Did you see the Cracks? How Impact Investing seeks investment to solve for our best future.
July 7, 2020
Impact investors are double bottom line investors. We look for financial return alongside “impact”. What is impact? Well, it’s different to each impact investor, but generally a positive impact outcome is something we can quantify such as lower GHG emissions, improved access to quality healthcare or improved skill levels in our K-12 students to prepare them for the future of work.
Today, the challenges of our global economy have been exposed under COVID-19 for all investors to see. Real concerns of inequality in industries including healthcare, education and job security are now part of the conversations in rebuilding the economy. Testing, protective equipment, and deciding who gets treated and who supports those patients of COVID is a scramble at best. Our schools had to quickly adapt to remote learning platforms and face the reality that school campuses actually provided more than an education, but a safe haven, technology, and too often a balanced meal.
These sudden swift market changes and broad acceptance of the gaps in the system support many impact investors thesis on solving for the future of health and work. When the government comes in to be the primary customer, and private payers start paying for essential services like these, it paves the way to why impact investment portfolios generally outperform or at minimum perform as well as their non-impact comparable asset class.
Because impact investors look at problems in society that if solved, can affect a lot of people, significantly; those solutions tend to have secondary domino effects across society, reinforcing the business and sector.
COVID-19 has exposed the cracks in the system. Impact investors, such as Amplify Capital were already tackling these for years as we looked to solve gaps in our society through business innovation and scale. Our impact investments cover improving drug outcomes, democratizing quality health care and access to quality and affordable mental health support. In education, as an investment group — impact investors have long known that education access in North America is unequal and uneven. Impact investors have sought out technology to supplement in-class learning to provide more personalized and wider access to quality education.
As communities move back to some version of normal we can ask ourselves, “what needs to change”? Can we prioritize equal access to quality education and equal access to quality healthcare for all? Can we agree that if we had that level of access we could be more resilient as a society to face any healthcare or environmental challenge we are bound to face in the next decade if not sooner?
Impact investing can help support the roadmap to get ahead and build for the future we want. In addition, early stage innovation investments in social sectors create jobs and skills alongside the business. If we expand our investment goals beyond financial return, we can emphasize the ultimate outcome of that business on society.
Photo by Holden Baxter on Unsplash
We have the power to shape what recovery from the COVID-19 crisis looks like. We need to start asking how we can use investments to shift our preparedness and make investments that can benefit the economy, people, and the environment. This crisis has demonstrated just how applicable and adaptable our portfolio of impactful companies can be. Inkblot, an online platform that provides low-cost, anytime, video mental health counselling, was able to pick up the dramatic uptick in need for mental health support. Chalk, an all-in-one education platform that streamlines curriculum and instruction for educators, is helping to support K-12 schools that seek to pivot to distance learning and maintain education outcomes. ClassCraft, through their scalable technology platform, was able to provide free access to their remote education program to keep kids supported engaged with each other and the teacher at home. What sets these companies apart are the integrated impact targets which keep them accountable and moving forward through good and challenging times.
What are your investments doing to support our best future? We have seen impact investments provide both financial and impact outcomes. We hope all investors start thinking about how they can incorporate impact into their portfolios.
Flosonics Medical and Verv Technology partner with HSNRI
A pair of Sudbury based biotech companies, specializing in wearable and portable health care devices, are the latest additions to the Health Sciences North Research Institute’s (HSNRI) facility on Walford Road.
Flosonics Medical is a biotech company that has already received international attention for their invention known as the Flopatch – a wireless and wearable sensor that uses ultrasound to monitor vital signs for critically ill patients. The Flopatch collects information on heart rate, pulse, blood flow and fluid levels of patients and then transfers that information to a smartphone app so that the patient can be monitored in real-time from anywhere on the planet.
