Could your capital work differently? Four questions the August Market Information Day helped answer

If you’ve been curious about impact investing but haven’t quite crossed the line into blended finance, you’re probably asking the same questions many others are.

Are we putting charitable assets at risk?

Why invest when we could simply make another grant?

Will the additional complexity create greater impact?

And does a foundation like ours, even a relatively small one, have a place in this?

While these questions weren’t asked directly at the Foundations Group for Impact Investing’s latest Market Information Day in Sydney, they sat just beneath the surface throughout the afternoon.

Through presentations from four organisations working across education, housing, Indigenous economic development and rural communities, attendees were invited to consider not whether grants should be replaced, but where different forms of capital might unlock greater impact.

What became clear was that none of the organisations were asking philanthropy to abandon grantmaking. Instead, they challenged us to think about when grants are the right tool and when other forms of capital may help proven solutions scale their impact.

“Why invest when we could simply give another grant?”

One Education Foundation provided a compelling example of how investment can support organisations that have already demonstrated their effectiveness.

Over the past two decades, the organisation has quietly built a commercially sustainable model that designs affordable laptops for disadvantaged schools before refurbishing and redistributing them to digitally excluded Australians and overseas communities.

This isn’t a start-up testing an idea.

It’s a proven model that has already generated commercial revenue, supplied nearly 600 schools and extended the life of thousands of devices that would otherwise end up in landfill.

As Matthew Ciao reflected:

“We’ve done it all without external funding. Now it’s come the time to make our impact story even louder.” (16:02)

That statement reframes the role of philanthropy.

Rather than funding another pilot, impact investment can help organisations that have already demonstrated their impact reach many more people.

The question shifts from “Should we fund this?” to “How can we help this scale?”

“Am I putting charitable assets at risk?”

For many trustees, this may be the hardest question.

Women’s Property Initiatives (WPI) offered insight into how blended finance structures can be designed to balance impact objectives with prudent risk management.

Its proposed Women’s Housing Fund combines philanthropic grants, concessional loans, government-backed subsidies, developer discounts and senior debt to finance long-term affordable housing for women experiencing homelessness.

Importantly, the organisation isn’t asking investors to take on planning or construction risk.

Capital is only called when homes are ready to settle.

As Lucy Simms explained:

“We are doing what we’ve always done. We are just adding one layer to our capital stack by including concessional loans with philanthropic capital.” (32:15)

That sentence captures one of the day’s key insights.

Blended finance isn’t necessarily about taking more risk than traditional philanthropy. In some cases, it allows risk to be shared more intentionally across multiple participants.

By providing patient, concessional capital, philanthropy can help unlock government funding and commercial finance that might not otherwise flow, enabling charitable capital to contribute to a larger solution.

“Will the additional complexity really make enough difference?”

Blended finance is undeniably more complex than writing a grant.

But Rowan Foley from Aboriginal Carbon Foundation reminded us why that complexity can sometimes be worthwhile.

His observation that cultural fire management is “a very new approach. It’s only 65,000 years old” (48:30) drew laughter, but it also made a serious point.

The value of Indigenous-led carbon projects isn’t measured solely in carbon credits.

These projects can support healthier Country, Indigenous employment, biodiversity, cultural knowledge and long-term partnerships between First Nations communities and corporate Australia.

As Rowan later put it:

“It’s not just giving; you actually are investing and getting a return on that investment.” (50:30)

Likewise, Matt Pfahlert from the Australian Centre for Rural Entrepreneurship wasn’t seeking capital simply to support another community project.

He was seeking investment to help communities own the assets that shape their futures, from pubs and petrol stations to community hubs and local enterprises.

The ambition wasn’t short-term activity.

It was long-term resilience.

As Matt explained during discussion, sustainable change happens through “an anchor organisation” that communities can build around (1:08:33).

Both presentations suggested that the additional complexity of blended finance may be justified when it helps achieve outcomes that are difficult to realise through grant funding alone, including stronger local economies, community ownership and enduring environmental stewardship.

“What if our foundation is too small?”

This question wasn’t raised directly, but it echoed throughout the day.

For smaller foundations, it may be one of the most important questions to consider.

None of the organisations were looking for a single funder to solve the problem.

One Education Foundation is seeking blended capital.

Women’s Property Initiatives is assembling multiple layers of finance.

Aboriginal Carbon Foundation is building a revolving facility.

ACRE is establishing a fund that brings different forms of capital together.

In every case, philanthropy is one contributor within a broader capital stack, not the entire solution.

That should be encouraging for smaller foundations.

Blended finance is not reserved for large institutional investors. It can create opportunities for organisations of different sizes to contribute according to their appetite, capability and mission.

A different question

Perhaps the biggest takeaway from Market Information Day wasn’t that every foundation should become an impact investor.

Rather, it was a reminder that philanthropy has a growing set of tools available to pursue its mission.

Grants remain indispensable and will continue to play a vital role.

Yet for organisations that have already proven their models, or where catalytic capital can unlock larger pools of funding, investment may help achieve outcomes that grant funding alone cannot.

The question for foundations may not be whether to choose between grants and impact investing.

Instead, it may be whether some part of their capital could be deployed differently to help proven solutions create even greater impact.

Register for the next upcoming Market Information Day, to be held 12 November 2026 in Perth.