We analyzed Hatcher's deal stream as well as third-party transaction records to assess the impact of Hatcher's "impact" choices on the returns of investments. This report examines both ESG (overt sustainability) and impact. We found that the multiplicities of impact-influenced investors were significantly more frequent.
From this, we conclud that the Impact strategies are most likely to be accretive in comparison to common early-stage investment strategies. This post will focus on series A and the earlier investments. Hatcher has sufficient transaction volume to allow us to analyze them.
Our analysis examines the change in value across a period of time, as valuations alter, not necessarily a realized value, as most investments do not realize their value within the time horizon. Based on the amount of time and the new valuations (possibly to 0), if no other applicable signals are available.
The graph below illustrates the impact. We show a analysis of one data view, which includes particular early-stage rounds, relatively recent time of investment, and a 5-year time duration. This is representative of the relative performance among all the views we examined. However, the numbers may be affected by changes in the view parameters.
Impact vs. non-Impact Investor
This report is not exhaustive without the presence of confounding factors. We don't know the purpose behind individual investments and can't compare Impact investment performance with the complementary pool,
There are some signs that Impact investors could be attracted to companies that have already gained momentum, and therefore they are taking a risk on scalability and choosing better ultimate outcomes, but generally paying a cost that could be offset by portfolio gains. However, the performance overall is higher for 'impact touch' companies as a result of both a value multiplication and the long-term perspective.
We found high-frequency venture investors that explicitly refer to "impact" or share similar goals. We are able to identify significant numbers of investments through the use of tags for high-frequency venture funders. We then flagged investment as having a 'known impact investor' or mix, being a 'known' impact investor that is not, or neither.
Many investments are not properly classified since this is not an analysis of the time-in-transaction. However, it's a small sample set and investors who have recently incorporated impact themes tend to be more impact friendly in their older strategies.
Beyond the primary goal of the investor There are many other aspects that can be considered. The increased self-selection as well as scrutiny that comes with aligning with the objectives of the impact investment, even on a fuzzy basis leads to greater focus on feasibility, scalability, team composition and other aspects that could affect the direction of valuation. Furthermore, many of the impact investment topics are likely to have a substantial intrinsic return, too.
In short it is clear that there is an relationship between multiples of Informative post return for investors and an investment focus on impact. Over the medium and long term, this will encourage positive feedback in impact investing which can increase the impact of goals.