Mixing economics and scientific research is not a new field, but it has increased significantly with the Digital Era and the ability to stretch funding opportunities globally. This rise in impact investing has also brought with it the need for the term ‘impact’ to have quantitative measurements behind it because, ultimately, it’s a quantitative idea, but when money is tied to its output, there must be a standard form of assessing the implications.
With so many funding sources having a vested interest in the overall impact of the research they are backing, a need for consistent measurement through database providers was created. Financial and social gains regarding research impact are partially determined by the unbiased, informative science of data, as formulas continue to evolve that assign quantitative attributes to qualitative ideas.
What are Impact Investors?
In every industry, researchers are integral in determining the answers to questions that can drive future steps, ideas, and innovative products or solutions. However, this research has costs associated with it, including overhead, salaries, and equipment. When the research correlates to an investor’s goals and interests, they may step in to cover the costs as an impact investor.
As the research they are investing in begins to take shape, the idea is that it will be used to get ahead of the current scope of knowledge in whatever field it is involved in. Many impact investors are interested in being the top of their industry in areas such as technology, economics, and healthcare, making these global categories popular avenues for investors to back the research in if they have the capital to fund them with the idea that any profit that comes from the results of the study going at least partially back to the funder.
Impact investing is a fine line for researchers to tread. On the one hand, it has influenced the ability for academics to expand globally by offering financial backing to researchers who might otherwise not have been able to afford to do the work. On the other hand, if an investor is putting their money into a project, they often also want to have a say in how the research is performed and how the outcome is revealed.
Types of Impact From Research
The intent of research is almost always to find an answer to a problem that helps create a better way for that idea to be addressed or gives people more knowledge on the subject than they previously had.
To this end, there are multiple types of impact that could be generated from a successful research experiment, like:
● Further understanding of cultural differences
● A change that helps the economy, either directly or indirectly
● Results that showcase a method of addressing the concerns in the environment, such as using renewable resources as a form of energy
● Answers that create a short-term or long-term impact in society, locally or widespread
● Ideas that could generate changes in policy or influence decisions of the policymakers
● Solutions to improve the overall health and wellbeing of a population of people, such as answers as to why a disease acts the way it does or a medication that can limit or inhibit symptoms
● Technological innovations that drive change globally, either through product development or intellectual properties
All of these impacts have the potential to be significant and bring a return on investment that makes funders more likely to be willing to back the research from the beginning.
The Types of Research Methods Used to Collect Impact Data
Collecting data on the research must be a neutral process. When there is a lot riding on the results of a researcher’s work, numbers must take over where judgment can be a gray area.
Common data collection methodologies that are neutral include those with principles that focus on ideas such as:
● An estimated impact, where pre-investment ideas are determined prior to the initiation of the research
● Planning impacts that include metrics and data collection methods during the research process
● Monitoring of impact potential as the performance of the research is analyzed after it is published
● Evaluating the impact itself using quantitative formulas and results obtained from database providers to determine the overall outcome and impact of the investment
With these steps in place, impact investors have a general idea of how their research opportunity is going, and the final judgment of impact relies on numbers obtained from a neutral database provider resource.