Ever wonder who the farmers that grow your rice, chocolate, coffee, and cotton are? Ever want to know their stories, and let them know how much you enjoy their products? During this year’s SOCAP 10, I became acquainted with a new San Francisco-based social enterprise called the Hoop Fund, which provides a platform to do just that. The Hoop Fund combines the power of micro-lending with a consumer movement that connects customers with producers in the developing world. Loans directly support artisans, farmers, cooperatives, and small businesses that supply popular brands. For example, as a consumer you can make a loan to a cocoa farmer in Peru, who actually produces the chocolate that you buy at an organic store like Whole Foods.
The Hoop Fund’s CEO Patrick Donahue says any product that can be traced back to the producer who made it can spark a union. ”We get people together to make loans that are going to fund projects, and we try to take stories from the consumers and send them back to the producers,” explained Donahue. ”Most of the farmers never get to see their end products, and they never get to see how we enjoy them or experience them. So what we’re trying to promote at the Hoop is this idea of bringing consumers and producers closer together, creating a cycle where they can connect with one another.”
While a number of social enterpri
se models are built around poverty alleviation, and being able to generate a financial return, the Hoop Fund makes it possible for people to help generate products that they enjoy on a daily basis. Many of the items are from farm-based communities, but there are also weaving communities partnered with companies such as Indigenous Designs. Donahue says, ”Indigenous Designs works with weaver cooperatives down in Peru and Guatamala that actually design a lot of the designer clothing that they sell. They also help farmers get organic farming certification.”
As for how the Hoop is meshing with the social capital markets ecosystem, Donahue says that being in the presence of investors across the spectrum has been beneficial. ”It’s been great seeing all the different mindsets here at SCOAP,” he declared. ”There are people who consider themselves more traditional investors, and there are some people that really get the social impact investing side. And there are some people that think beyond that. They believe that social capital is not something that’s defined by money.”
What does this mean for the future of impact investing? Well, no one knows exactly. While a growing number of investors are entering the social impact space, they’re trying to determine how social investments can drive sustainable returns. Many of these financiers are looking 10 to 15 years into the future versus a mere two to three years, meaning sustainability is paramount more than ever. The promising side of all this is that while an end all be all solution has yet to be found, the conversation is in full force, leaving room for endless collaboration and strategizing opportunities between the world of finance and social enterprise with money and meaning guiding the machine.
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Tags: impact investing, Indigenous Designs, microloans, Patrick Donahue, SOCAP 10, social enterprise, The Hoop Fund
