How Social Impact Investing Creates Jobs for Hard Working People in Developing Countries

Mar 12, 2018 4:46:41 PM / by Peter Heijen, Founder | 2 minute read

It seems like these days everyone is obsessed with jobs. No matter where you turn, what newspaper you read, news program you watch, you will hear supposed experts talking about jobs.

Job Creation Through Social Impact Investing

But this is all with good reason. Jobs are the backbone of any economy. Without them, people don't have money, and without money, people don't eat.

With all of this in mind, it would make sense why one of the main focuses of social impact investing is on job creation. Not just any job creation though, sustainable job creation in developing countries where jobs are few and far between. In these countries, jobs aren't luxuries. They're not hopping from job to job in hopes of a better benefits package or hoping to diversify their resume. These people need jobs to feed their families and build their futures.

Of course, we all need jobs for this same reason. But people in developing countries do not have the same opportunities for getting jobs that people in developed economies do. That's why the primary focus of many impact investing funds and platforms across the world is job creation. 

Creating Jobs through Invested Capital

Companies that receive funding from social impact investments are able to use that funding to grow their businesses. Normally these companies are not meeting the capacity of their current demand. They've maxed out the number of goods or services they can provide with their existing resources and personnel. That's why they go looking for funding. 

Just like hard-working entrepreneurs on popular TV shows such as America's "Shark Tank" or the U.K.'s "Dragon's Den," these companies have passion, ambition, and the ability to make a profit with their small businesses, and they're ready to take their success to the next level. That's why they start seeking capital investments.

These companies know they if they can just hire more people, buy more equipment, or fund extra supply lines, they can make an even bigger profit, hire even more employees, and grow their business even larger.

Companies who want to hire additional employees but just don't have the money to do it, now have the chance to invest in their company by hiring new people. Those people are then able to feed their families and contribute more to their local economies and communities.

Eliminating Poverty

This job creation can have a spectacular social impact on developing countries. By providing new funding sources to emerging businesses, investors from all across the globe are able to help the world reduce poverty. It's a complete domino effect and it spreads to everyone throughout the world. 

By creating new jobs with social impact investments, we are building a better and more equal future for everyone, one investment at a time.

Topics: impact investing

Peter Heijen, Founder

Written by Peter Heijen, Founder

When I traveled through Nepal, India, and Bangladesh a few years ago, I saw with my own eyes that entrepreneurship and employment are the strongest weapons against poverty. However, many entrepreneurs do not have access to affordable financing. Crowdfunding seemed like a good solution, that's why I founded Lendahand. I've been amazed by the results!

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