The Social Capital Index (SCI) tracks investments in the social capital market, including social enterprise, fair trade, digital inclusion, and selected clean tech and microfinance investments.
The July edition of DealSpace brings you $206 Million worth of new equity investments and $130 million worth of debt and grants in the social capital market space. A first-mover and forward thinker to the core, Google is not very different in its grant making philosophy. Google.org recently made a grant towards InSTEDD, a non-profit organization focused on improving response systems to global health threats and humanitarian crises. Following up on the BOLD deal from our last issue, one of our featured debt investments this month is another groundbreaking transaction where the Micro Finance Bank of Azerbaijan raised $25 million in debt from international capital markets. This is the first time an Azeri issuer and a single microfinance lender has issued debt paper in international markets. Also, in June OnDeck Capital secured a $100 million credit line connecting Wall Street to small and medium business investing. Our equity investments this month range from investments in green tech with a tangible social impact to recent transactions in the microfinance space. Most noteworthy were investments made by Aavishkaar Goodwell in two Microfinance Non-Banking Financial Companies in India. We also mention the oversubscribed SNS Institutional Microfinance Fund from last year which strongly reflects the growing shift of investment sentiment towards earning good returns while still having a conscience.
We have always maintained that even though clean and green ventures are good examples of responsible investments, they do not often fall within our scope of socially based private equity deals. However, the July edition of Deals In Play brings to you two very distinct examples of enterprises that fall in to both the green and social space. Third Energy is an alternative energy enterprise with not just an environmental mission, but also a very unique and potentially widespread social impact. Equally compelling is the Potenco solution to the energy requirements of the developing and rural world. If you are not excited yet, you will be when you read about the business model of Maya Organic for training and building micro-enterprises in India and the impact it has had on scores of rural artisans and entrepreneurs. The techniques of Collaborent for co-sourcing saves municipalities and local governments not just money but precious time and resources that can be redeployed for the better good. We cap off this edition by introducing to you a socially responsible real estate firm that focuses on quality affordable housing opportunities, the 908 Development Group. By providing high quality housing to those who would other wise be close to homelessness, they provide a tangible product that positively touches the lives of low incomes families and individuals.
Below is the SCI asset class fan, which shows a spectrum of the asset classes included in the SCI, from equity to debt and including grants. Eventually we will categorize the entire Index using this fan. The full fan is available here. Also available is the fund matrix, where various social funds are described in more detail. Like all the rest of the resources in the SCI, it is a work in progress, and will become fuller and more complete over time.
Mobile payment systems are turning out to be a truly disruptive technology in Kenya. The great success of M-Pesa, the now prototypical example of mobile payments, has the banks frightened, at least according to an article in the Nairobi Star. But Kenyan blogger Bankele calls for a truce: "Banks need to change and embrace M-Pesa as it is able to do some things they can't or won't do." According to Bankele, the alternative is not pretty:...take away m-pesa and people will go back to stuffing cash in tins, rolling them in blankets and mailing them in cartons on buses. They will not go back to open new bank accounts or queue at western union.(Hat tip: Elia Varela Serra at Global Voices Online)
World Bank data show a strong correlation between measures of entrepreneurship and income. But how does this relationship come about, and what drives what? Abhijit Banerjee, of Poverty Action Lab fame, gives his take:It turns out that the businesses of the poor are also poor businesses: The typical business has zero paid employees and no machines in almost every country where we have data and where we have the information to be able to calculate this, what the household earns from the business is less than what they would earn on the lowest end of the labor market. They are in effect buying a job and not [a] particularly good job at that... ...The problem is that for a business to rise beyond its many competitors?the thousands of fruit vendors in Chennai---it has to have something special about it: The product (P) must be different or the quality (Q) must...
This past October I participated in a 2-day Mobile Money Summit in Port Moresby, Papua New Guinea. Why Papua New Guinea? There is growing interest among telecom companies and banks there in mobile financial services. Although the meeting was attended by more than 50 people from around the Pacific, the majority of the participants were from companies doing business in Papua New Guinea. IFC cosponsored the event, along with the Asian Development Bank, Bank of Papua New Guinea, the Business Council of Papua New Guinea and the Port Moresby Chamber of Commerce and Industry. The topics discussed reflected the variety of participants ? an overview of mobile banking, regulatory discussions, and success stories from the region. Bank South Pacific also provided us with a demonstration of a mobile banking service. And I spoke during a session on New Solutions: Engaging with Customers and Creating Compelling Products, where I presented a...
I finally found the time to pick up a copy of Economic Gangsters and find out exactly how coauthors Raymond Fisman and Edward Miguel propose to defeat witchcraft. (See my earlier post on Fisman's presentation at the World Bank for background):[W]e think more foreign aid should explicitly play an insurance role for poor countries. We call this new type of aid Rapid Conflict Prevention Support (RCPS). RCPS aid would kick in for countries experiencing temporary income drops, in much the same way that it's better to see a doctor when you start getting sick rather than waiting for the infection to spread. By the time you've got pneumonia, it's already too late... ...Since sharp and unexpected income drops are the symptoms of conflict vulnerability, donors should time foreign aid to provide relief when these circumstances arise. And this is when RCPS aid would kick in. When underlying economic factors return...
Writing in the Ethical Corporation newsletter, Rajesh Chhabara recently opined on the near-term prospects for microfinance in Asia. Their take? Things are just hunky-dory:Despite the trouble in global financial markets, investors continue to put money into Asian microfinance. A $40m fund aimed at financing start-ups in microfinance was launched in October by the India-based Institute for Financial Management & Research Trust, supported by a group of investors including India?s Icici Bank. In May, ASA International of Bangladesh, ranked number one on the Forbes list of top 50 microfinance institutions, raised $125m in funding ? the largest ever by a microfinance institution ? through private equity firm Catalyst Microfinance Investors... Diverse sources of funding and a sustainable business model mean the microfinance sector is well placed to withstand upheavals in the global financial markets. And the trend of banks and private investors putting more funds into the sector looks set to...
Adam Stein: Jubilant environmentalists trade high fives, carbon permits We tend to see a lot of handwringing over the fact that Europe has a carbon cap in...
WorldChanging Team: by Jay Walljasper During the holidays, people gather together with their families (parents, grandparents, siblings, aunts, uncles, cousins, close friends) for food and kinship....
Sarah Kuck: From the discovery of intelligent life somewhere else to a web-based revolution in education, certain future milestones seem to hold the power to change...
WorldChanging Team: As we look forward to the new year, we've also reflected on the old, and rediscovered some of the great events, innovations, interviews and debates...
WorldChanging Team: As we look forward to the new year, we've also reflected on the old, and rediscovered some of the great events, innovations, interviews and debates...
entities 
entities
I recently read an article titled