‘Investing superheroes’: Here’s what to know about profit for purpose

At the Malmö Impact Summit investors discussed a maturing impact market—estimated at about $1.57 trillion globally with private direct and indirect investments reaching €190bn by end‑2024 (more than double 2022)—but which still represents only ~2.5% of European assets and faces a multi‑trillion euro SDG funding gap; climate‑focused deals have led flows ($234bn 2019–2025 YTD) even as inflows slow. Emerging trends include heavy interest in AI (used to scale impact and measurement and to optimize energy trading/monitoring) and a contentious shift toward defence and ‘peace tech’ and national‑security use cases, even as AI’s energy footprint (data centres used ~415 TWh in 2024, ~1.5% of global demand and likely to rise substantially by 2030) creates sustainability trade‑offs; sectors losing traction include food security, circular start‑ups and certain social services. The practical takeaway for allocators is rising institutional appetite (pension funds and family offices exploring allocations up to ~10%) but a need for catalytic capital and de‑risking instruments to mobilize mainstream capital at scale and to reconcile impact objectives with geopolitical and energy‑related risks.

Analysis

Impact investors at the Malmö summit signalled growing mainstream interest in the profit-for-purpose market, which the Global Impact Investing Network estimates at about $1.57 trillion worldwide and which saw private direct and indirect investments reach €190bn by end-2024 (more than double 2022); nevertheless impact strategies still represent only ~2.5% of European assets and pension funds and family offices are merely exploring allocations up to ~10%. Climate-related projects have attracted the largest flows—approximately $234bn from 2019 through 2025 YTD—but inflows are showing signs of slowing, while Dealroom and speakers highlighted that AI-enabled energy start-ups (energy trading and monitoring) are currently drawing the most investment within impact themes. The summit flagged emerging tensions that matter for allocators: AI’s carbon trade-off (data centres consumed ~415 TWh in 2024, ~1.5% of global demand and are projected to rise significantly by 2030) and a contested move toward defence and “peace tech,” which is gaining momentum even as many impact investors resist counting defence-related technologies as impact. Market participants emphasised structural barriers to scale—notably a large SDG funding gap (an estimated €4tn pa needed to meet targets) and the need for catalytic capital or de-risking instruments to mobilise mainstream capital and reconcile impact with geopolitical and energy risks.

Key Decisions for Investors

• Consider selective exposure to AI-for-good and energy-tech strategies focused on energy trading/monitoring where dealflow and capital concentration are highest, but underwrite energy-efficiency credentials and prefer managers disclosing data-centre energy sourcing
• Allocate modest incremental capital to climate action, affordable energy and sustainable cities via staged or blended vehicles given large historical flows and policy support, while monitoring the recent slowdown in inflows and measurable impact metrics
• Avoid or take a conservative, governance-focused approach to defence and peace-tech opportunities until clear impact definitions and reputational safeguards are in place, recognizing the sector’s growing momentum but contested standing among impact allocators
• Prioritise fund managers and structures that use catalytic capital, guarantees or loss-absorbing layers to de-risk early-stage impact investments and enable potential scale-up by institutional allocators