Wednesday
December 17
2014

Caroline Ashley

Three BoP Business Portfolios: Progress across three portfolios supporting 160 companies

I recently had a fascinating week comparing data and results across three inclusive business portfolios: the Business Innovation Facility (BIF) pilot (2010-2013), Innovations Against Poverty (IAP) pilot (2011-2013) and Business Call to Action (BCtA – five years old and ongoing). The data is based on years of rich engagement with three contrasting portfolios, each with an exciting – but different – array of innovative businesses.

IAP grantees were mainly start-ups trying to secure the right business model and start generating revenue; BIF-supported businesses were piloting and operationalising their models, seeking to boost cash-flow and approach profit; BCtA members are more established, with half already cash-flow positive.

In composite, this gives us a set of around 160 companies, which has no claim to be representative of the world of inclusive business, but has great value in adding to the meagre evidence base on what inclusive business is actually delivering. So from this diverse array of three portfolios, our latest Spotlight draws on data to explore:

  • What annual revenues are typically being reached?

  • What level of reach to people at the Base of the Pyramid are the businesses achieving?

  • What trends and contracts emerge?

The Spotlight on Inclusive Business, “Is Inclusive Business showing results?” goes into the details of how and why, but the bottom line is that in all three portfolios we can see actual growth. However, that actual growth is almost invariably well below the projected annual growth rate or social impact targets that are committed at the start. There are a few cases of companies exceeding their targets, but they are the minority.

(Left: A graph from the report showing revenues among companies included in the portfolios).

On the positive side, if we already knew the journey was long, the data also provides some early evidence that companies are breaking through. Not many in the BIF and IAP portfolios were earning millions of dollars or reaching millions of people, but we made estimates that a decent share would do so within a few years. Performance of this wider sample seems to validate that.

Please explore the full report to find out more.

Caroline Ashley is the editor of the Practitioner Hub on Inclusive Business and an independent consultant at Ashley Insight Ltd.

Categories
Entrepreneurship
Tags
Base of the Pyramid, impact investing