10 Lessons We’ve Learned From a Decade of Working to Reshape Finance
Current 13 - Insights:
As we celebrate 10 years of pushing the boundaries of impact investing at Align, I wanted to take a moment to share some of the lessons we’ve learned along the way. Reflecting on this milestone, I find myself filled with an even greater sense of resolve and optimism for the future we’re building together.
When we started this journey, impact investing was very much a question of “if”, not “when.” If we built it, would they come? Could Align play a pivotal role in evolving the impact investing marketplace? Should we dare to dream bigger and contemplate rethinking the entire financial services system? Could we bring others along with us? Could we find enough deal flow to meet the needs and preferences of our pioneering clients? Could we quell their financial return fears as well as help each of them dig deeper to realize their own “why”?
Could impact investing evolve from a hopeful possibility to an undeniable reality—the better alternative? Today, we can confidently say yes. The question is no longer “if” but “when” impact investing will permanently transform both the financial industry and the world around us.
Here are some reflections on the lessons we’ve learned and the insights we’ve gained over the past decade:
1. Impact must be integral to everything we do – it can’t be bolted on: It’s not enough to be grounded in purpose and to make decisions inside of that purpose. Authentic, purpose-driven enterprises must weave purpose into every aspect of their organization and client experience. At Align, our purpose drives every decision we make—from building an organization poised to reshape the future of finance to evolving today’s approved investments into solutions that will thrive 20 years from now.
2. Never stop learning: Investing intentionally is a continuous journey, not a one-time achievement. As societal needs shift and new opportunities emerge, we must update our game plans. The most successful—and most compelling—players in this space are those who embrace constant learning and evolution.
When we started, our focus was on applying a multiple-bottom-line perspective to investments. Today, we recognize that optimizing impact also requires a multi-stakeholder approach. Society’s needs evolve, and so must our strategies. Take the energy sector: ten years ago, the focus was on making solar and wind affordable. Now, nuclear energy is back in the conversation as nations plan for energy demands decades ahead that we couldn’t have even imagined ten years ago.
The same is true for housing: With homeownership increasingly out of reach, we’re seeing innovative financing tools emerge to help with down payments. In wealth creation, new models for employee ownership and profit-sharing are reshaping how we think about equity. The education journey never stops.
3. Play the long game: Longevity is key. Many of the early investments made by Align clients are only now beginning to show results. Some investments have particularly long timelines—spanning 15 to 18 years—to align with the pace of innovation. Others have faced delays due to macroeconomic challenges, such as higher inflation, which has created a tough exit environment for private funds. Playing the impact game requires a long-term perspective. It’s about understanding what you hope to achieve with your assets and having the courage and conviction to stay the course, even amid shifting macroeconomic conditions.
4. Impact takes many forms—across asset classes, return profiles, and investment strategies. With 10 years of experience and returns data, we’re no longer bound by the status quo. At Align, we continuously challenge traditional investment assumptions and emerge with solutions that expand the definition of ‘returns.’
We know how to build highly impactful, diversified, and risk-adjusted portfolios. Investing in first-time funds? We can do that. Addressing a client’s passion for specific issue areas? Absolutely. Whether it’s prioritizing women- or minority-owned businesses and fund managers, or incorporating high-conviction impact investments that deliver concessionary returns, we’ve proven you can create a portfolio that aligns with values and meets financial return goals.
5. Impact deal flow is thriving—even in the public markets. When we began this journey, our options were mostly limited to mutual funds and ETFs, valued for their low costs and some degree of shareholder engagement. Today, the landscape has evolved dramatically. Firms like Ethic are leading the way, offering sophisticated public market strategies that are not only cost-effective but also highly customizable to align with clients’ unique values and preferences. They’re even pushing boundaries on using technology and data to provide clients with a better understanding of how their portfolio is performing financially- and also from an impact perspective.
6. Our understanding of creating and measuring impact has become far more sophisticated. A decade ago, simply measuring impact in verifiable ways was considered sufficient. Today, measurement is just the baseline—it’s table stakes. Now, it’s essential to define outcomes over time, track a variety of transparent metrics, and connect that data to meaningful narratives. How has the investment changed lives? Has it genuinely improved society? It’s qualitative and quantitative.
7. Clients have evolved, too, and have a sense of clarity around the impact they want to create: Many of our clients have been on their impact investing journeys for a while and we’ve watched their influence and impact expand. They are actively living their values. Some are returning to school to deepen their knowledge and make more informed decisions about the change they want to create in the world. Others are traveling far and wide to witness the impact of their investments firsthand. Hearing these stories is always inspiring to me—it’s a testament to how far we’ve come and a sign of meaningful progress in the journey toward sustainable, global change.
8. Impact investing has officially entered the mainstream. According to the GIIN, the sector has surpassed $1.6 trillion—a significant milestone. Even with the controversies we’re seeing, such as the ESG backlash and resistance to DEI, there are signs of progress. While these critiques are often politically motivated, they indicate that mainstream finance is paying attention and taking the impact sector seriously.
That said, there’s still much work to do. Impact investing remains a small fraction of the global capital markets. True success will require transforming the entire financial system to ensure it works for all 8 billion people and the planet.
9. Consumers and investors are getting savvier and savvier and expecting more from their capital and purchasing power – they want defined impact at many levels. As the tools, measurement frameworks, and investment opportunities have evolved, so has the expectation from the consumer and investors. You can’t simply add a certain label and then expect that it will meet the demand of the end buyer. There is more product than ever, but lots of that product isn’t having the impact we believe is critical for true transformation. With consumers and investors having access to more data than ever, the purpose must be driven into the product at all levels. For example, if we are tackling affordable housing, we want to see impact at the Fund Manager level, woven into the fund’s structure and at the portfolio company level, and ultimately for the end beneficiary. It is not enough to just have impact at the fund management level with a diverse team.
10. The face of clients has evolved: In the early days of impact investing, Align’s clients were foundations and multigenerational families. Today we’re witnessing a huge shift. We’re seeing a movement led by large foundations and family offices. We’re seeing women and the next generation of asset owners recognize their voices and their power. And we’re seeing more and more investors who are starting to commit to impact with a large portion or even the entirety of their balance sheets. It’s incredibly exciting and affirming!
Like any journey to build a category while simultaneously building a mission-aligned company, ours has been a roller coaster. Looking back, many of the lessons we’ve learned might seem obvious—but each one came hard-earned through persistence and challenge. After all, if it were easy, everyone would be doing it.
Reflecting on our path so far fills me with hope and conviction about the future we’re building alongside our clients, partners, and peers. Our successes have only fueled bigger dreams and bolder ambitions.
Next time you hear from me in Currents, I’ll share my thoughts on what lies ahead for Align and the broader impact sector. If there’s one thing I know for sure, it’s this: our future will be even better than our past.
Wishing each of you and your loved ones a happy, healthy and meaningful start to 2025.
With gratitude,
Jenn
DISCLOSURE: The information presented in this blog is the opinion of Align Impact and does not reflect the view of any other person or entity. The information provided is believed to be from reliable sources but no liability is accepted for any inaccuracies. This is for information purposes and should not be construed as an investment recommendation. Past performance is no guarantee of future performance. Align Impact is an investment adviser registered with the U.S. Securities and Exchange Commission.
