Step into the offices of DBL Investors in San Francisco and it may seem as if you've entered a run-of-the-mill venture capital (VC) firm. Eight staffers scurry from office to conference room, refining their spreadsheets, pounding out emails and chatting on cell phones about their portfolio of exciting start-ups and growth companies.
There's little to suggest that this financially driven hustle and bustle is out of the ordinary. At first glance, DBL looks much like any other firm driven by dollars. VC investing traditionally has focused on financial returns at all costs; it can be a singular, unwavering goal. As the conventional wisdom goes, if you serve more than one master, returns will suffer.
But as it turns out, managing partner Nancy Pfund and her DBL colleagues are not that kind of venture capitalist. They're VCs of a different stripe, who -- in addition to making money -- want to do some good in the world. The firm's name highlights their emphasis on the double bottom line: yielding top-tier financial returns and delivering social, environmental and greater economics benefits through its portfolio of investments.
Is it possible for a VC firm to deliver strong returns while creating a better world at the same time? Pfund thinks so.
"We believe we can do both, and that one does not suffer because of the other," she explains. "I don't see it as a terribly thoughtful position: people saying that any kind of social investing will have inferior returns. If you look more closely, you'll find great impact investing and not so great, and you'll find that for any asset class."
Just consider DBL's track record: Its first fund placed in the top quartile compared to other funds of that vintage.
"Increasingly, there are investors who want more than a financial return," she says.
Pfund, pictured left, is one of them.
In some sense, DBL's investments do obey the law of financial return, just like their conventional VC counterparts. First and foremost, DBL's investments "need to meet traditional investment criteria," says Pfund. "If we fund a bunch of companies that don't go anywhere, we're not helping anyone."
What differentiates DBL is what happens next: incorporating the second bottom line value into the investment.
Next page: The double bottom line