It seemed like a good idea at the time: farming cassava in Mozambique to produce ethanol and bring safe, affordable cooking energy to communities that have traditionally relied on burning coal and other solid fuels, while also improving farming practices. Three billion people burn coal and other solid fuels for cooking, generating toxic smoke that causes an estimated 4.3 million premature deaths annually per the World Health Organization. This includes almost 600,000 deaths in Africa, primarily in sub-Saharan countries.

The entrepreneur behind the cassava ethanol start-up envisioned a scalable, self-sustaining ecosystem that would make money and save lives. The pitch found receptive ears among early-stage impact investors seeking ventures that generate financial returns and create sustainable social and environmental benefits.

Money came pouring in, but the intricate ecosystem never materialized. Managing the distribution of fuel tanks and stoves while ensuring timely refills for rural customers was unexpectedly complicated and costly. Ethanol production, alas, wasn't close enough to where the fuel needed to go and when the product wasn't readily available, changing existing habits was nearly impossible.

As impact investing gains popularity, many investors are driven by the desire to feel good, sometimes at the expense of commercial due diligence. To be clear, certain investors are in the business of taking gambles with the goal of de-risking a new business model or priming an ecosystem for commercial capital--an intentional concession of potential return in exchange for outsized impact. This is tricky business in a place like Mozambique where basic distribution infrastructure is non-existent and customers have been cooking the same way for generations.

At Blue Haven Initiative, a family office where I lead a $50-million direct equity investment portfolio, we seek to make high-impact, high-return investments in early-stage companies in frontier markets. The entrepreneurs in our portfolio are solving big problems with business models that intend to reach profitability, creating attractive market rates of return for both investors and themselves. We only target business models in which the impact is directly embedded; every product sold and every dollar in revenue translates to tangible, measurable benefit for the businesses and people served. Typically, we invest in a company's Series A round, writing $1 million checks to start, reserving heavily to increase our stake over time. This pool is one of the largest for early stage investments in sub-Saharan Africa, where rounds tend to be a fraction the size of their U.S. counterparts.

We do not believe there has to be a trade-off between impact and investment returns. The popular buy-one-give-on (BOGO) model can be both a compelling corporate social responsibility (CSR) program and employee retention strategy, but the impact inherent in these business models is tenuous. For instance, TOMS Shoes, most well-known for donating a pair of shoes for every pair purchased, is a great way to feel good when buying some cute shoes. However, rather than address the root of the problem--poverty and children who need footwear--in a sustainable manner, TOMS can actually further disadvantage the populations it relies on for its marketing strategy. In 2013, reflecting a more updated and sustainable version of impact, TOMS committed to producing one-third of its shoes in regions where those shoes are given away, potentially creating hundreds of jobs for the populations it cares about. That's much higher impact in our book.

At Blue Haven, we are in the enviable position of not having to build too narrow a view of impact. We believe that building basic infrastructure in the markets in which we work is just as transformative as providing solar lanterns to the poorest of the poor. That's a line that often gets me in trouble with impact investors who might not care quite so much about financial return or have a very specific view of what "doing good" means. We've looked at companies that do traditional logistics or provide basic payments infrastructure, both sorely underdeveloped on the continent, but wouldn't fit a stricter version of impact. In our existing portfolio, impact outcomes range from displacing dirty fuels like diesel and kerosene to increasing access to financial services for the underbanked to providing professional skills training to the employees of fast growing businesses across Africa.

An emerging class of impact VCs seeking top decile returns in private early-stage enterprises has raised $10 billion since 2010, according to TechCrunch. The enthusiasm and determination among entrepreneurs to build companies that improve standards of living, mitigate climate change, bridge gaps in infrastructure and deliver products and services to underserved communities is at an all-time high. The opportunity to get funded by impact investors has never been better. Here is some advice for tapping the growing pool of investors like us who consider impact in our venture portfolio:

1. Keep it simple

Ideas that are easy to describe and understand, especially in the context of less-developed markets, have more appeal than those that require elaborate PowerPoint presentations or wordy explanations. Too many moving parts and contingencies can put off investors that look for a clear and compelling value proposition.

2. Avoid complicated financial structures

"Alternative" structures are in vogue among some impact circles on the basis that impact companies require more patient capital and may never have an exit. We believe working within existing financial norms is more prudent. Unfamiliar securities can deter later stage, more commercial investors as a company scales. Our success depends on scale and access to much larger pools of capital over time. We seek out deals that allow equity investors and entrepreneurs to exit in a reasonable amount of time through proven (i.e. traditional) capital markets.

3. Emphasize impact metrics as well as financial performance

Entrepreneurs courting impact investors need to broaden their understanding of performance and accountability by demonstrating a commitment to quantifying social and environmental benefits. Be prepared to delineate non-financial metrics that illuminate impact and explain how the data will be obtained. However, most impact investors who care just as much about financial return look for metrics directly related to business outputs (i.e. greenhouse gas emissions reduced, savings per customer, etc.) to avoid burdening a team with excessive impact reporting.

4. Demonstrate engagement with customers

There is no sustainable, long-term business model unless customers are being offered a product or service they want and can afford. Especially in markets with underdeveloped infrastructure, firmly grasping the source and context of a problem in need of a business solution is only possible by spending time on the ground, interacting with customers and gathering intelligence.

5. Develop a nuanced perspective around technology

Although tech can certainly improve efficiency in geographies that lack good infrastructure, pure-play digital business models tend to be more appealing in theory than in practice. In sub-Saharan Africa, I've grown wary of the Silicon Valley mindset that thinks technology and ingenuity are all that's needed to overcome poverty. Execution is king and there are a hundred small realities that can't be "hacked" by tech alone.

As profit with a purpose is a mantra for many up-and-coming entrepreneurs, the need to solve big problems is gaining traction among mainstream investors. The global economy is increasingly driven by the billions at the base of the pyramid on a planet that needs saving and enterprises that tie financial health to the well-being of their customers and the environment will outperform. So will the investors and entrepreneurs behind them.