Fast-moving social enterprises, strapped for cash and time, face a conundrum when it comes to measuring social performance. Traditional measurement tools, whether inherited from international development or impact investing, don’t make sense. They are either too costly because they were designed for large-scale aid projects or focus on typical business metrics that don’t get to the heart of impact.  Lean Data^SM applies lean experimentation principles to the collection and use of social performance data. It involves a shift in mindset away from reporting and compliance and toward creating value for a company and its customers.

The companies we invest in are delivering critical products and services that enable poor customers to transform their lives. That’s why we’re laser-focused on rigorously tracking the ability of our investees to reach these customers and understand their needs. Our success is defined by how well our investments enable the poor to transform their lives.

While the standard approach in our sector is to gather metrics on numbers of people reached, we measure the social benefits people actually experience. That’s because we believe that creating outsized impact requires listening directly to end customers. To do this, Lean DataSM uses low-cost technology such as SMS, voice response and call centers, to communicate directly with end customers, getting high-quality data quickly and efficiently.

Working closely with our companies, we generate, analyze and use data that enables them to understand and, ultimately, improve their social performance. Our aim is to unlock the full potential of our companies in order to achieve the greatest social change for the customers they serve. And we use what we learn to become better investors

These customers know what is hard about their own lives. Every day they experience things that are frustrating or wasteful or broken. As a result, it’s not difficult for them to explain how their lives change when they get access to improved goods and services. We use Lean Data to help customers communicate what impact means to them and then build our measurement and selection of metrics on what they tell us.