How much change can you make with $1.5 billion?

A group of social investors and social entrepreneurs are about to find out.

More than 20 banks, foundations and individuals are pledging the $1.5 billion to fund social ventures. Backers, who made the announcement Wednesday, are hoping the pledges will not only boost a plethora of new businesses, but also help to encourage investors who are sitting on the sidelines to act. Additionally, they'd like to prompt the creation of new metrics to gauge the success of so-called impact investing.

"I think this is the tip of the iceberg," says Jean Case, CEO of the Case Foundation. "We know there are many organizations poised to make more and bigger commitments, but didn't feel like the timing was right today to come forward. I love that, because it gives us another bite at the apple, if you will."

A May report from J.P. Morgan and the Global Impact Investing Network tallied the amount of social impact money under management at about $46 billion. That's a 20 percent increase from the previous year, but still a tiny fraction of the capital markets overall. The $1.5 billion could actually represent more than three percent of all the money under management in socially-responsible investing--a pretty big chunk.

Kristin Groos Richmond, the founder of Revolution Foods, which delivers healthy school lunches to kids in economically disadvantaged school districts, says the announcement is "tremendous." She's most encouraged by its potential to buoy investors, some of whom are already doing some amount of socially responsible investing, to develop and adopt standardized metrics for impact investing. That'll make it easier to syndicate deals, and easier for entrepreneurs to give investors the information they want. "I think it's a revolution in investing," says Richmond.

A number of government agencies, including the U.S. Agency for International Development, or USAID, and the Small Business Administration, made pledges to renew or launch programs that will directly finance entrepreneurs, doing development and other double bottom-line work. "Business is actually the solution," says Sarah Collins, the founder and CEO of Durban, South Africa-based Wonderbag, a non-electric slow-cooker. Through her "buy one, give one" model, she says 800,000 of the non-electric slow cookers are in use, many in the developing world. "A lot of money has been spent on aid that is non-productive money. It would be much more productive to put that money into entrepreneurial efforts and innovation that are going to have a groundbreaking impact on the world."

She offers one caveat. For entrepreneurs, once an investment is made, there's often little difference between social impact money and traditional investment. "People in the social impact world talk about having longer terms on their investments, or accepting lower returns," she says, "but the reality is that's not actually what occurs."

Wall Street vs Silicon Valley

Case says that when it comes to impact investing, the big banks and Wall Street firms are ahead of the financiers that support Silicon Valley. The banks, she points out, all have private wealth management offices. She says they're starting to get pressure from younger generations that want "more than just a negative screen on their portfolio," to exclude investments in say, tobacco, or weapons manufacturers. Instead, she says, they're pushing wealth management offices to get up to speed on impact investing. She points out that both Goldman Sachs and Bank of America have launched impact funds.

"Thus far, from Sand Hill Road, we haven't seen much action," she says, noting that investor Vinod Khosla and eBay founder Pierre Omidyar have been exceptions. She also says that Andreessen Horowitz has invested in AltSchool, which is pursuing certification as a B Corp, allowing it to include its sustainability goals in its articles of incorporation. Other notable B Corps have included Method and Warby Parker.

"You have more and more investors saying, we don't just want to deploy our funds, we want to solve a problem that we're passionate about," says Richmond. If that's the case, you'd expect Silicon Valley to be taking the lead.