiative carried out at that time by Caixa Catalunya and Acumen Fund in the US.

2. What makes you unique, why would investors give you money?

LT (GAWA): We have proven a solid track-record so far. We built a product with sufficiently low risk (…) but with great “upside” potential. Also, our personal financial incentive is linked to the Fund achieving a certain social as well as financial performance.

3. What has been the greatest obstacle since you launched your Fund?

LB (CREAS): Finding innovative social companies with financially sustainable business models to invest in (…) fortunately we have noticed that there are more all the time.

4. Do you think your activity is similar to traditional venture capital? How are they similar or how do they differ?

LT (GAWA): We have the same rigor in analysing transactions, almost all members of the investment team come from traditional corporate finance careers (…) however, we also incorporate social impact analysis and criteria into our investment decisions.

5. How do you see the impact investment “ecosystem” in Spain? What’s the potential?

LB (CREAS): We have seen great progress in the last 4 years (…) maybe the regulatory framework and accountability issues are yet to be resolved (…) I would highlight a number from JP Morgan’s research that asserts that in 10 years between 5% and 10% of all assets will be invested in impact investing assets, globally. This is an uplifting fact, although I doubt Spain will reach this number.

6. What is your long-term vision?

LT (GAWA): Our vision is to manage a series of funds, each of which is focused on different basic needs that cause poverty. We have started with financial inclusion, but the idea is to gradually open more funds focused on other key issues (such as agriculture, education, health, etc), until we build a kind of “wheel of funds” that reflects the diversity and complexity of the issues related to poverty.

(To read the complete interviews please click here to see specific examples of the types of investments carried out by these organizations you can visit their websites and

As we can see, there is a degree of optimism among the leaders of these independent impact investing organizations in Spain. It is important, however, to be realistic and to understand that the challenges faced by these entities are huge and that results will only be seen in the long term; so, for now, the key is to continue building a robust ecosystem to support the development of the sector, the exchange of information and the dissemination of good practice.


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