Impact Investments Explained by Our 9 & 10 Year Olds

We just returned from Central America, taking donor-investors to see impact investments in person. Seeing first-hand how these companies seek financial profit, social advancement, and spiritual impact was incredibly inspiring and we want to share some of those stories over the next few blog posts.

Over five days, we took 24 people to see eight projects in two countries. It was a bit of a whirlwind, so I recruited some help to describe what we saw: Jackson Johns, age 10 and Andy Minnich, age 9. I figured if two young boys can explain these social businesses, nearly anyone can understand. Certainly, these businesses are robust enough that we could write MBA case studies on each of them, but hopefully the simple explanation can help paint a quick picture of impact investing and spark your imagination.

Project 1: Pacaya Lodge and Spa - an eco resort near Laguna de Apoyo, Nicaragua

How does the business make money? 

People pay to stay there and they pay for food and drinks and the spa.

How does it make people's lives better? 

It employs people in a place where there aren't many jobs. And travelers like us have a safe place to stay. 

Project 2: Yucca Processing Plant, Granada, Nicaragua

How does the business make money? 

They sell yucca flour and other products.

How does it make people's lives better? 

The farmers can sell more of their crops (the B and C grade yuccas that large farm co-ops won't buy) and the processing plant turns them into stuff that Cargill will buy. Plus people work at the factory and they have a job.


Project 3: Tradeschool

How does it make money? 

[This was kind of a trick question. The school operates on a combination of tuition, selling products grown in the school's garden, and donations.]

How does it make people's lives better? 

It employs teachers so they have a job. Kids from nearby the school can get a better education and then they can get jobs too.


Jackson and Andy with Chad Duncan, our Impact Advisor and occasional babysitter, inside the collection unit (dam) at Blue Energy's first hydro project.

Jackson and Andy with Chad Duncan, our Impact Advisor and occasional babysitter, inside the collection unit (dam) at Blue Energy's first hydro project.

Project 4: Blue Energy hydro electric power plant

How does it make money?

They use the power of the river to turn a turbine that creates electricity. People pay for the electricity. 

How does it make people's lives better?

They can turn on air conditioning so they're not so hot. [Well most of the homes down here don't have A/C, so how else does it help?] If they have power in their houses, they can work or study at night after it's dark. 


Editor's note: If these descriptions spark your imagination and you want to learn more about how to donate or invest in any of them, reach out by email.