“Imagine a patient who needed to be airlifted from a remote community on the James Bay Coast. If the nursing station in that community has the Flopatch, a critical care physician in Sudbury could be monitoring that patient as the helicopter is in transit. The doctor could be telling staff to do different things to help keep the patient stable and prevent their heart from stopping,” says Joe Eibl, CEO and co-founder of Flosonics Medical.
Verv Technology is a Sudbury start-up that’s developing breakthrough technology in home health monitoring. The company has developed a device that will allow a person to monitor a number of different health indicators all with a small drop of blood and a smart phone.
Home health monitoring has taken off in recent years as large companies like Apple, Samsung and Amazon have declared this the next major technology. While home monitoring devices for diabetes and high blood pressure have been around for many years, Verv’s technology is a game changer as it can do something that no other portable device can do – separate plasma from the blood sample using a very simple and inexpensive device.
“No more waiting in doctors’ offices, no more driving to the lab, or big needles drawing multiple vials of blood and waiting days for results,” says Verv President Jeff Sutton. “Our platform allows for multiple tests on one disposable cartridge that collects the blood and performs analysis that can be read within 15 minutes, all controlled by your smartphone.”
Verv will continue to work on the technology at HSNRI’s lab on Walford Road, with the hope of putting this device on the market in 2-3 years. Flosonics expects to have the Flopatch officially on the market in the coming months and already has potential customers lined up in the United States.
Partnering with Flosonics and Verv is important for HSN and HSNRI as the organizations strengthen their academic and research impact improve health outcomes for patients of Northeastern Ontario.
INKBLOT THERAPY RAISES ADDITIONAL $700,000, BRINGING PRIVATE PLACEMENT TO $1.7 MILLION CAD
“Toronto-based Inkblot Therapy, which uses matching algorithms to connect clients with mental health counsellors, has raised $700,000 CAD for the second tranche of its private placement. This second portion of funding brings the total raised in Inkblot’s private placement to $1.7 million CAD.
Investors include Amplify Capital (formerly MaRS Catalyst Fund), with participation from Good&Well, Active Impact Investments, The Good Fund, and several Toronto-based angel investors. Inkblot raised $1 million CAD in the first tranche of this round of funding in January.
Luke Vigeant, co-founder and CEO at Inkblot, told BetaKit since the company completed the first portion of this raise, Amplify Capital and Good&Well doubled their subscription amount, and the startup was able to secure some new investors. Inkblot was originally aiming to raise an additional $500,000, which makes this round oversubscribed by $200,000.
This funding will be used to grow Inkblot’s corporate client base in Canada and the United States, as well as support its key partners and provider network in the United States, in order to meet demand south of the border.
“This investment comes at a pivotal time in the world of virtual mental health services,” said Vigeant. “It’s been our busiest week in the history of the company, we’re working really hard to ensure all of the companies, schools, and people reaching out to get additional support during this time of need.”
INVIVO.AI supporting machine learning expertise in drug discovery efforts for COVID-19
Amplify Capital portfolio company Invivo.ai has joined Mila’s efforts to develop novel data-driven solutions to assist with COVID-19 outbreak.
“Sébastien Giguère from InVivo AI leads a data-efficient deep learning to better model emerging biology. The COVID-19 outbreak offers a solemn reminder of how little we know about emerging biology. Novel algorithms are needed for these types of data poor environments.
Launched in 2018, InVivo AI is developing novel algorithms capable of learning from small and noisy datasets. In light of the COVID-19 outbreak, the startup is leveraging their platform to learn models of pathways in the immune system to better predict immune response. The team is working on modeling proteasomal cleavage, TAP transport, antigen binding to MHC, antigen processing to the cell surface and recognition of MHC-antigen complexes by T-Cells and B-cells, with the goal of providing insight into immunogenic regions of the virus.”
This 20-Something Has 500,000 Teachers On His Platform
Five years ago, at the grizzled old age of 22, William Zhou was named to Forbes 30 Under 30 list in education. Zhou had an education company, Chalk, he said would help teachers make and monitor their teaching plans and curricula. At the time, Forbes noted that 100,000 teachers were using the system.
