There used to be a saying in the business world – “you’ll never get fired for buying IBM.” That might be surprising if you’ve grown up in a world where companies like Google and Apple dominate the tech space, but there was a time when IBM was so dominant in both hardware and software that it was the default choice. In some segments they were even more dominant than Google is in web search today. Yet today IBM’s revenue is falling by 5% a year and their medium-term survival is questioned by a lot of observers.
That took decades. But ask Blackberry how quickly things can change today. From 2009 to 2012 their market share in U.S. smartphones went from just under 50% to 2%. This year it rounds to 0%.
We don’t know exactly how fast electric vehicles will eat into the market share of internal combustion engines, or how fast artificial intelligence will develop, or what’s next in distributed generation and storage of energy. But technology trends like these could disrupt electric utilities, oil companies, financial services, retail - all investments that it seemed like you could put your money into for decades, which now seem increasingly risky.
So what’s an investor to do when change is so rapid and difficult to predict? And what if you’re striving to be an impact investor, which limits your choices even more?
On that point, the rapid pace of innovation is producing some good news. Not too long ago, impact investing consisted of trying to find one of the handful of ethical mutual funds that existed. But now there is a lot of disruption in the space. There are stock indices based on sustainability. There are crowdsourcing platforms to support start-ups trying to make social and environmental impact. And if you’re at the stage of investing where I am, prioritizing income generation and capital preservation, green bonds such as those offered by CoPower are an attractive and rapidly-growing option - offering a reasonable yield that can be maintained over time.
And another benefit – many of the things you can be investing in are causing all the changes that put more established investments at risk.
Much is written about the proportion of people looking for impact and meaning in their work lives, which is what prompted me to come work for Bullfrog. And because that’s where we spend so much of our time, that makes a lot of sense. But your money is working all the time as well – for better or worse. It’s a lot easier to change your investments than your career, and it has a huge impact as well. So if you’re looking for a way to make environmental and social impact today, and do what’s smart and safe with your money, impact investing is the way.
Sean Drygas is Vice President of Finance and Corporate Development at Bullfrog Power.
This investor testimonial was solicited by CoPower and may not be representative of the views of other investors.