With SVX, the impact broadens

The process for those wishing to invest and make a social or environmental impact and for those seeking such investments just got a little easier.

This week, SVX, a registered exempt market dealer in the country’s four largest provinces that is a non-profit organization led by Toronto’s MARS Discovery District, launched its new ethical investment platform. That platform, whose long- form name is Social Venture Connexion, is more advanced — and broader — than an earlier version launched in 2013.

“We’re enabling all Canadians to invest for positive impact,” said Adam Spence, the founder and chief executive of SVX, who referred to the new platform, the new services and the new issuers as a “game- changer for impact investing in Canada.”

Spence, 36, whose organization is supported by the TMX, the Ontario government, the law firm Torys LLP and two prominent foundations, said SVX can help “unleash assets for individuals and communities with a tremendous amount of potential.”

SVX, which operates as an exempt market dealer, says in a press release it’s the only platform in Canada focused on offering investment opportunities in companies that “aim to do social and environmental good while making profits.” Previously it was only open to accredited investors, but it can now cast its net to retail investors. Under SVX 1.0, about $ 100 million was raised by about 150 issuers.

What ex cites Spence about SVX 2.0 is the additional features that have been incorporated from SVX 1.0, a platform Spence calls a “matchmaking database.” In essence the new platform facilitates financial transactions and allows SVX to operate nationally, while opening up opportunities for both accredited investors and retail investors.

Investments from the average punter are accepted provided the campaign, or particular investment, is eligible, and provided the investment is deemed suitable in terms of risk, return and investment objective. “We help investors make good impact investments by ensuring that it’s a good fit,” Spence said. Both debt and equity investments are being offered.

Spence is excited about the 10 new i ssuers — in areas ranging from renewable energy to enterprises empowering new Canadians — that have joined the platform.

The First Nations Bank is one newcomer. Founded in Saskatchewan in 1996, the bank has eight full- service branches and five community banking centres in Aboriginal communities. Majority Aboriginal-owned, the bank has about $ 35 million of equity capital and about $ 500 mill i on in assets, of which $330 million is in loans. ( TD Bank was one of its earliest shareholders and still has a stake of almost 20 per cent.)

The bank hopes to raise about $7 million of equity, of which $ 5 million will come from “targeted Aboriginal investors, the regional organizations that we typically raise our capital from through private placements,” chief executive Keith Martell said.

The hope is to raise the other $2 million from “social impact investors,” he said. A minimum investment of $50,000 is required.

“We have to continue to raise capital to drive our growth,” Martell said.

The Immigrant Access Fund is another first- time issuer on SVX. The IAF has been around since 2003 and supports hundreds of immigrants by providing direct loans to help pay for the licensing or training. The average loan is about $7,000.

So what’s behind all the developments? For one, regulations around accredited investments, in essence exemptions available under offering memorandums and crowd funding, and that allow greater retail participation, have changed. Then there’s the fintech revolution and the associated technology, which makes it easier to match those with capital and those wanting capital. Finally, social impact investing and responsible investing continue to gather new supporters.