Kostis Tselenis | Founder and Partner at HIIN (Hellenic Impact Investing Network)
Interview given to Ms Maria Louisa Vafiadaki
-Please introduce us to HIIN. What is your vision, your targeted audience and which impact themes do you mostly deal with ?
This is a project founded by myself in Geneva back in 2018. I am part of the international impact investing community for more than 20 years now and back then I realized that both in terms of potential investments, as well as in terms of understanding of the impact methodology, Greece was really behind. Due to my passion about my home country, I thought it will be a great idea to give something back and help Greece create an impact ecosystem.
This is how the HIIN, the first impact investing platform for Greece was born. I run this idea with Antonis Schwarz and Nikolaus Hutter, both international impact experts with a strong link to Greece, who very enthusiastically told me to go ahead. Together with the rest of the team, they both strategically support the HIIN today on all fronts.
As you are aware, Impact Investing is a methodology which targets businesses that are not trying to mitigate the harmful effects they have towards the environment or the society, but they are oriented towards providing solutions to global environmental and social challenges.
While in markets like the USA and Western Europe, impact investing is more developed, the Greek market is lacking of a strong start-up ecosystem in general. And a strong start-up ecosystem, paired with strong innovation capacity, is a requirement for the development of an impact ecosystem as well. Greece might be advanced in renewable energy infrastructure, with impressive contribution of alternative energy sources to the country’s mix, but besides that, other impact themes are not developed.
There are two main verticals when it comes to the vision and mission of the HIIN. First to help support the creation of a local impact ecosystem and then put Greece on the global impact investing map, i.e. connect Greece to the international impact community. Creating awareness is a first step, but it goes beyond that, by launching initiatives such as the mapping of initiatives, ventures and investors with a sustainability focus, an impact accelerator and impact ventures database etc. We are not focusing on specific impact themes, as we feel that all areas need to be promoted. Blue Economy, Sustainable Agriculture, Energy Transition, Social Entrepreneurship etc.
What is the picture for impact investing in Greece today?
As mentioned already, I feel that Greece is a bit behind in terms of impact investing. But this is changing gradually. Greece is good in replicating trends that come from Western Europe, relatively quickly. I think this is what will happen with impact too. But the question is how will it happen.
The HIIN’s role guiding local participants is catalytic. We do see several start-ups, but they are very small and not necessarily scalable. And in the last 2 years, there were some financial products launched with an impact focus, still not very big in terms of size, but this is a good start.
When it comes to ESG, this is developing well, and this development is welcome, but it is not impact. There is some confusion still in terms of differentiating ESG from Impact Investing, but this is the case abroad as well. We want to make sure that the impact methodology is not confused with ESG, and we need to be more “aggressive” with our communication, through events and publications.
-How do you perceive impact investing in terms of financial return? Is it true that there is a misconception with regards to that ?
There is philanthropy and then there is venture philanthropy (impact first approaches). All approaches are very welcome and they have their own role to play. We believe in investments with high impact profiles and a balanced risk-return profile. The reason for this is that such profiles allow for scalability. And we need size, when it comes to solving international environmental and social problems. We will not be able to do that without scale and without being able to attract “mainstream” capital into impact investing. This is the reason of our focus.
We need to educate the audience, not only in Greece but also abroad. And several impact ventures that might not seem too profitable, with the right investment readiness program, coaching and support, they can revamp their business model in a way that allow for future profitability and allow for financing from professional investors to scale up their idea. This is another service that the HIIN offers.
We pair investment readiness programs with impact readiness. This is also important, especially with investors in the impact community. We also want to create an impact framework, guidelines, based on the United Nations Sustainable Development Goals and the GIIN framework, with specific impact metrics adjusted to the needs of the local market, for companies that need some inspiration to start measuring their impact and reporting on it.
-What are the main challenges in your day-to-day work?
Greece is currently very attractive to foreign investors, due to a very extroverted and competent current administration when it comes to helping international investors invest in Greece, but also due to a very favorable grants environment. The HIIN wants to play a catalytic role in influencing to a certain degree the nature of investors that come to Greece. We need more impact capital, not just capital. This will set the right base for the advancement of the local economy to a circular economy over time. There is a momentum. Therefore the HIIN needs to move very quick in whatever it does. We do not have time to loose. Our challenge is to source more donor capital, to expand the team and be able to deliver quickly on all our verticals.
There is not enough information about sustainability and impact. And the HIIN needs to bridge that gap. And we need to do this quickly.
The 1st Hellenic Impact Investing conference that we organized on the 16th of February was a major success. It has put enormous pressure on the team, as it became much bigger than originally planned and it was very international too. As with the conference, another challenge is our second main goal, i.e. connecting the local ecosystem to the international ecosystem. We have the network of course globally, but this requires special attention and time, it requires international partnerships that take time until they materialize.
I mentioned before that one of the HIIN verticals is to conduct an extensive study to map the local ecosystem. This “impact map” will also be a milestone for the country. But collecting the information can be challenging too. We have the right tools, but we will need more capacities to do this properly. It is a challenge, but it is an opportunity at the same time. We will do this through collaborations and we are already in discussions with fellow impact platforms and experts.
The HIIN’s goal is to create a National Advisory Board within 2023. We are already advancing, but this needs a new governance structure and a lot of collaborative parties, so it needs extra resources and of course it needs more time.
Can you talk to us about one of your most recent feature stories which you think is worth noting. How did you support a young Greek entrepreneur and what was your contribution ?
We cannot mention specific start-ups, as this information is not public. We are helping a sustainable agriculture start-up, a sustainable food start-up and an alternative materials start-up with their investment offering and potential investors currently. All fantastic ideas, with great, young and forward looking teams and very promising outlook. We will showcase ventures that we support our website in the coming months.
The main challenge here is to educate the entrepreneur on articulating their impact, but also becoming “investment ready”, and that requires a lot of work. It is difficult to bring the offering of an early business to professional investor standards. But that allows them to approach the right investors, from Greece and abroad; investors that are aligned with the company’s mission but also can add value, beyond their financial support. We also help with investors in our ecosystem, local and international fund managers etc.
What do you aspire to achieve as HIIN?
We want to be the reference point when it comes to impact investing in Greece. Both to entrepreneurs and investors. We want to be able to help the government in creating the right regulatory frameworks and programs to advance sustainability and we want to move quicker in supporting the creation of the local impact ecosystem. The 1st Hellenic Impact Investing Conference was a milestone, it was a major success, and next year we are expecting it to be even bigger, but we need to continue with education, also with smaller, more focused seminars and events. Education is key for us. We are also liaising with the academic community to see how we can help with impact programs and courses to shape the thinking of future entrepreneurs.
We want to connect more Greeks dealing with sustainability all over the world (“HIIN Ambassadors Program”), scale up our capacities with more expert and ensure more financing. We want to make impact investing an everyday word in Greece. The methodology should be part of all financial institutions and corporates, of political think tanks and state and private organizations looking into advancing sustainability. The more people we “convert”, either students, or entrepreneurs, or state officials, or investors, the better. And the quicker we do this, the more chances we have to advance Greece into an important impact hub in the next 5 to 10 years.
Thank you.