Hatcher's dealflow and third party transaction data were examined to assess the impact of Hatcher's "impact" decisions on the return of investment. For this review we will use the terms impact and ESG together. We have found that multiples are significantly greater for those who are invested in impacts.
These results indicate that Impact strategies can be more accretive than the traditional early-stage investments. This article examines series A and prior investments. Hatcher is the main focus of Hatcher’s activities, and there are sufficient volume of transactions for analysis.
Our analysis measures the change in value over a span of time. As valuations fluctuate, it is not always a real value. Many investments are never realized within this time-frame. We analyze the time elapsed to determine if any subsequent relevant signals are in place and therefore we discount any recent valuations (possibly lower to zero).
The impact is clearly illustrated in the chart below. This is a summary from one data view. We have included early-stage rounds, recent investments and a five-year horizon. It shows the performance of each of our views. The figures are subject to changes in view parameters and are therefore extremely sensitive to the changing circumstances.
Investor against.
This analysis isn't complete with no confounding variables. Because we aren't able to comprehend the intended purpose of individual investments, and are unable to evaluate the performance of Impact investments against the pool of complementary investments,
There are indications that Impact investors may be attracted by entities with existing popularity. That means they might choose to invest in scaling, and pick better results, but You can find out more may also pay a premium that could offset gains in portfolios. The overall performance of "impact touched" businesses is significantly better on both a short-term as well as long-term valuation multiple.
We identified high-frequency venture investors that explicitly refer to "impact" or have similar goals. We were able to label a significant amount of investments using high-frequency investors. We then flagged the those investments as being 'known impact investors or blends, having a non-impact investor or neither.
It is impossible to accurately tag individual investments as this isn't an analysis of all transactions at the moment. However, it's a small selection of investors and those who had recently integrated themes on impact were generally more impact friendly in their older strategies.
There are many factors that are beyond the stated purpose and type investment. More focus is given to the scalability and practicality. It can also impact valuation trajectories. Many of the impact investment topics will yield a high intrinsic value.
In short, there's a strong alignment between investee returns multiples (and impact investment focus). In the long and medium term, this encourages positive feedback from impact investing, which could increase the impact of goals.
