Investing with an LGBTQIA lens: An interview with Ise Bosch and Stefan Bollier
Dreilinden is a German-based nonprofit organisation dedicated to advancing social acceptance of gender and sexual diversity, via grants, social investments and networking. Dreilinden’s founder and CEO, Ise Bosch, has 25 years of funding experience in human rights, women and sexual minorities, and is co-author of Giving with Trust, a book about turning the power of money into power for the many.
GenderSmart spoke to Ise, along with Investment Committee member and founder of Impact Advisors LLC, Stefan Bollier, about their work enabling intersectional LGBTQIA communities across the Global South and Global East to access mainstream finance.
What is Dreilinden’s approach to gender investing?
Ise: We started investing in gender lens funds because we felt they were natural allies for our own focus, which is supporting LGBTQIA causes in the Global South and the Global East. Over time, though, we realised that the gender movement was still very binary and that approach disseminated down into the funds. While LGBTQIA topics were of interest during the fundraising process, these communities were being left out when it came to the allocation of capital. So, at the end of 2019 we decided to start investing money directly into LGBTQIA enterprises – that is, enterprises either owned by members of the LGBTQIA community or catering directly to those communities in a meaningful way.
Stefan: We are also funding research on gender lens investing beyond that narrow definition of gender.
Are there any particular challenges with the LGBTQIA investment lens that differentiate it from the gender lens?
Stefan: LGBTQIA lens investing is probably where gender lens investing was 10-15 years ago. It’s almost non-existent at the moment – there’s no movement, as such. That has to do with a lack of visibility; investors find it difficult to identify and find avenues to reach these communities and also to incorporate those lenses into their own analysis of opportunities and risk. It’s worth saying that, at least from our perspective, it doesn’t necessarily need to be a standalone strategy. It can be implemented as an add-on to an existing strategy, whether it be gender or climate.
Ise: On the theoretical side, there are parallels in the idea of referring to gender, as opposed to talking about women and men. It’s very helpful because here we're talking about sexual orientation, gender identity and sex characteristics, so there is an understanding of the advantages of an inclusive approach. However, the difference is that we don’t have the luxury of easy visibility across these issues.
“We are actively trying to move away from counting heads towards process metrics, which we believe are ultimately more sustainable and more impactful. Then, when it comes down to data collection, we always make sure that people actually have the opportunity to self-identify.”
What about challenges in terms of data measurement and management?
Stefan: We are actively trying to move away from counting heads towards process metrics, which we believe are ultimately more sustainable and more impactful. Then, when it comes down to data collection, we always make sure that people actually have the opportunity to self-identify. We also want to ensure that any data collected can’t be reverse-engineered back to the people who are providing their personal information. That, of course, is a particularly sensitive issue in certain geographies, which is also why we work closely with civil society organisations so that we have the local context and can address these topics in an appropriate way.
What are you focused on specifically right now?
Stefan: We focus on two key levers: The first is access to funding. When we started our first pilot in South Africa, we saw about 50 different entrepreneurs. None of whom had previously had the opportunity to pitch for financing or investment, clearly indicating that there is an entire cohort of entrepreneurs that has been overlooked. There's a lack of access to platforms, networks, and systems that their peers from other communities might take for granted.
The second lever is improving access to job markets, which is a universal problem amongst members of the LGBTQIA communities across the geographies we work in.
How does intersectionality fit into your work?
Ise: We have inventive methods to make sure that we don’t just reach the relatively privileged few within these communities. For example, there is a community panel that includes representatives from less prevalent populations, such as trans people.
“We tried out various types of products and investments with entrepreneurs that wouldn’t necessarily pass a traditional credit assessment and, so far, all of the money has come back. It just shows that the way investors (including ourselves) perceive risk needs to be re-evaluated”
Stefan: If you're working in the LGBTQIA space, you need to have an intersectional approach because it touches on so many different aspects of people's lives, from education, to race, to socioeconomic status. If you don’t engage with those different aspects it’s going to be difficult to identify opportunities, as well as to assess the risk. For example, a lot of the entrepreneurs we’re working with would never pass a traditional credit analysis but if you focus on their willingness to repay, it’s a different picture. We tried out various types of products and investments with entrepreneurs that wouldn’t necessarily pass a traditional credit assessment and, so far, all of the money has come back. It just shows that the way investors (including ourselves) perceive risk needs to be re-evaluated so that we can provide access to finance for the most marginalised.
What is the next stage in your mission?
Stefan: Where we can, we will continue to mobilise other investors to incorporate an LGBTQIA lens into their existing investment strategy, which is ongoing work and it's very hard to measure. The queer lens investing website that we launched is one way of supporting people to read up on the topic and access some of the resources that are out there at the moment.
