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Understanding the Opportunity for Impact Investing in Africa June 5, 2013

Understanding the Opportunity for Impact Investing in Africa June 5, 2013. Our Panelists. Cynthia Muller Arabella Advisors. Niamani Mutima Africa Grantmakers ’ Affinity Group. Scott Wallace Wallace Global Fund. Daryn Dodson Wallace Global Fund.

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Understanding the Opportunity for Impact Investing in Africa June 5, 2013

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  1. Understanding the Opportunity for Impact Investing in AfricaJune 5, 2013

  2. Our Panelists Cynthia Muller Arabella Advisors NiamaniMutima Africa Grantmakers’ Affinity Group Scott Wallace Wallace Global Fund Daryn Dodson Wallace Global Fund

  3. Impact investing uses return-seeking investments to help accomplish social and environmental goals.

  4. Industry Timeline Franklin establishes 1st fund Socially Responsible Investing Movement Development of market infrastructure 1980-2000 2007 1968 1790 2010+ PRIs included in Tax Code Global Financial Crisis

  5. Projected market size of Impact Investing Impact Investing in 2013 ~$9 billion Philanthropy (U.S. only) ~$300 billion Impact Investing 5-10 year projection ~$650 billion Total Investing ~$60 trillion

  6. Mapping the Impact Investing Industry The Sterling Group UK GERMANY CHINA (HONG KONG) NETHERLANDS USA INDIA MEXICO KENYA SINGAPORE BRAZIL SOUTH AFRICA AUSTRALIA

  7. Cynthia Muller Director, Impact Investing Arabella Advisors

  8. Where Does the Capital Come From?

  9. Impact Investment Continuum Below Market-Rate Investments (Impact First) Market-Rate Investments (Finance First) Lower Risk Higher Risk Higher Risk Lower Risk Source: F.B. Heron Foundation Mission-Related Investing Continuum

  10. Foundation Impact Investing

  11. Impact Investing in Africa • Size of African impact investing market between $300-400 million per year • Sub-Saharan Africa represents a large area of growth with the continent • Kenya and South Africa represent large areas of interest and growth • Challenges around transparency and general uncertainty about business and political environment

  12. Examples of Impact Investing in Practice GHANA KENYA SOUTH AFRICA

  13. Scott Wallace Co-chair Wallace Global Fund

  14. Background on Wallace Global Fund and Impact Investing • WGF progressive family philanthropy • Henry A. Wallace • Programs in environment, democracy, women’s human rights, media and corporate power • Funds globally and domestically • Work in Africa • History of supporting women’s human rights in Africa, reproductive rights and abandonment of FGM/C • Support for civil society in Southern Africa • Example: Zimbabwe Alliance, donor collaborative

  15. Mission Related Investing • Commitment to breaking down the wall between 95-5% • 2009-2011 – Process begins to align program and assets • New investment committee, advisors and managers, with substantial savings in overall management cost to Fund • 2012 first year of performance – 11.8% beating benchmarks • Screening goal is 100% positive + negative screens, currently over 90% • Example of Environment Program alignment – fossil fuels and climate solutions/clean tech • 99% fossil fuel free • 5% + in clean tech

  16. Portfolio Screening System

  17. Impact Investing • 5% of fund minimum for impact investments, will increase • Early interest: Shared Interest • Board set criteria for impact investment • Benefit marginalized communities, potential for scale • Women • Sustainability and climate solutions • Engaged consultant to research impact opportunities

  18. Daryn Dodson Consultant Wallace Global Fund

  19. Q&A Cynthia Muller Arabella Advisors NiamaniMutima Africa Grantmakers’ Affinity Group Scott Wallace Wallace Global Fund Daryn Dodson Wallace Global Fund

  20. Sampling of AGAG Membership with an Impact Investing Strategy

  21. Opportunity for AGAG Funders • Help to build networks and awareness • Seek opportunities where Grants and or PRIs can help to reduced transactional risk and costs • Cultivate strong entrepreneurs • Don’t forget about public policy • Share your results and experiences

  22. Impact Investing Resources • The Global Impact Investing Network (The GIIN) • Mission Investors Exchange • Council on Philanthropy • Publications • Impact Investing in West Africa (Dalhberg) • Case Study: Mtanga Farms • Special Report: This is Africa

  23. Stay in Touch • Web • www.ArabellaAdvisors.com • www.AfricaGrantmakers.org • www.WGF.org • Twitter • @ArabellaAdvisor & @CynMull • @AGAGAfrica • Email • Info@ArabellaAdvisors.com

  24. NiamaniMutima Executive Director Africa Grantmakers’ Affinity Group

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