Future Economy Lab
A NEW APPROACH TO BUILDING ECONOMIES
The Future Economy Lab (FEL) was launched in 2020 to innovate the way we finance the development of economies — and to pioneer new ways of growing inclusive and resilient economies. It recognizes the imperative to design with communities rather than only for them to ensure equitable outcomes. We believe that these outcomes can generate higher returns for both communities and investors.
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Our
Approach
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We begin by deeply understanding a particular system or sector, and then develop a common vision of our desired future state. We then collaboratively create the financial mechanisms and investment strategies to reach that goal. This community-centered design approach actively involves a wide variety of local stakeholders, including investors, government entities, entrepreneurs, and community members.
Language plays a central role in this process, serving as both an enabler and inhibitor of understanding, communication and most importantly, accessibility. Our approach intentionally readies all stakeholders to engage in meaningful dialogue, regardless of their level of finance expertise.​
Our Process
We begin by deeply understanding how capital is currently deployed in a particular sector and developing a shared vision of the preferred future state. We then collaboratively create the financial mechanisms and investment strategies to reach that goal.
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Envision
The FEL team and our partners kickstart our process together by defining the current state of capital in the target sector and developing a common vision of our desired future state of capital.
Define
We use various research tools—such as desk research, interviews, and landscape mapping—to understand the ecosystem's needs and challenges. We synthesize the data during sense-making sessions with partners and begin creating initial models of potential solutions.
Design
Next, we design new financial mechanisms and identify the need for complementary ecosystem development programming to address the gaps and catalyze new solutions to the challenges we’ve surfaced.
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Launch
Lastly, we launch these new solutions. We refine the financial and impact models in order to raise new capital mechanisms and begin new programs with the support and collaboration of the communities themselves.
Our
Labs
Future Economy Lab’s work spans across sectors and regions. We have tackled challenges in the economies of climate, public education and are starting to work in others. Our process-driven approach also works for building inclusive financial tools for whole industries like real estate or for specific geographies like cities or states. Learn more about some of our labs' findings below.
Learning to Earning
Ongoing
Globally, a staggering one in five young people are not engaged in employment, education, or training. Meanwhile, 87% of employers currently face or expect to face a skills gap. To address these urgent challenges, we are exploring the role of innovative finance in improving employment outcomes for young people. Our aim is to guide more underserved young people beyond skills training and into meaningful employment by increasing the flow of capital to initiatives that achieve enduring benefits for youth. Working alongside various stakeholders including capital providers, educational institutions, and community organizations, we are co-designing strategies that directly address these critical issues.
Our Collaborators:
Financing Gender-Smart Climate Businesses in Asia
Ongoing
Building on SecondMuse’s extensive networks and regional expertise through the Frontier Labs suite of programming and The Incubation Network, we will run a series of labs to address capital needs of gender-smart, climate focused, small and medium sized enterprises. Each lab will focus on a unique challenge, such as how to scale nature-based solutions or support informal workers.
Supported by:
Abundantly Investing in Girls and Gender Expansive Youth of Color
Ongoing
Alongside girls and gender expansive youth of Color (ages 13 to 24) across the U.S. and its territories, and with the support of a variety of stakeholders including capital providers, direct service providers like nonprofits and community organizations, government, and academics, we are co-designing financial mechanism(s) and strategies to increase investments to these young people and their communities that are designed with and not only for them.
Our Collaborators:
Collective
Ownership
Completed
While engaging capital providers, entrepreneurs, academics, philanthropies, and legal advisors across varying industries and organizational life stages, this lab is co-designing a financial mechanism(s) that unlocks greater access to capital and technical support while both reducing barriers and influencing existing systems towards supporting collectively-owned organizations.
Our Collaborators:
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Property Ownership for Small Businesses
Completed
By collaborating with small business owners, industry and ecosystem experts, and investors to understand the barriers to mortgage lending and opportunities to overcome them, we aim to co-create a financial instrument(s) for mobilizing financial capital and other resources to small business owners so that they can purchase property.
Our Collaborators:
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Canadian
Climate
Completed
Tailoring the complex landscape of climate finance to Québec’s entrepreneurs and investors requires a strong understanding of the provinces resources, entrepreneurial activity, investor culture, and political priorities.
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This Future Economy Lab engaged over 50 organizations in a research and design phase which resulted in CLIO, a $50 million climate-focused blended finance fund, paired with an ecosystem program to support the development and growth of climate innovations and entrepreneurs, while promoting equity, diversity and inclusion across the climate economy. The fund is being raised and deployed in 2021.
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Learn more about the process and the initial financial mechanism design.
Our Collaborators:
Education
Completed
The K-12 and postsecondary market is ripe for transformation. But there are structural issues and barriers to increased investment and equitable solutions in the sector – particularly for entrepreneurs of color, women, and other marginalized populations who are more likely to use public education themselves.
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This Future Economy Lab identified 14 building blocks for transforming public education investment equitably and sustainably and used these principles to design two preliminary interventions in the education market. What we discovered in our process was that additional venture capital was not needed in this sector but instead more diverse types of capital such as character-based loans or revenue-based financing models, programming to provide holistic support to entrepreneurs, and better impact measurement businesses in the education sector that prioritize better educational outcomes and reaching a diverse student population.
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There are ongoing conversations around programming to support existing fund managers and entrepreneur support organizations to integrate some of our findings in their work.
Our Collaborators:
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New York Climate
Completed
Through engaging a diverse group of investors as well as a large entrepreneurial community in partnership with our Venture for Climate Tech program, this lab sought to identity what financial mechanism could create a sustainable ecosystem around early stage climate technology innovation and innovators.
Our Collaborators:
Interested in learning more?
If you’d like to work with us to innovate and deploy capital and
programming to catalyze the growth of inclusive and resilient
economies reach out to us at future.economy.lab@secondmuse.com