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Wednesday, July 21, 2010

Grassroots Business Fund Celebrates Its Second Anniversary

By Manuel Bueno

The Grassroots Business Fund (GBF) recently celebrated its 2 year anniversary in a congratulatory mood. For those that are not yet acquainted with its work, GBF is a social investment fund that provides investment capital and capacity building to high impact social enterprises (we have profiled GBF's work here and here).

Although GBF became an independent nonprofit organization in 2008, it built on four years of experience as IFC's Grassroots Business Initiative (GBI), where it conducted over 40 projects impacting the lives of more than 3.4 million people living in low-income markets. It is estimated that GBI's clients provided basic social services to 1.4 million people and created close to 100,000 jobs.

This experience has had a deep impact in the way GBF strives to become a partner with its investees and tries to maximize its positive social impact, improve commercial sustainability and ultimately build a framework for further growth. Throughout the last two years, GBF has committed $8 million in equity, quasi-equity, debt, grant financing and technical assistance in its 25 investments. These investments have covered 10 countries in Africa, Latin America, and Asia and have reached almost half a million direct beneficiaries worldwide.

Moreover, in this short period of time GBF has become an active player in the social investment arena. It has contributed heavily to the field of metrics and evaluation (a longstanding bone of contention for social investors trying to measure their impact and legitimate their activities vis à vis other development actors) by implementing its Impact Planning, Assessment, and Learning (or iPAL) framework and measuring the Social Return Of Investment (SROI) of its investees, breaking ground with client surveys, and becoming a pioneer fund for GIIRS. Additionally, in June it hosted an internal capacity building workshop (covered here) bringing in several of its clients, staff and outside investors to help clients improve in the areas of financial management, investment readiness, and corporate governance. The findings for this workshop have been made public to everyone here. Previously, GBF had already co-hosted two other annual metrics conferences with the Aspen Network of Development Entrepreneurs (ANDE).

These last two years GBF has built a strong foundation for the future: setting up operational guidelines for its investments and developing a field presence in Nairobi, New Delhi, Accra, and Bangkok in order to ease the pipeline development process and enable easier communication with existing clients. Although much work remains to be done, GBF is expected to thrive in the years to come. For those of our readers who would like to stay in touch with the organization I recommend checking out their facebook page, their twitter or their interesting GBF Interns Blog in the Field.

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