Two years ago, the number of teachers on Chalk flipped past 250,000. Now, Zhou says, half a million teachers use his lesson plan platform.
When the company started, Zhou says, he was focused on helping teachers plan their lessons. Seeing his own high school – high school! – teachers struggle with lesson planning, Zhou had the stereotypical entrepreneurial reaction. “There has to be a better way,” he said.
“For teachers,” Zhou says, his product “is a lesson planner. But really the kicker, the lightbulb is that it’s not siloed off from the curriculum, it’s something that teachers can pull directly from the curriculum they use to make their plan.”
And now, he says, the focus has grown. “We’re not just the teacher side,” he said. “We’re really looking at the entire district, the curriculum as a whole.”
The link between teacher lesson planning and actual curriculum – what’s being taught – is increasingly important for districts, most of which are required to show that their teachers are delivering the lessons, programs and activities that align with set standards and that those classroom deliverables align with one another. Designing that alignment, being able to visualize it, is called curriculum mapping. And, according to Zhou, that’s what Chalk really does.
“It’s a process almost every district has to undertake, to plan exactly what we are teaching to our kids – going from grade level to grade level ensuring we’re teaching the right standards, making sure that ultimately we’re delivering the right information,” Zhou said. “I equate it to very much like a business plan for the schools – here’s how we’re going to tackle what we teach.”
But, Zhou says, many, even most districts are not doing that – or at least not doing it as well as they’d like to. “Everyone wants to get to the level where curriculum is unique to their learners,” he said. “But most of the districts don’t have that ability yet.” In fact, he says, there are a, “large number of districts where teachers aren’t even planning at all.”
That’s the opportunity. And it’s showing up. Chalk’s district growth mirrors its teacher acquisition. “Three or four years ago we were in four states, now we’re in 27,” Zhou said, noting that his company is, “on track to hit profit this year.”
The growth is impressive, and the business model is familiar – design a good product that teachers want to use, make it free to them then sell to districts. Familiar is not a criticism; it’s familiar because it works.
Even though the company bootstrapped to start, it now has VC backing. “Mostly impact investing folks,” Zhou says – Amplify Capital, John Baker, CEO of D2L, and investor Randall Howard have all gone in.
“Today it’s all about growth,” Zhou said, citing Chalk’s emerging work with Chicago Public Schools as an example. But he also noted that the company is looking ahead – considering “a more premium offering” for teachers using the planning tools and perhaps moving beyond providing technology only. “We tend to be a technology partner today, but that does not mean we don’t want to play [a different] role going forward.”
For now, Chalk is on a vital and under-served side of education technology – planning and mapping. “There are a ton of people out there measuring assessment, but that’s outcomes,” Zhou said. “We’ve seen so many other ed tech companies do that, ask what happened. We want to not just ask what happened, but why did it happen? The only way to do that is to look at the plan, to ask what’s your plan?”
“Curriculum,” Zhou said, “impacts everything – it drives everything in a school including their culture.” Helping teachers and districts get that right, or at least to do it better, in a planned, accessible and modern way is unquestionably important. Based on what’s happening at Chalk – what’s happed in the past five years – it looks like good business too.
Mental Health Benefits Startup Inkblot Secures $1M+ in Seed Funding
Investment led by Amplify Capital with additional participation from Good & Well, Active Impact Investments, and others
TORONTO, Jan. 23, 2020 /CNW/ - Inkblot Technologies Inc. ("Inkblot") announced today that it closed on the first tranche of capital in seed round funding led by Amplify Capital. Inkblot provides modern mental health solutions — effective and accessible employee care — to Canadian and US companies. This funding will accelerate Inkblot's sales, channel-distribution strategies, platform development, and their continued expansion into the United States.
