"The more social issues are solved, the greater the returns... The essence of impact investing is '+α'"

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"The notion that impact investing sacrifices profits for social responsibility is a misconception. On the contrary, by using innovative technologies to address urgent social and environmental challenges, we can create larger markets and achieve higher returns (alpha)."

In an interview with Money Today's startup media platform 'Unicorn Factory', Lee Deok-jun, CEO of D3 Jubilee Partners, explained the essence of impact investing in this manner. D3 Jubilee Partners is a venture capital firm that pursues 'impact alpha'—simultaneously generating social value and financial returns through innovative business models.

_NAME_0__ has focused on identifying 'unsung impact' companies that inherently generate impact, even if they do not explicitly brand themselves as social ventures. Representative examples include ThreeBillion, a gene analysis AI company, and Sendbird, a fintech firm specializing in cross-border remittances.

_NAME_0__ stated, "The rare disease diagnosis market, once ignored by big pharma, has become a massive opportunity as AI technology has driven down the cost of genetic analysis. As a result of investing in ThreeBillion based on its potential, we were able to achieve returns exceeding five times our investment and successfully exit."

Regarding Sendbird, he added, "By significantly reducing remittance fees for marginalized groups such as foreign workers from 5–7% to around 1%, the company attracted a large user base. It has now grown into a fintech firm handling B2B payments, with total transaction volume reaching 4–5 trillion won."

_NAME_0__ explained that these companies are not ones that fail to generate profits due to an overemphasis on social impact. He stated, "Business models that deliver inclusive and accessible innovation benefiting ordinary people across all industries—without leaving any group behind—ultimately create larger market opportunities."

D3 Jubilee Partners is also concentrating on identifying companies in the cleantech and energy/infrastructure sectors. Key areas of interest include managing the surging electricity demand driven by semiconductor and AI advancements, as well as power grid infrastructure essential for transitioning from fossil fuels to renewable energy.

Pion Electric, which develops devices for stabilizing power grids, is a major portfolio company. _NAME_0__ explained, "To seamlessly integrate renewable energy into existing power grids, infrastructure that supports the flexibility and stability of the grid—such as voltage regulation—is absolutely necessary. We invested proactively in this company because it creates key solutions to address bottlenecks in the energy transition process."

Additionally, _NAME_0__ participated as an early investor in Rico, which has digitized food waste collection systems. Through investment firms under global furniture giant IKEA, Rico has raised over 500 billion won in funding. _NAME_0__ noted, "Recently, we have also been paying attention to domestic nuclear fusion technology companies in similar fields."

_NAME_0__ identified the 'lack of structural support for scale-up' as a key limitation of domestic impact investing. He stated, "The sectors where impact companies operate typically have small initial market sizes, making global expansion essential when considering business scalability. Since they must prove their viability in overseas markets or overcome outdated domestic regulations to grow, their growth curves are inevitably flatter than those of conventional companies."

Tudo Works, which developed lightweight personal electric wheelchairs, took approximately seven years to gain recognition under the National Health Insurance pricing system. Due to domestic legal restrictions, insurance coverage was not applied, limiting domestic sales revenue. Similarly, Dot, a company producing tactile displays for visually impaired individuals, initially targeted overseas markets and now generates 90% of its revenue abroad.

_NAME_0__ stated, "To fully support the growth of impact companies, dedicated scale-up funds are necessary." He added, "Companies with slower growth rates often reach the profitability stage only to find their fund's maturity date has passed, forcing them to sell existing portfolio assets at low prices. Therefore, establishing secondary funds that acquire stakes in early-stage impact funds and growth funds capable of injecting large-scale capital is urgently needed."

To demonstrate that D3 Jubilee Partners can make long-term investments in impact companies while achieving financial performance, it plans to establish its own scale-up fund. Internally, this initiative has been dubbed 'Impact Investing Season 2.' The strategy focuses on intensively identifying scale-up stage companies capable of growing within five years. _NAME_0__ said, "By continuously producing successful cases of impact companies at the scale-up stage, we aim to prove to the market that they possess exceptional investment value."

[Money Today startup media platform Unicorn Factory]