Andrew Greer

Andrew Greer is Purppl’s Managing Director & co-founder, and the Interior Lead of Thrive Impact Fund

“We can’t Capitalism our way out of Capitalism,” were my words to a Zoom room full of social purpose leaders this past spring while sharing about Purppl’s path to taking on investment.

Capitalism is a major contributor to inequity, lack of affordability, climate change, and more. As a social enterprise, how do we reconcile with raising investment (an extractive mechanism) when we are on a mission to build a sustainable, regenerative, and just economy anchored by a formidable social enterprise community?

It’s been a years-long journey to really see that raising capital can help build, stabilize, and scale (wide or deep) solutions to systemic challenges.

So, how did we (Purppl) and how do other social enterprises get past this philosophical challenge, and the real systemic barriers to raise investment capital? Here’s the journey so far. 

“Raising capital is kinda scary and it kinda sucks.”

Let’s start with the obvious. Raising capital is kinda scary and it kinda sucks.

First, you have to build the courage to ask someone else for money. You need to have a business model in place that can clearly show how you will pay it back with some sort of interest, premium, or financial return. There’s also the brutal privilege, capitalism, and colonization dynamics that usually put power over you in a relationship with an investor. 

When we contextualize those dynamics within the work of solving complex social and environmental challenges, it’s even worse. 

Generally, women are leading social enterprise and social purpose organizations (SPOs). Generally, men are the investors. So sexism, whether it’s intentional or not, means women leading social change have a harder time raising capital. For those who are Black, Indigenous, people of colour, and other racialized communities, the situation is even worse. 

There’s more. Investors generally don’t understand how to measure your social impact; they often only have financial measurement in place. Your combination of business model, impact model, and incorporation model may not be understood by investors. 

Some investors outright won’t invest in nonprofit or cooperative social enterprises. If you have a Board, they are often too risk-intolerant to consider taking on investment. And while you are dealing with multiple overlapping crises trying to solve deep, systemic challenges on the front lines of your organization, who has time to learn how to raise capital from investors?

There. That’s a bunch of the context that gets in the way of social entrepreneurs and impact leaders in raising investment capital. 

Back to Purppl’s investment readiness and raising approach.

Purppl’s journey with social finance

Our journey so far includes friends and family loans, line of credit, loans from the credit union, raising equity, and now offering loans and revenue-based financing through Thrive Impact Fund.

In 2015, before incorporation, we got a small, very friendly loan from the cofounders. This was essential capital to allow Purppl a bit of time to get to first revenue and demonstrate proof of concept. Purppl incubated inside of Urban Matters; they offered lots of support, space, guidance, and allowed our revenue and expenses to flow through their operations.

In 2016, we incorporated, got a bank account at the local credit union, and a small line of credit. This was personally secured. 

In 2019 we started planning to build an impact investment fund. We could see the persistent gaps in social entrepreneurs in being able to access investment. It was initially called Liime. Liime was a place-based impact fund focused on investing in social enterprises in the BC Interior. 

As the pandemic hit in 2020, Purppl took on a loan from our credit union. This was really done to mitigate a lot of uncertainty as we looked into the unknowns of the pandemic. This enabled us to derisk hiring a new role focused on sales (Jude!); which really helped to grow Purppl and build a much more sustainable revenue model. We should have taken money sooner to enable growth and stability.

In 2020, we also raised an initial investment of $750,000 from Interior Savings to launch Liime. At the same time we began learning with and from the folks at Scale Collaborative who were also building a place-based impact fund focused on Vancouver Island. There was a lot to learn about share structure, corporate structure, raising money, due diligence, and investing into social enterprises. 

By the fall of 2021 Purppl and Scale Collaborative agreed to collaborate on a multi-place based fund, rather than build separate funds. Scale raised the first $1M investment into Thrive Impact Fund. By the end of that year Purppl had joined as a co-owner and Board member to focus on expanding Thrive Impact Fund into the BC Interior. 

In early 2022 we brought the $750K investment from Liime into Thrive and shut down Liime. An additional $750K was raised that year into Thrive. 

In early 2023 we raised an additional $1M in Thrive bringing the total raised to about $3.5M. We expect to raise an additional $1.5M by the end of 2023. Purppl also received a grant from the Investment Readiness Program (IRP). This patient, non-repayable grant is part of a diverse revenue model and enables us to deeply focus on expanding into a new customer segment. 

With capital comes measurement, or is it the opposite?

These days, we’re deeply focused on the role of data and measurement in building impact. While in some cases capital comes before measurement and in others cases measurement comes before capital, we’re confident that the two are intertwined. 

We’ve aligned with the Common Approach to Impact Measurement. The Common Approach isn’t telling you what to measure; it’s sharing wise practices about how to measure. 

You can read more about our journey into better measurement. It’s a constant learning process.

Learnings in the Journey

A few learnings stand out so far in this journey. 

  1. System change doesn’t happen alone (and you don’t have to lead). It was humbling to shut down Liime, end our small regional effort, and join together with Scale Collaborative to focus on Thrive Impact Fund. We are better together. We couldn’t do this alone. We were too small to be sustainable. We have a much higher chance of success and impact when we work together. It’s so refreshing to support and amplify existing leaders and initiatives rather than create and lead something alone. 
  2. Patient capital is critical. Working together with patient, values-aligned investors enables us to work in abundance. We have fantastic, values-aligned investors. This patient capital liberates us to experiment, learn, scale, and deepen impact. It changed our relationship with money to see it as a helpful, necessary tool rather than a necessary evil. We had to learn to be okay with asking for financial help. 
  3. Sustainable business models enable abundance. At Purppl, we are sustainable without taking on investment capital. At Thrive, we expect to be there soon. This gives us an ability to focus on our impact model and impact thesis. We can slow down and work on what’s important, not what’s urgent. We can take a long-term approach to build leadership capacity in the sector. We can commit to working on and measuring outcomes, not outputs. And we have time and space to work on incremental implementation of processes and practices which support thriving SPOs.
  4. Colonization, racism, sexism, and white privilege are deeply entrenched. It’s pervasive, it’s deep, it’s present in pretty much every organization and institution. This creates all sorts of barriers for social entrepreneurs and impact leaders in raising capital. At Thrive, we’re working hard to fill some of the gaps created by these barriers. 
  5. High demand for impact. Investors want to invest in social impact. While they are learning as quickly as possible what that means and how to support social entrepreneurs, in many cases social entrepreneurs know more about social impact. This puts social entrepreneurs in a strong position to influence and drive deal structure and impact metrics, rather than have that defined by an investor. There is also lots of impact washing and impact light, so those who are creating real social, environmental, and cultural impact will stand out amongst the rest. 

If you’re still reading (it’s almost done!) and looking for more, take a look at Social Innovation Canada’s Investment Readiness Case Study on Purppl. You can also watch and listen to SI Canada’s webinar and panel discussion. We’re deeply appreciative of the storytelling from SI Canada, and the patient capacity building capital from the Investment Readiness Program. 

Patient capital allows focus on what’s important

Context like this, and much more that we haven’t mentioned, are real barriers in the way of social entrepreneurs and impact leaders building and scaling solutions to systemic inequity. 

We’ve come to realize bringing in values-aligned, patient external investment and capital doesn’t have to be extractive. It’s actually a critical piece to build a sustainable, regenerative, and just economy anchored by a formidable social enterprise community. The capital allows us to work on what’s important, not what’s urgent.  

Want to raise capital to build, stabilize or scale solutions to systemic challenges?

Work together with Purppl to build a strategy for raising patient capital that's aligned with your values and impact.

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