"We are proud to lead this round of fundraising and support the team at Inkblot as they provide solutions to the mental health crisis here in Canada and abroad," said Kathryn Wortsman, managing partner of Amplify Capital. "Inkblot's comprehensive platform has dedicated applications built to improve the lives of those running companies, their people, and the counsellors providing care. We have seen a number of mental health ventures, but Inkblot stands out as the only data-driven solution that demonstrates improved mental health outcomes and a healthier mental state in both the workplace and outside of work."
Inkblot offers a confidential online video solution for mental health counselling. The product uses advanced technologies for intelligent therapist matching, effectiveness monitoring, and maximizing the human connection between care providers and clients. By providing access to qualified counsellors coast to coast Inkblot removes barriers posed by the shortage of mental health therapists available outside of major metropolitan areas.
Inkblot's clients include organizations that recognize that improved access to mental health support in the workplace leads to employees who feel better and are more productive. Inkblot has also established partnerships with the leading national providers of group benefits on mental health platforms.
"Inkblot has built strategic mental health offerings for a range of companies of varying sizes and internal benefits landscapes," said Luke Vigeant, co-founder and CEO of Inkblot. "The additional capital we've received, and the caliber of investors we have attracted on this round will be instrumental in supporting our continued team and sales growth across a number of customer channels, and most importantly, the tens of thousands of people covered by Inkblot Mental Health Plans today".
In addition to Amplify Capital, Good & Well and Active Impact Investments participated in this Seed round. Inkblot has the option to close on an additional $450,000 of additional capital prior to February 14, 2020.
Additional information on Inkblot's Corporate Mental Health Benefits Plans can be found at: business.inkblottherapy.com
About Inkblot
Inkblot is a VC and Techstars backed Toronto-based company offering corporate mental health programs, with a focus on secure video counselling that is available any time, any place to make mental health support readily accessible. Using a proprietary algorithm, employees are matched to the best counsellors for their specific needs and preferences. Uniquely, Inkblot monitors clinical effectiveness and client satisfaction session-to-session. With Inkblot, employees can get the help they need when they need it. Inkblot's mission is to create affordable, accessible and innovative services and technologies to improve the psychological health of individuals and organizations. Inkblot is a proud alumni of the 2019 Techstars Toronto Accelerator program as well as the DMZ Growth Accelerator program in Toronto.
About Amplify Capital
Amplify Capital, formerly the MaRS Catalyst Fund, is a seed-stage venture fund investing in highly scalable technology companies solving for social and environmental market gaps. Amplify believes that a thriving economy is one of reduced inequality based on a foundation of affordable clean energy, quality education and healthcare. Amplify Capital is based in Canada and invests in Canadian mission-driven businesses... https://www.amplifycapital.ca/
About Good & Well
Good & Well is a boutique impact investment firm based in Toronto, Canada that partners with early-stage social purpose businesses. Their mission is to help catalyze a more purposeful, sustainable economy for all.
https://www.goodandwell.ca/
About Active Impact Investments
Active Impact Investments is a certified BCorp based in Vancouver, BC that manages a limited partnership fund with $10M in assets under management. They exclusively invest in small private companies that solve an important environmental or social problem and they provide extensive post-investment support. https://www.activeimpactinvestments.com/
SOURCE Inkblot
For further information: For Additional Information on Inkblot: Luke Vigeant, Co-Founder and CEO at Inkblot, lukev@inkblottherapy.com
Betakit profiles Amplify Capital’'s fund 2 launch.
Amplify’s new fund will be spun out independently from MaRS when the fund makes its first close, with initial capital commitments expected to finalize early next year. The firm plans to co-invest or lead in about 20 deals total, with a focus on the health, education, and cleantech.
Industry News:
Impact Investing becoming Mainstream in Canada
For many Canadians, it’s important that their investments reflect their personal values. A first step may be to avoid investing in companies whose business they see as unethical, such as weapons manufacturers, tobacco and fossil-fuel companies. But an increasing number of people are looking to go further. They want to invest in firms that are working actively to make the world a better place.