Background presentation on Markets for Good, including the imperative, opportunity, local and global solutions for impact investing, with particular focus on the Social Venture Exchange (SVX).

1. Markets for Good Examining the Social Venture Exchange (SVX) and Global Impact Markets Prepared for MaRS Lunch & Learn Wednesday, February 23rd MaRS is where science, technology and social entrepreneurs get the help they need. Where all kinds of people meet to spark new ideas. And where a global reputation for innovation is being earned, one success story at a time.

3. Opportunity

4. Local Solution: Social Venture Exchange (SVX)

5. Global Solutions: Global Impact Markets

6. Discussion and QuestionsPg 2

7. Markets for Good Imperative

8. We are faced with seemingly intractable social and environmental problems at a global and local level.

9. Our Challenges: 1. Poverty 2. Climate change 3. Government debt 4. Economic transition

10. Sandy Lake First Nation 2008

11. Kenya 2009

12. Ottawa 2009

13. Windsor 2010

14. The Cost: Billions & trillions of dollars. Hundreds of thousands of lives.

15. Markets for Good Opportunity

16. 12 socialfinance [soh-shuhlfi-nans, fahy-nans], n.; synonym: impact investing Social finance is an approach to solve social or environmental challenges while generating financial return.This includes investments that range from producing a return of principal capital to offering market-rate or even market-beating financial returns. Social finance encourages positive social or environmental solutions at a scale that neither purely philanthropic supports nor traditional investment can reach.

17. Local Ventures

18. The Market Canadian foundations: $32M Local impact funds: $250M 200+ individual deals Local: $2B Global: $50B

19. Toronto Community Housing Corporation (TCHC) Bond: $1B Regent Park Revitalization with $450M Bond

20. Rowe Farms: ~$4 million in debt and equity investments to grow/expand retail operations via Investeco.

21. Planet Bean Coffee: $75k loan as a part of a $250k debt capital raise for expansion of retail operations via CAIC.

22. Centre for Social Innovation (CSI): $1.8M bond issue for the acquisition and re-development of new facility.

23. Market Potential Local foundations: $20B Canadian HNWIs: $1.42T 75% of target investors interested Local: $30B Global HNWIs: $120B Global: $40B - $1T

24. Infrastructure 20 Industry Standards & Systems Technology Internet + + + Soft Infrastructure: Talent, Trust, Networks, Models

26. Impact Measurement

27. Identification, due diligence and coordination

28. Deal design and financial expertiseInvestors: Supply of Capital Ventures: Demand for Capital

29. Markets for Good Local Solution

31. venture listings, fund listings, a resource centre, investor collaboration tools, and a service provider listing

32. allows investors to share due diligence, collaborate on deals, identify and access high quality, screened investment opportunities with detailed information reducing the burden of due diligence

34. Pilot Objectives 1. $2.5 million in capital for ten social ventures; 2. Positive social and environmental impacts; 3. List a majority of identified, existing investment opportunities; and 4. 50 investment opportunities listed during pilot period.

36. Deal size: Up to $10M

39. Important listing requirements modeled on mainstream markets related to:

40. Management and Governance

41. Finances

42. Social and Environmental Performance

43. Multi-step process from venture identification to private listing

44. Due diligence supported by third party providers and listings team, which includes financial professionals (CAs/CFAs)

45. No opinion or recommendation to the investor on the investment opportunity; just high quality information

47. Funder, venture, investor, service provider outreach

48. Product development support

49. Metrics Workshop Sessions: February & March

50. Listings review and due diligence on first selected ten ventures from March to May

54. CapLinked: platform for private investors, entrepreneurs, and advisors to find each other, build relationships, and transact business

55. SharesPost: 100 companies, 50,000 members, $1B in posts market for Facebook, LinkedIn

56. SecondMarket: facilitated $500M in trades since 2008 with average transaction of $2M and 3-5% commissionPg 31

58. Parallel evolution alongside other online markets

59. Venture focus: entrepreneurs in the developing world and sustainable, new economy ventures

60. Geographic focus: a global outlook or particular regions outside Canada

61. Motivation: Tackle social and environmental problems with increased access to capital

62. Range of financial returns (Zero – beyond market)Pg 32

63. Pg 33

64. Pg 34

66. Private placements and Direct Public Offerings (DPOs)

67. Secondary transactions and liquidity for restricted and illiquid securities and DPO shares

68. Investment minimums of $25k

69. Focus on community investments, environment sector, sustainable agriculture, microfinance, co-ops

70. Available to accredited and institutional investors only

71. No membership or listing fee; transaction-based fee structurePg 35 Cooperative worldzine on food, social justice, and global economy Human capital financing investing in postsecondary students Online bookseller converting books into literacy and education

72. Global Regional Markets

74. IPO and secondary trading platform providing liquidity and transparency

75. Products: Equity investments in for-profit social purpose businesses; Bond investments in both businesses and not-for-profit organizations

76. Provide both regulated financial reports and social/environmental reports that will be audited by third parties

77. Impact Partners: First step in strategy with matching platform launching in mid-2011

79. Over ten communities have demonstrated interest with greatest potential in Lancaster, Detroit, Hawaii, Columbus, and Albany

80. Interest in establishing a regional coalition starting with:

81. a conference to bring together small group of interested stakeholders and emerging exchanges;

82. coordinating staff to catalyze the regional impact exchange agenda through networking, shared research, and supportive business development; and

83. a shareable [open] market platform, which could be based upon the infrastructure developed by SVX.8th Annual Year in Ideas Most Innovative Nonprofit

84. Discussion & Questions