SOCIAL INVESTMENT FUND IN TUNISIA Positive impact and development through finance
Social Investing & Tunisia Social/Impact investing unlocks more capital for companies, funds and other vehicles that generate positive socialand/or environmental outcomes Venture philanthropy (VP) takes concepts and techniques from venture capital finance and high technology businessmanagement and applies them to achieving philanthropic and development goals. Social investing and VP are growing trends considering the ineffiencies of aids and donations: the number of fundsengaged in impact investing has grown quickly in the last five years, and a 2009 report from the Monitor Group, aresearch firm, estimated the impact investing industry could grow from its present $50 billion or so in assets to $500billion in assets within the next decade. This capital may be in a range of forms including equity, debt, working capitallines of credit, and loan guarantees. There is now an opportunity to bring social and venture philanthropy investments to Tunisia. The Diaspora can play an important role by investing in social funds to support their home country Social Return meeting Financial social needs in Return education, meeting health, access market to finance etc. requirements
What sort of fund? The money raised (from donors, social investors, foundations, development banks) to establish the fund will not be donated but invested in order to actively achieve social and environmental goals The fund can invest directly in social entrepreneurs with high impact on their communities (option 1) and/or can be used as a guarantee for loans to these entrepreneurs (option 2) as exposed in the following slides Social/Impact Social Positive Growth and Investing Entrepreneurs impact development
Option 1: Guarantee Fund Wealthy Individuals Guarantee for Micofinance loans insititution: ENDA Development organizations Social International Social Investment Investment Fund Fund Intermediary fund Leveraging Tunisian expats/ crowd sourcing Invested in Financial Markets(ex: 33needs.com, Microplace)
Option 2: Direct Investment Wealthy Individuals Seed Development Social Funds organizations Investment Fund International Social Investment Fund S&ME International fund ex: Maghreb Tuninvest Merchant Bank Intermediary fund Leveraging Partners/fund managers for Tunisian expats/ “risky” social enterprises crowd sourcing(ex: 33needs.com, Microplace)
How to select social entrepreneurs? To achieve “impact through finance”, the fund will target social entrepreneurs with high impact on society and environment, through competitions, acceleration programs, direct applications, regional networks, and incubators. Below are some representative examples of social entrepreneurs (fictional): Rached is starting Dev-Maghreb to Ahmed needs funds to start scaling offer development, consulting and up his Zitlamp, a prototype that financial assistance to associations converts waste from olive oil in Tunisia, Algeria and Marocco. The factories into a powerful source of services of his for-profit company clean energy. also include training and partnership building with development organisation in US, Asia and Europe. Alia is the owner of Artisanes , a Jamila is requesting financial company that manufactures and support to establish Transparency exports hand crafted bags and Desk, the first online advisory firm jewelry , with “fair trade” in Tunisia that is dedicated to certification, exclusively employing corruption fighting and bribery women from disadvantaged areas, reporting. from where the Tunisian revolution started.
What to do with the returns? As explained, investments will meet specific financial requirements. Returns might be sub-market but they will exist. We thought about 3 ways to handle returns. Option 2 and 3 would improve the social mission of the fund: Option 1: Back to the limited partners; Investments Option 2: Reinvested; Option 3: Given as grants to capacity building.
Reaching the Tunisian Diaspora This fund can be financed in a large part by enthusiastic and engaged Tunisian expats , who are spread accross Europe and North America. An effective web platform would be the best way to reach them! Crowdsourcing would allow to gather « small » participations from a large number of Tunisians abroad (like Kiva.org, Microplace, 33needs.com) Crowdsourcing would be one of the main innovations of the fund. Serious partners dealing with the Diaspora would allow an effective promotion
Reaching the Tunisian DiasporaPotential partners?: Project selected and Finalist :
Various incentives, Common Fund Tunisi[n @ro[^ Tunisi[n @ro[^ We assume that an established PE firm willFun^ M[n[g_r accept to assist in managing the fund for the following reasons: The Diaspora will be interested in investing in -Positive impact on its reputation which will the private sector development of Tunisia allow the firm to raise more funds for other instead of donating. They will appreciate being investments; reached through social media and web -It will allow the manager to build platforms. relationships with more entrepreneurs and capture future deals . So]i[l Entr_pr_n_ur Growing number of international investors are seeking funds that exclusively deal with The entrepreneurs are seeking for relevantInv_stor high social impact entrepreneurs. funds that have the expertise and the network Venture Philanthropists are willing to to leverage their social impact and their support international entrepreneurs that are innovative ideas. not attractive for “ordinary” funds: early stage, risky idea, small market etc.
Join the project! If you wish to know more and/or want to get involved, please contact: Hatem Mahbouli Tounesna Fund Project Manager firstname.lastname@example.org www.hatem-mahbouli.com Hatem Mahbouli is currently pursuing an MBA at Georgetown University, in Washington, DC. He has been involved in several projects to develop impact investing and Social VC with Ashoka, Grassroots Business Fund, 33needs.com and GrayGhost Ventures . Hatem has also a Master’s degree in Telecom Engineering and had worked for 3 years in Accenture, Paris Office.
General Overview Guarantee for Wealthy Individuals micro-credits MFI Ex: ENDA Social business Financial return competitions Development organizations Social Networks Investment Fund International Social Applications Investment Fund Social return PE and Social VC firms Banks Entrepreneurship Intermediary fundLeveraging Tunisian Center/hub expats crowd sourcing Development Partners/fund managers for Service Firms (ex: 33needs.com, risky social enterprises microplace) SOURCINGFUNDRAISING