This post was originally produced for Forbes.
“I was raised by two hippie parents in a remote area of Alaska about 45 minutes from Fairbanks. They would have probably died at the time if they had been told I would end up in a career in finance,” Nystrom says.
She graduated at the top of her high school class and then from her engineering class at the University of Virginia. Still, she says, “I was a first-generation college student with no idea about professional jobs in the real world.”
Modestly, she says, “I certainly had not been groomed for a career in the financial industry and was pretty rough around the edges, probably still am. Walking and talking a certain way to please others has never been a strong suit and I have a visceral negative reaction to authority, rules and bureaucracy. So by default, I had to become an entrepreneur.”
She did join Ewing Bemiss & Co., an investment bank based in Richmond, Virginia.
“I realized after two years of working in investment banking that if I was going to put in 70 hours a week of work, I better be able to sleep at night knowing that I was making meaningful contributions to society. But instead, I felt unfilled and almost a traitor to my liberal hippie roots.”
She decided to go back to school to earn a master’s in public health. She still remembers growing bacteria in her apartment fridge for a microbiology class. “I have always had a deep personal passion for improving our health care system through a focus on wellness, and particularly through food and nutrition,” she adds.
In her own words:
I joined SJF as an Analyst in 2007, when the firm looked a lot different than it does today. We had just closed our second fund which was only $28 million and had an allied non-profit, where we spent part of our time providing technical assistance to underserved entrepreneurs. Everyone at SJF had to be a scrappy and resourceful back then because we were still proving our returns and impact investing thesis in the market.
When I joined SJF, I thought I would only stay for 2-3 years and then go back to public health grad school. Fortunately, I realized that I could scale my passion for health through the venture capital platform and now lead our Health & Wellness investment practice.
When the firm was founded in 1999, it was a pioneer in the impact space. In fact, the phrase “impact investing” was not yet in wide use. Still, she notes, that despite the growth in the space over the past two decades, “the amount of capital allocated to impact investing is still a drop in the bucket compared to traditional investment vehicles.”
She doesn’t subscribe to the notion that impact investments should yield lower returns. “SJF Ventures, together with other peer impact managers, is working to prove that one does not need to sacrifice returns in order to feel good about where one is allocating their wealth.”
In fact, she says, “We believe that those companies that are building sustainable products and services that drive positive environmental and social change will actually be among the strongest performers in the current and future economy.”
Chris Nicholson, CEO and co-founder of mPulse Mobile, one of SJF’s portfolio companies, agrees.
“During the investment process we were very impressed with not only their business and market knowledge but their focus on purpose-driven investments – I believe they refer to them as ‘impact investments,’” he says.
Mission compatibility made the investment a good fit, he says. “Our strategies aligned very well because one of our key focus areas is providing access to health care services and information to underserved populations as well as a focus on improving healthcare outcomes through improved dialogue between healthcare entities and consumers.”
SJF makes series A investments in three primary areas:
While they invest in these areas, she says they look for managers who are truly aligned with the firm’s mission. The firm also looks for companies that have hit an inflection point for growth and typically have over $1 million in annual sales already.
She sees competition for good investments. “There’s no doubt there is a lot of capital out there right now. So, it is a good time to be an entrepreneur. It’s a good time to raise capital.”
Nystrom serves on the board of Solera Heath, one of the firm’s portfolio companies. She excitedly effuses over the potential the company has to stem the epidemic of type 2 diabetes in the United States by providing preventative treatments before patients who are at risk receive a diagnosis and also to help those who do receive a diagnosis to make lifestyle changes to treat the disease.
She notes, “It’s been well documented–many studies, evidence-based medicine–that if someone can lose five to seven percent of their body weight they can reduce their risk of developing diabetes by 60 percent or more.”
That passion to make people’s lives better may have found a surprising home, but 4,000 miles and 20 years from home, she’s still true to the values she learned in Alaska.
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