Jason Ingle, Founder and Managing Partner of Third Nature Investments

Elysabeth: It would only make sense that I bring on my guest today. An expert in investing in systems transformation, Jason Ingle, Founder and Managing Partner of Third Nature Investments. Jason, thanks for being with me today.

For a real system shift, you’re going to need many investors, I believe, to move the needle, but it is growing. You’re not the only one now thinking of systems shift. It’s something I talk a lot about on this show. We ourselves at VegTech Invest, we’re also looking at a way of investing for a system shift. For us, what we find so hopefully is when you take this perspective, you’re really talking about solutions-oriented investing.

Now, to me that does not mean, and I’m curious for you what it means, but to me it has never been concessionary investing. So while I am passionate and it does have meaning for me personally to invest in food systems, I’ve never looked at it as a concession because when I look at moving the entire system, I see it as the solutions-oriented business opportunity because the system is so large. There’s so much money to be made in moving an entire system. Would you agree?

Jason Ingle: Well you know, we are capitalists because we know that philanthropy is unfortunately a small part of the large pie of capital that flows around the world. Again, we are market-based, market-driven investors. So we believe that while there is a role for policy change, philanthropy, etc., real true capitalism is a big part of this.

I would say the idea around money making is this is the single largest investment opportunity of humankind, right? The idea of saying that the 20th century economy provided amazing results for many, right? We’re not where we need to go. We know we need to go beyond profits and move towards prosperity for everyone and for our planet that is so kind to allow us to be here. So how do we now move from a 20th century economy with the knowledge, with the entrepreneurship, with the innovation that we now have and hopefully the wisdom and actually create a 21st century economy that is much more regenerative in nature and restorative which we know has to be inclusive. That’s a huge opportunity, right?

So I hear you on that. I agree, that is a big part of it. But as you said, systems transformation is a tall order. It’s already hard enough to be a successful investor. I do agree. I mean, this is kind of our mandate. We need to go beyond. You know, originally it was around return base, then it was return and risk, and now it’s return, risk, impact, and then getting into actual true systems change, which is a lot.

So while it’s a tall order, the way that you invest and approach it, even from the get-go, has to deviate from the way that we’ve all learned finance. So sometimes people say, “Well, what does it take to become a really good systems-oriented investor?” I say that unlearning would be first, right? Literally just a beginner’s mindset, because we’re so ingrained and so entrenched in modern portfolio theory in the way that we de-risk investing.

If I’m going to de-risk the investment and feel like I have some kind of control over this investment I need to really evaluate either the fund manager or the company. So how do I do that? Well, I need to understand what their domain expertise is. What do they know and what stage do they invest in and what asset class and what’s their geographic scope? All these things give us this false sense of comfort that we know with the activities that are happening between geopolitical risk and climate change and all the other disruptions like the pandemic, which was an explanation point on how what happens in one corner of the world affects all the other parts. So unlearning is a big part.

Another really big important part of being a systemic investor is looking at mapping and really getting that illustrative effect, which sets the table for sense making. If you don’t understand the playing field, you have blind spots. I think in some ways that was one of our retrospective thoughts on our decade of food systems investing is that while we were trying to take a full supply chain approach, we did have blind spots and biases because we were only focused on that vertical, right?

So you end up kind of having a cause and effect issue where you say, “Oh well, this is what our priority is.” It’s not taking into account how it’s interacting and potentially impacting other systems. You’re seeing it a little bit now in climate tech. It’s a great thing that climate tech investing is having a strong uptick, but at the end of the day which we’ll talk about later, decarbonizing the atmosphere doesn’t allow us to go back to business as usual. We know that is only one part of some of the damaging effects that our modern market system has had.