SMALL FUND SUBSIDIES

Nairobi Kenya
June 2018
WHAT DO WE MEAN BY SMALL FUNDS?

DOCUMENT NAME / OR WRITERS NAME | 2017 2

COLLABORATIVE FOR FRONTIER FINANCE

Investor / fund manager Funder Networks & fieldbuilders

DOCUMENT NAME / OR WRITERS NAME | 2017 3

COLLABORATION CRITERIA

1. ADDITIONALITY OF COLLABORATION

2. IMPACT & ADVOCACY POTENTIAL

3. URGENCY & SUPPORT

DOCUMENT NAME / OR WRITERS NAME | 2017 4

SOLUTIONS

o Mezzanine finance / alternative

investment instruments and vehicles
o Capital advisory models
o Very early stage funds / seed stage funds
o Impact monetization
o Angel investment networks
o Capital mobilization

DOCUMENT NAME / OR WRITERS NAME | 2017 5

 FUND ARCHETYPES

VC MEZZ
CAPITAL PORTFOLIO
OBJECTIVES CONSTRUCTION

MEZZ INVESTMENT
MANAGEMENT
EXIT
OBJECTIVES
DEBT
VC DEBT
DOCUMENT NAME / OR WRITERS NAME | 2017 6
SHARPENING USE OF SUBSIDIES
ARCHETYPE OR FUND LIFECYCLE SPECIFIC?

• First loss guarantee

• Cross subsidization
• Subordinate loan
• Partnerships
• Low return expectation
• Sectoral focus
• Currency hedge

• Pre and post TA

• Fund manager support EXIT
• Product development OBJECTIVES
• Below market rate
remuneration

DOCUMENT NAME / OR WRITERS NAME | 2017 7

MARKET DEVELOPMENT
SHIFTING FROM OPERATIONAL AND TRANSACTIONAL TO SYSTEMIC

DOCUMENT NAME / OR WRITERS NAME | 2017 8

A NEW ASSET CLASS?

DOCUMENT NAME / OR WRITERS NAME | 2017 9