10 years of FASE: crossing wild waters and gearing up for new adventures

Where passion for impact meets capital to scale: After 10 years, FASE is still dedicated to empowering a thriving ecosystem for social innovation in Europe.

By Ellinor Schweyer and Dr. Markus Freiburg, Co-Founders and Managing Directors of FASE

Cover picture: Ian Schneider @Unsplash

FASE’s 10th anniversary is just around the corner and provides us with a perfect opportunity to reflect upon the past and share our plans for the future with you. Of course, we wouldn’t have been able to reach this important milestone without our network of passionate impact investors and impact entrepreneurs and our highly engaged team, especially when facing turbulent times in a fast-changing ecosystem affected by multiple crises. So let’s take a breath and look back for a moment:

10 years ago, impact investing was everything but mainstream, so we started in a small niche of investors FOR impact 

In 2013, when FASE made its first steps in supporting impact entrepreneurs in raising capital, the number of impact investors was small. Most of them were deep-impact enthusiasts and social business angel pioneers. To expand our network, we had to tirelessly knock on doors and explain what type of impact could be generated by investing in early-stage impact ventures. And we faced a wave of prejudices and binary mindsets: For some capital providers, – whether they came from the philanthropic or the commercial worlds -, it was simply too hard to imagine that you could do BOTH, invest for positive financial returns AND boost social innovation. And there were no data sets available yet to support our case.

As a result, we spent a lot of time debunking myths about the real versus perceived risk of impact investing and about the true long-term impact of classic philanthropy. Our favorite claim back then: One Euro of donation creates impact only once. One Euro of investment can do so multiple times. The argument didn’t always fly. We had to create new and often hybrid financing models so that impact entrepreneurs could outmaneuver the dizzying gaps in the ecosystem. Back then, the social finance market was not able to create suitable solutions yet, so we simply had to invent them from scratch.

Honestly, it was a challenging and bumpy ride.

Our original FASE team consisted only of us, the two founders. Good publications and education programs on social finance were rare. Investing for impact was a tiny spot in the giant financing galaxy that was just about to discover sustainable strategies. On the one side, we were faced with the skepticism of our clients, the impact entrepreneurs, who were often reluctant to welcome impact investors into their companies, for fear of adverse influence and mission drift. On the other side, our network of investors was highly doubtful about whether they would be able to enjoy positive financial returns in combination with positive social impact. We were sitting between two chairs, so to speak, trying to bridge worlds that had very different mindsets and were miles apart.

Good reasons to sit back and celebrate? Yes and no.

What have we learned from this adventurous journey? First of all, it takes a challenging mix of vision, acceptance, resilience and persistence to follow through with your mission. In this respect, we are in the same boat as our clients, the impact ventures. Without our network of tireless supporters, from the BMW Foundation to Ashoka to the European Commission, it would have been much harder – and maybe impossible – to be at the point where we are right now. We made it and are now considered to be an expert in the impact finance universe, which makes us all the more happy to give back and share our deep insights with others.

So let’s distill where, at least in our view, the ecosystem has changed for the better and where reality still lags behind the vision:

(1) Impact investments are mainstream – but still not accessible for every impact venture

It is true: the market is changing rapidly. Industry experts and media claim that private market impact investing is at a turning point now. Last year, the Global Impact Investor Network (GIIN) sized the global market for impact investing at  US$ 1.164 trillion. As a result, asset managers today cannot afford to have NO products for their clients with at least some sort of impact claim on the label. On top, laws and regulations require them to report on ESG activities, with more legislation coming into force in the near future. This is, of course, very good news.

However, one question remains: Does this automatically improve the flow of capital to early-stage impact ventures? Not necessarily. The biggest slice of the impact finance cake continues to target returns of (close to) market rate, as the surveys from GIIN or the German Bundesinitiative Impact Investing reveal consistently year over year. For many impact enterprises in the early stages, this is simply too high to meet. This is why FASE set out to challenge the status quo by launching an innovative fund vehicle for German investors. The novelty of the “European Social Innovation and Impact Fund” (“ESIIF”): It is the first ever impact mezzanine fund in Europe to have received the guarantee mechanism EaSI provided by the European Investment Fund. Only 3 years after its launch, the “ESIIF” has become a real game-changer for European early-stage impact enterprises. And FASE is already preparing the launch of the ESIIF II, which will be structured as a convertible loan fund to offer an even wider range of instruments.

(2) Impact management tools are simpler and more shared – but still not sufficiently used

In the meantime, there have been many initiatives striving to develop shared frameworks and simpler impact measurement & management (IMM) principles and tools, for example, Acumen’s Lean Data, 60 Decibel’s client-centric approach or the Impact Management Platform. On top of this, all impact actors, whether entrepreneurs, intermediaries, or investors, now look at the Sustainable Development Goals (SDGs) as THE guiding framework, which is a big step forward.

Yet does this lead to impact measurement being more seriously and frequently used? In our experience: it is still one of the main challenges. The burden on impact ventures to do a meaningful IMM is high. And while more investors are pushing the boundaries to move to measuring outcomes, many are still tracking much less advanced indicators. However, SDFR has changed the landscape, pushing asset managers to report on their ESG activities.

In our belief, negative outcomes in traditional investment portfolios should be calculated to truly level the playing field. Then the positive impact that ventures create becomes more evident and can be monetized. For now, we advise our clients to include impact incentives in their (hybrid) financing models or to consider Impact-Linked Finance instruments. Once impact KPIs are achieved and monetized, impact ventures can enjoy a reduced cost of capital or an additional revenue stream. This gives them more leeway to pursue what is close to their hearts: scaling impact in a sustainable and healthy way.

(3) Impact investing is a continuum – not a set of well-defined, rigid boxes

More and more parties are stepping into the impact arena, with good intentions. But some just follow the herd, with no clear visions and ambitions of their own. This is why the distinction between “investors FOR impact” and “investors WITH impact” remains an important one for our daily practice. However, the lines are often blurred. The type of impact-return-risk profile an investor seeks is sometimes not clear from the start. And it may change over time as investors get more and more experienced.

At the same time, Europe is in a permanent state of crisis, which negatively affects investors’ risk appetites and investment horizons. For example, rather than searching for rare unicorns, more focus on the many zebras would create much more resilience. But without a shift of investor mindsets, it will probably remain challenging for impact ventures to raise funding and meet the return expectations – specifically for those working with untested business models in pioneer markets.

Today, we are proud to say that the market challenges have led to us having a more diversified client range, which additionally expanded to impact funds and impact scale-ups. As a result, we also call a more diversified and colourful impact investor network our own. More than 2,000 individuals, impact funds, foundations, business angels, ethical banks, venture capital firms, asset managers, family offices and corporates engage with our pipeline of mandates and the ESIIF today. And we are happy to see an equal share of investors inspired by the impact entrepreneurs’ personalities, journeys and themes, as compared to those who approach the topic from a more strategic and asset allocation perspective. In a nutshell: We are pleased to serve all types of investors across the returns continuum today. And we will continue pushing this approach and busting myths, not least with our inspiring hangouts and Impact Fire Talks.


The ecosystem has evolved – and so has FASE. As we overcome hurdles and continue to grow, we are hugely grateful to those clients, investors, funders, advisors and friends, who have supported us on our journey since day one. And we are especially proud of our team of colourful and seasoned experts, who walked the road together with us and with whom we share our passion for impact.
One thing is certain: We will keep pushing the boundaries by embracing the full spectrum of impact capital through innovation, collaboration, advocacy, and deep expertise. So let’s contribute together to a thriving ecosystem for social innovation in Europe in these turbulent times!


Ellinor and Markus