Zadok Prescott, Nehemiah Network


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Zadok Prescott, Nehemiah Network

  1. 1. Code-P1Small Business Incubatorcase studyMay 2012Zadok Prescott
  2. 2. Nehemiah Network is a double-edged vision, helping the poor bysupporting small NGOs and growing small businesses The The advantaged advantaged T BN f oc us Small Business Small incubator NGOs Those who can’t help The disadvantaged The disadvantaged Those who can themselves help themselves P2
  3. 3. The thinking behind the process for the Small Business arm of NNcame from a few home “truths” about small businesses The vast majority of people need a job –1 only a small percentage of people have the necessary characteristics to run a business Even if someone has what 1. Training2 it takes, it does not come without two key things: 2. Experience Cash doesn’t answer business3 problems, but once problems are fixed, capital is often needed kick-start growth P3
  4. 4. To create sustainable impact, we need to identify realentrepreneurs with the potential to grow a real business P4
  5. 5. Once we’ve found them, we need to give them much more supportthan the traditional micro-finance offering Identify Entrepreneurs Mentor or Train & create Partnership Business Plan Loan or Investment P5
  6. 6. Business Process Animation Publicise Nehemiah Network Publicise P6
  7. 7. Business Process Animation Applications Nehemiah Network Applications P7
  8. 8. Business Process Animation Applications Filter: Nehemiah assessment of applications Interview candidates P8
  9. 9. Business Process Animation Interview candidates Nehemiah Interview Business training candidates P9
  10. 10. Business Process Animation Business training (Produce Business Plans) Nehemiah Assessment of Business plans Investment in businesses P10
  11. 11. Business Process Animation Nehemiah Mentoring and partnership to grow businesses Investment in businesses P11
  12. 12. Can this intensive support approach be sustainable? ► As this ‘due diligence’ and ongoing support is a costly and time- consuming approach, we need to have a long term sustainability horizon. ► The standard micro-finance business model cannot afford the quality of support that we believe will create sustainable change – the level of interest required would be unmanageable – Group savings schemes can only take you so far... ► We are investigating a model of equity investment – or partnership, whereby the micro-finance organisation takes a stake of ownership in the small businesses, and is therefore much more focussed on growing real, scalable businesses, rather than supporting cottage industry P12
  13. 13. In the short-term, philanthropic capital is needed to launch theprocess, but as the businesses grow, this could become a pipelinefor a more traditional equity investment fund Philanthropic funds N.N N.N. selects entrepreneurs with viable, scalable business plans and invests Share of Profits Businesses to sustain N.N. Entrepreneur has option With N.N. investment and to re-invest share of support, businesses profits to buy more create profits equity (which grows business) Profits P13
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