Steve Case's "Rise of the Rest" Fund Sparks Debate on Definition of Impact Investing

AOL co-founder Steve Case and Hillbilly Effigy author J.D. Vance have recruited some of the country’s wealthiest to invest in their ‘Rise of the Rest’ fund, which aims to catalyze new markets and investing ecosystems in underserved, rural parts of the country. This New York Times article, which describes the purpose of the fund, sparked a widespread debate in the impact investing community when Case stated that the $150 million fund was NOT an impact investment, suggesting that impact investing doesn't generate strong returns:

“We’re fans of impact investing,” he said. “But we actually didn’t position this as an impact fund. First and foremost, our goal was to generate top returns.”

In response, Impact Alpha and guest authors discussed the importance of dispelling the persisting myth that impact investing cannot generate a financial return. Case responded, clarifiying that the primary reason the fund is not labelled as an impact fund is due to the absence of mechanisms for measuring impact. Without it, Case notes, the fund doesn’t meet the definition of impact investing set by the Case Foundation.