Accelerating the flow of capital to good

© 2007 all rights reserved

Sustainable interventions using the market to change the game and help people

bridge the gap

What Goodcap does

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© Aquillian Investments LLC, Aquillian.com

Tired: Efficient Frontier

© Aquillian Investments LLC, Aquillian.com

Wired: New Efficient Frontier -A new, third dimension where risk and return balance with impact.

Like microfinance but with millions invested in each company rather

than hundreds of dollars.

The efficiency of the market harnessed for good

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investment | philanthropy

New capitalwith new power to make change

The hallway

Investment office

Foundation house, and investment tower

That was three years ago. The initial market reaction was hard.

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I pitched one guy when GoodCap started our social enterprise expansion fund. He lives in two worlds. With one hat on, he’s a major investor; runs billions. Been doing it a long time, survived, now doing well again.

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He said he loved our approach, and could imagine giving us million from his foundation, if we raised a venture philanthropy fund; which is a more sophisticated way to give. But he could not invest a dollar; he just could not think about his money that way. We made his head hurt.

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We said there was a Social Capital Market and that we were going to build a fund there, at the intersection of money and meaning, where you could get scalable social impact and a double digit IRR financial returns.

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That made his head hurt even more. He said our idea was wrong. Our plan was flawed. We were the wrong guys and we were going to fail. He didn’t want his name associated with us. He left us to pick up the tab for breakfast.

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That’s the kind of rejection all entrepreneurs face. But to his surprise, in the space between traditional investing and giving, at the intersection of money and meaning, in the Social Capital Market, we are actually making it happen.

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We did two things to make people’s head stop hurting

First, we invested before the fund closed in two good companies, Better World Books and Adina for life. Seeing our companies, and their combination of social and financial impact and our engagement, we started to make sense to people.

But that wasn’t enough; we needed to show people that there was a real market emerging at the intersection of money and meaning. That we were not just lone, hand waving visionaries with a couple of lucky, one-off bets.

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Our portfolio proves our point

• Better World Books: $18 million revenues online bookseller when we invested in April 2008. Now at $46 million (run rate) with $3m plus ebitda in 2009, and a $2 million line of credit paid off. Growing more than 35 percent year over year.

• Goodcap helped with founder transition, helped hire a CFO, a VP of marketing, helped create an analytics/yield management operation, worked on SEO, branding, marketing strategy and implementation.

• Top Genx consultants work cheaper for the meaning premium our companies give them.

• BWB’s secret sauce: the social mission cuts operating costs; people give us our books. The mission can survive the exit.

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You can mix financial returns and social impact

• Adina World, a juice company founded by the founder of Odwalla, with management and investors who led Sobe, Izze and Oregon Chai has raised more than $20 million.

• GoodCap is at the table to make sure fair trade stays real. We have done that, partnering with traditional investors and keeping the mission focus intact through product changes and new investors.

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Then we showed them it wasn’t just us

Next we created Socap, the Social Capital Markets conference. We attracted 650 people from 26 countries in 2008. We grew more than 30 percent this year, with 1050 people from 34 countries. With the top impact investors gathered in one place, people realized realized that the Social Capital Markets was real, that it was big and still growing. With the economy in a deep reset mode, it makes more sense than ever. Socap helps validate the category.

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We may do four more deals

• We are excited about the potential of Fair Trade. We have seen that Americans, even in the downturn, are becoming conscious consumers, not just cost conscious consumers.

• We are the only venture investor in Fair Trade and plan to do several more deals. We are building the market infrastructure to grow supply and increase demand.

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Growing market opportunities

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Est

. An

nu

al G

row

th %

30%

50%

Fair Trade$2.2B

OrganicApparel$583M

Organic Food$15.5B

Microfinance$7B

10%

20%

40%

We are proving our point

. In response to investor demand, we are considering raising a second fund, focused on Fair Trade, perhaps linking it to local food.

• Our idea seems to have been right. • Our plan has not been flawed.• We seem to be the right guys.

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investment | philanthropy

New capital with new powerto make change

Accelerating the flow of capital to good

© 2007 all rights reserved