2. jenny everett - ande presentation - colombia august 2010

8/8/2019 2. Jenny Everett - ANDE Presentation - Colombia August 2010

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Copyright - ANDE 2010

Foro Anual de Inversin

Bogot

18 de agosto, 2010


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Copyright - ANDE 2010 2

Overview

Introduction

State of the SGB Sector

ANDEs Role in the Sector


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Guiding Thought

Only by letting millions of entrepreneurs try newideas, to innovate, to create businesses that put

those ideas to work in a competitive and openway, only by doing those things are we going tobe able to tackle the worlds big problems.

-Angel Cabrera, Chair, World Economic ForumCouncil on Entrepreneurship


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SGBsSGBs

Small and growing businesses (SGBs) =

Commercially viable businesses

5 to 250 employees

Strong potential forgrowth

Likely to create economic, social, andenvironmental benefits


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SGBsSGBs Will Create

Impacts

Job GrowthWage GrowthRevenue GrowthNet Income GrowthNew ProductsCustomers Served

Suppliers Supported

EconomicEconomicBenefitsBenefits

Steady jobsIncreased incomesWealth creation

SocialSocialBenefitsBenefits

Social goods (glasses)Social infrastructure(toilets)

EnvironmentalEnvironmentalBenefitsBenefits

Reduce deforestationImprove air quality(LPG)

Leading To:

The Promise of SGBs


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Despite potential benefits, formal small business sectors inlow income countries are much less developed

1. Contribution percents are median values for income group Source: Ayyagari, Beck and Demirguc-Kunt, Small and Medium Enterprisesacross the Globe: A New Database, World Bank 2003; Dalberg analysis

18

57

0

20

40

60

80

100100

Low incomecountries1

100

High incomecountries1

Share of totalEmployment (%)

Other Sectors

Formal SME Sector

Informal Sector

16

51

0

20

40

60

80

100

Low incomecountries1

High incomecountries1

Contributionto GDP (%)

28

15

53

29

28

1553

29


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Financial Flow Schematic of SGB Sector

Social impactinvestment

Commercialinvestment

Grants for capacity

building

Blended capitalinvestment

Capacity buildingonly provider

Capital and capacitybuilding provider

Capital only provider

Small and growingbusinesses

Microfinanceprovider

Traditional

priv

ate equityprovider

Mediumbusinesses

Microfinanceclients

SGBSector

Private

Equity

Microfinance

$25k

$2m


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SGB investment funds by geography

Percent ofidentified SGB funds investing in key regions

18% 58% 6%

8% 20%

13%

Note: N=1 , does not include funds with unknown investment regions. Funds

investing in multiple regions are counted once for each regionSource: Dalberg analysis

Americas

Africa

Middle East Asia India

Central & Eastern Europe


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New SGB funds by year

Note: N= 13 funds, does not include 5 funds with unknown vintage yearSource: Dalberg and ANDE analysis

22

30

26

23

87

6

7

9

Number of new SGB investment funds by vintage year

200920082007200620052004200320022001


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Total fund size

Note:SGB target fund size does not include 36 identified funds for which target fund size is unknown; SGB target fund size includes funds willing to invest

$2M and funds with minimum investment size not available

Source: *Emerging Markets Private Equity Association (EMPEA);**Dalberg analysis; ***Mixmarket 2008

SGB investment funds versus Emerging Market

Private Equity and Microfinance Sectors (2008)

$0

$2m min.

Investmentsize targets

~67*

~7**

~32***Loan Volume per Year ($B)

SGB target

fund size ($B)

$25K min.

Emerging markets private equity market totalfunds under management ($B)

Microfinance


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What is ANDE?


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The Aspen Network of Development Entrepreneurs (ANDE) is a

global network of organizations that propel entrepreneurship in

emerging markets. Our members provide critical financing and

business support services to small and growing businesses thatcreate significant economic, environmental, and social impacts

in developing countries.


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Aspen:Aspen: a nona non--partisan organization whosepartisan organization whosemission is to bring together people whomission is to bring together people who

shouldshouldbe collaborating on societalbe collaborating on societalchallenges but would not do so ordinarily.challenges but would not do so ordinarily.

Network:Network: an interconnected group or systeman interconnected group or system

Development:Development: improving the economic,improving the economic,social and environmental welfaresocial and environmental welfare

Entrepreneurs:Entrepreneurs: individuals whose passionindividuals whose passionleads them to organize available resources inleads them to organize available resources in

new and more valuable waysnew and more valuable ways

What is ANDE?


