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Amidst a roller coaster global economy, social capital is an encouraging bright spot. While traditional profit-driven capitalism is failing us, the social capital movement is budding, striving to do good and make money at once, shattering the traditional for-profit / non-profit dichotomy.  I was a relative newbie amongst the brilliant, entrepreneurial and proactive attendees of the first Social Capital Markets Conference (SoCap08) which took place this past week in San Francisco and I record here a few developments from the conference relevant to our impact conversation and invite you to join the conversation begun there.

SoCap08’s tagline refers to the “intersection of money and meaning” where “doing well and doing good is the mantra of a new generation of entrepreneurs and the organizations that invest in them.” SVT’s friend and the founding steering committee member of www.xigi.net, Kevin Jones, produced SoCap08, and pointed out in his opening remarks the fortuitous timing as well as the gathering momentum that the conference represented. Conference organizers expected 300 attendees. But over 600 registered; 50% did so in the last 3 weeks, which are some of the worst weeks in global investing history. The conference fee was around $1000 and people flew in from all over the world to attend, which is the most basic indicator of the excitement, energy and dedication gathering around the movement. Perhaps the meltdown actually catalyzed this convergence. As the Skoll Foundation’s Latest News Blog notes “many see the financial meltdown as a unique opportunity to promote the idea of social capital markets and double or triple bottom line accounting. The meltdown has revealed the risk associated with profit maximization at all costs.”

In a social capitalist economy, how do we measure impact?

A question that surfaced in seemingly every panel and sidebar conversation at SoCap08 centered on how to measure impact.  On day three of the conference (the unconference participant -led day), a group of us who are keenly interested in impact measurement gathered together in one breakout room for two hours to see how far we could hash it out.  Facilitated by a stellar combination of Tris Lumley of New Philanthropy Capital, Allan Benamer and Jeff Tuller of Socialmarkets.org, Paul Herman of HIP Investor, Alison King, Sara Olsen, and fueled by some 20 vocal participants, we came up with a lot of questions and not as many answers.   Some of the questions on people’s minds included:

•    What standards should we use to measure organization and program impact?
•    How do we make measurement simple without losing track of outcomes and credibility?
•    What is the “currency” of the social capital markets? How can social currency be created?
•    What are the barriers to measurement?  (I.e. why isn’t everyone already measuring their impact if it’s so central to the social capital market conversation?)

Join the conversation

The room was filled with people doing things to answer these questions through their work.  But it was clear that two hours could not do the topic justice.  The concrete outcomes of the discussion involved (unsurprisingly) continuing the discussion. Specifically, the group supported Tris’s idea to create an industry association of Impact Analysts, several parties agreed to collaborate to advance a clearinghouse of impact measurement information (at socialimpacts.org you can see the beginnings of a database of impact measurements, which will be expanded upon through the group’s efforts and by linking up with New Philanthropy Capital’s related effort), and an online group will be formed for day-to-day communication (the location is TBD but we’ll post it here when it is set up so if you want to you can join). Feel free to leave comments here about what you would have wanted to see if you’d been in the room, or if you were there what you thought of the conversation!

Social and environmental impact measurement has definitely piqued the interest of those joining the social capital markets.  It is also clear that impact measurement is relatively new and lacks universal terminology, definitions and alignment. Collaborating will help us create the language that will enable the market’s conversation.