Here are three very different companies—a company that makes rice burgers from Fukushima rice; a company that produces soap from seaweed; and finally a company that uses a disabled workforce to distribute meals to the sick and elderly.

What do you think unites the three of them?

The answer is that they are all social business start-ups established by social entrepreneurs in Japan’s Tohoku region in the northeast, following the devastation of the March 11 earthquake and tsunami.

The primary goal of social businesses like these is not profit; their goal is positive social impact—to create jobs, to empower the disadvantaged, and to reinvigorate depleted communities.

Many small and medium-sized towns in Japan’s northeast are still struggling to regain their viability almost five years on from the disaster. The destruction of physical infrastructure (houses, factories, fisheries and farmland) and delays to the rebuilding effort have only accelerated a trend of younger people moving to big cities. Communities are badly hollowed out.

If any region in Japan needs the benefits that social business can bring, it is the northeast.

Unfortunately, social businesses come with their own set of challenges.

As a rule, social businesses are far from robust. They tend to be (a) small in size, (b) dependent on a volunteer workforce and (c) reliant on donations for their working capital. That is hardly a recipe for long-term sustainability.

Nonetheless, a small proportion of social businesses have business models that are both viable and scalable. However, they need capital to achieve scale and maintain momentum.

Where can social businesses go to get this capital? The venture capital industry? Hardly. In my experience, VC money flows to fields like biotech, AI, robotics and the Internet—areas where high risk is balanced out by high return.

Social investment is the opposite: it is middle to low risk, and low to no return.

But return on capital is not what social investment is about; it’s about social return. It’s about contributing to the public good—something that ultimately benefits us all.

The concept of social return started gaining traction after the recent financial crisis triggered catastrophic real-world outcomes. What if financiers, whose selfish behavior caused the crisis, directed some of their wealth and intelligence to doing good? What if capital markets broadened their two-dimensional approach by adding impact as a third dimension alongside risk and return?

British Prime Minister David Cameron addressed this change in values when he set up the Social Impact Investment Taskforce at the 2013 G8 Summit. The mission of the Taskforce is to explore how to “catalyze the growth of a global market for impact investment.”

The Taskforce Chair is Sir Ronald Cohen, a pioneering UK venture capitalist. As part of his global evangelizing, Sir Ronald came to Tokyo to deliver a speech on social impact investing (SII) in May 2015. I took the opportunity to have a chat with Sir Ronald. (Our companies had established a joint fund in 1999, so we were already friends.) “Why don’t you set up Japan’s first SII fund yourself?” he told me.

I need to backtrack a little here. In 2011, I had already set up KIBOW Foundation (“rainbow of hope” in Japanese) to channel funds to the rebuilding of the northeast. KIBOW has so far raised over $1 million and awarded grants of $1,000 to $150,000 to more than 100 social entrepreneurs.*

In his speech, Sir Ronald stressed that effective social investment comes from combining the idealism of social entrepreneurship with the practical know-how of venture capitalism.

In other words, layering venture capital funding on top of KIBOW’s grants would boost the chances of our being able to create viable, large-scale businesses with a positive impact on the northeast.

I set up a fund of $5 million in September 2015. The fund makes investments of $100,000 to $500,000. Our investment target is simple enough: it’s “anything that traditional VC isn’t interested in.”

The firms I listed in the first paragraph—the rice burger maker, the seaweed soap maker and the meals-on-wheels distributor—are all companies that the fund has either invested in or is taking a look at.

Like everyone in Japan, I want to do what I can to revive the battered northeast.

As the name suggests, social impact investing can have a real…impact. You may not make any money out of it, but it pays unbeatable emotional dividends. Doing good for society is rewarding for everybody—and that, as the Mastercard advertisements say, is “priceless.”

*Note: US dollar amounts in this article are calculated based on an exchange rate of 100 yen = $1.00. This gives us simple, round numbers. Actual dollar amounts at the present exchange rates are about 20% less than shown here.

photo:elwynn / shutterstock