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THE ANDE VISION

A thriving local SGB Community that addresses the finance, humancapital, market access, and enabling challenges faced by SGBs

A well functioning, growing and global SGB Sector that is creating andbuilding successful SGBs at increasing rates in developing

countries

Successful SGBs that demonstrate anattractive market and stimulate thegrowth of local finance and service

providers

Successful local entrepreneurs toserve as angel investors and

demand an improved businessenvironment

Long-term

Outcome

(15 yr)

Mid-term

Outcome

(10 yr)

Near-term

Outcome

(5yr)

Significantly increased prosperity for the people of the developing

world as measured by increased incomes, higher quality of life andsocial and environmental advances

Vision


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Who makes up ANDE?


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ANDE Membership: Diverse, Growing, Young, Global

1

Total Members: 93

Active in over 130Developing Countries

55% of orgs,

less than 5 years old


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ANDE Member Regional FocusPercent of ANDE funds and capacity builders

supporting SGBs by region

Note: Funds investing in multiple regions are counted once for each region; N=71

Source: ANDE member data; Dalberg analysis

54%41%

17%

17%30% 21%

35%

Americas

Africa

Middle East South and South East Asia

Central & Eastern Europe Central Asia East Asia


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ANDE in Colombia

AVINA Foundation

BiD Network

Calvert Foundation

CHF International

Endeavor

Financial Alliance for Sustainable Trade

Fundacin Bavaria

Fundacin Davivienda

FUNDES

Bill & Melinda Gates Foundation

Grassroots Business Fund

GrupoEcos

Inversor

Mercy Corps

New Ventures - World Resources

OTF Group

PymeCapital

Root Capital

Root Change

Small Enterprise Assistance Funds

(SEAF)

SNV

TechnoServe Inc.

Universidad de los Andes

1


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ANDE Members Sector Focus

Percent of ANDE memberinvestment funds andcapacity building providers with sector focus

Education 29%

Energy

70%

43%

Agribusiness/ agriculture 57%

Generalist

Health 30%

Water/ irrigation 36%

Note: Respondents could select more than one answerN= 70 funds and capacity building providers; Percentages based on number of funds and capacity builders, not dollars invested

Source: ANDE member data; Dalberg analysis


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ANDE Investment Funds: Target Return Rates

Percent of ANDE member funds

Note: N= , does not include 3 ANDE member funds that have not provided target IRR rangeSource: ANDE member data

0-5% 5-20%

6%

57%

10%

8%

4%

12%

Target return rangeAbove 20%

89% of ANDE members have social/environmental goals, in addition to financial targets


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ANDE Member Capacity Building Offerings

Business plancompetition

26%

Business plandevelopment

60%

Entrepreneurship/ basicbusiness skill training

73%

Establishing marketlinkages

76%

One-on-onementorship

77%

80%

Note: Respondents could select more than one answer. Only members offering some sort of capacity development are included.

N= 70 funds and capacity builders Source: ANDE member data

Individualized businessconsulting services

Percent of ANDE Members Offering


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ANDE Impact: By the Numbers

Capital Invested At least USD$ 30 million; 2500 investments Leveraged additional $1.7b in capital Cumulative Target Fund Size: $1.7b

Technical Assistance In 200 , at least $97 million

SGB Impact Employ more than 300,000 people Served 7 million customers


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ANDE Activities:

1) Knowledge Sharing &Networking

2) Training & Talent

Development3) Metrics & Evaluation

) Capacity DevelopmentFund

5) Advocacy & Education


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Whats Next for ANDE: Upcoming Activities

Knowledge Sharing &Networking

Training & TalentDevelopment

Metrics and Evaluation

Capacity DevelopmentFund

Regional Hubs 2010 Annual Conference Sep 29th Oct 1st

Sector update calls, website, directory

Investment Officer Training Orientation Training Train the Trainer Leadership Program

Impact Assessment Manager Promote Global Adoption of IRIS Metrics Conference

15 grants made in 2009-2010 Replenish CDF Funds

Advocacy & Education SME Landscape Report Roundtables with State Department; USAID


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In sum:

You can never deliver enough charity to give

poor people a decent life. Business is the only

sustainable answer to poverty; it gives people away to earn money to pay for a decent life

themselves.

R. Glenn Hubbard and William Duggan, The AidTrap


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2. jenny everett - ande presentation - colombia august 2010

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