Beyond Capital Fund is a social impact fund that invests in for-profit, seed-stage social enterprises throughout India and East Africa. We asked Ben Grozier, Operations Associate, to tell us more about the fund.
“Beyond Capital is a social impact fund that invests in for-profit, seed-stage social enterprises throughout India and East Africa. We invest in businesses that are focused on greater access to healthcare, water, sanitation and energy, as well as food security and financial inclusion, which can increase the quality of life and standard of living for consumers at the bottom of the pyramid. As is inherent in our name, we also provide “Beyond Capital” resources to social enterprises both in and out of our capital portfolio. Our “Beyond Capital” offerings include provision of pro- or low- bono legal and financial advisory assistance, as well as connection to our network of advisors and in some instances, involvement in our mentorship program.
Because we have such a lean team, my role within Beyond Capital spans a number of different areas – perhaps most relevant, I source and serve as an initial screen for many of the social enterprises that we review in our investment pipeline. Historically, these opportunities have come from a variety of places, people, and platforms, so it is ideal to have a centralized location with so many businesses relevant to the Beyond Capital investment mandate.”
What are you looking for on IBA.ventures, and what is the investment focus of Beyond Capital?
“Frankly, we are looking for our next investment! That will be a business directly improving the lives of consumers at the bottom of the pyramid, which we also believe can generate market-rate financial returns. Beyond Capital aims to fill the capital-gap that exists for high-risk, early-stage social enterprises. We hope our capital will help de-risk a business and scale it to reach the crucial Series A, B, C rounds and beyond.”
Which investees of Beyond Capital are you most proud of, and why?
“We are proud of, and enthusiastic about, all of our investees – otherwise we would not invest! However, for the sake of writing about just one – Frontier Markets, led by Ajaita Shah, and based in Jaipur, India has been maintaining its strong momentum of late. Frontier Markets is a rural marketing, sales, and service distribution company providing access to affordable and quality consumer durables to low-income households throughout Rajasthan. To date, Frontier Markets has delivered over 125,000 clean energy products ranging from lanterns, to home lighting systems and solar inverters, through 800 retail points.
Perhaps more notably, however, Frontier Markets has had a dramatic impact on the lives of women in rural India. In addition to the tens of thousands of women empowered by Frontier Markets’ products, the Company has 250 female “Solar Sahelis” who serve as local entrepreneurs and advocates for Frontier Markets on-the-ground. Frontier Markets was recently recognized in National Geographic’s Great Energy Challenge, and received the Ashden Award for Clean Energy for Women and Girls. The Company also closed a Series A round with Acumen at the end of 2015. All systems go for Ajaita!”
What does “impact” mean to you when we are talking about “impact investing”?
“In our eyes, impact investing is about supporting the long-term economic development of consumers at the BoP. While it is hard to judge “impact” with this lens, we look for indicators that teach us about the long-term effects of our work. For Beyond Capital, one of those metrics is the follow-on capital our investees raise. If we are meeting our investment mandate, then by filling a capital gap, we help strong teams reduce their risk profile and make them more attractive to investors in later rounds.
There are two ways to support sustainable economic development at the BoP. A lot of attention (and development funding!) goes to the top-down approach tackled by governments and the larger international development agencies. We remain excited by the increased attention paid at the other end, to impact investing and the “bottoms-up” approach to economic development for this under-served population.”
For the ventures registered on IBA.ventures, what would be your main advice to those looking for an investment from Beyond Capital?
“My main advice would be to make sure they can very clearly and plainly describe a path to profitability for the business. We know our investees are early stage, but we expect our management teams to be rigorous analysts of their own business models and to clearly understand and elucidate the scaling process and path to sustainability. The better an entrepreneur knows and can explain that path, and the ins and outs of getting there, the easier it is for us (and other investors!) to feel confident in the business.”
Ben Grozier is an Operations Associate with Beyond Capital Fund. We thank him for his contribution.
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