In the long and rich history of philanthropy, impact investing is a relatively new chapter—and one to which new pages are being written every day. Consider the timeline: the earliest definitions of "philanthropy” dates all the way back to the 5th century BCE, and the concept of modern philanthropy, as we know it today, was developed throughout the 18th and 19th centuries. Meanwhile, the term “impact investing” only entered the scene in 2007. Since then, the field has matured now totaling a $715 billion global market.
The mix of these investments, however, underscores that the market must continue to grow—especially when it comes to health.
The COVID-19 pandemic has illuminated deep inequities, both within and across countries, and we clearly need bold ideas and new resources. Even before the pandemic, greater impact investments in health were urgently needed. Worthy causes in areas such as inclusive financial technology or affordable housing were taking off; however, health-related impact investments remained limited. Why? Because health is complex, locally nuanced, and has incredibly high stakes. When we spoke with experts, many felt that they would need to significantly deepen their scientific expertise and capabilities to effectively make these types of investments.
Through additional consultation with leaders such as our engagement with the Social Impact Investment Taskforce, the conversations made it clear—Johnson & Johnson has a role to play in the health ecosystem for corporate impact investing. It was through these conversations that we became connected to know Patients Know Best—a startup that was looking to bring health records into the modern era through digitization. This was the context that led to the formation of Johnson & Johnson Impact Ventures (J&J Impact Ventures) and, ultimately, our first investment in Patients Know Best.
J&J Impact Ventures launched with a $15 million commitment from the Johnson & Johnson Foundation with a belief that if we invest in purpose-driven entrepreneurs and their startups, as their businesses grow, so will their impact. In the years since, our leap of faith has gathered some early proof points, such as growth in the underlying social businesses and the creation of hundreds of jobs, even during the pandemic. Since our first investments, our portfolio of entrepreneurs has reached 1.7 million people, and counting.
Take Jacaranda Health, for example. Since 2019, J&J Impact Ventures has provided funding to provide affordable maternal care in Kenya. The organization was achieving incredible health outcomes in a country where maternal mortality was both very high and largely preventable (according to Jacaranda, 55% of maternal deaths are caused by delays in action or inadequate care by providers, and quality gaps drive 90% of poor outcomes in Kenyan public hospitals). After a decade as nonprofit, the management team realized that in order to continue to grow Jacaranda’s impact, he needed to build a for-profit chain of affordable maternal care hospitals.
Another example can be seen in J&J Impact Ventures’ partnership with accelerators, such as Village Capital, to help bridge the gap in culturally competent care. Recognizing the market is nascent—rather than choosing a few “winners,” we decided to support a cohort of promising innovators, from building a digital platform to connect Black women with culturally competent medical care providers (Health in Her Hue) to supporting health workers who serve patient diverse and historically underserved patient populations (Certinell and Omaiven Health).
Throughout these investments and the several others within the J&J Impact Ventures portfolio, we haven’t just invested our capital. We’ve also invested ourselves. In offering health expertise, mentorship and industry networks, our value to entrepreneurs considers the whole of the business and what’s needed beyond financial backing. In tandem, these investments have helped our portfolio businesses to grow so that their innovations can reach communities sooner, more effectively and generate a greater positive impact.
From our first investment to our latest, we’ve learned a lot, too, including:
- How we are creating the companies of the future—where entrepreneurs are demanding, and thus building strong businesses with social impact embedded in their core operations from the onset. It was clear that a little bit of patient capital, companies can grow and scale to reach underserved communities—we just needed to put the right systems in place for these types of investments to be most effective.
- And what it means to support companies at different stages of the innovation lifecycle, including the idea that we shouldn’t run from riskier ventures, and we should welcome less-proven opportunities that show great potential. Partnering from an early stage in our portfolio companies’ development can help ensure long-term viability, especially when supported by the full range of Johnson & Johnson’s capabilities.
We’re carrying these lessons learned with us into the next phase of J&J Impact Ventures, where we will expand our commitment to $50 million towards supporting health impact entrepreneurs who are solving some of our world’s toughest health challenges. The work doesn’t stop, and neither does the learning.
The need for greater investment in health is clear, and the time is now. As for J&J Impact Ventures, with our partners, we’re ready to tackle the urgent health challenges our world faces.
In a moment filled with uncertainty, we have never been more sure that entrepreneurs and innovators are needed to build a healthier world for all. We hope others will join us in prioritizing health and catalyzing new investments that can bring good health within reach of everyone, everywhere.