12/30/2011 �������������� ������������� ������ � About GBF � Evaluating Impact � Pre-Investment Criteria � Post Investment � Data - What indicators are tracked? � Tools - How are they reported? � Analysis -How does GBF review the data? ����������� GBF’s mission is to build and support High Impact Businesses that provide sustainable economic opportunities to millions of people at the base of the economic pyramid. ���������� GBF strives to create a world where economic opportunity reaches everyone. 1
12/30/2011 ���������� GBF provides a blend of investment capital and capacity building to support High Impact Businesses to scale and bring sustainable economic and social opportunities to the base of the economic pyramid. ������������� GBF has invested about $2.5 million in 9 High Impact Businesses in Asia, which make up almost one-quarter of GBF’s portfolio and have impacted the lives of almost 3.8 million people in the innovations in finance, artisanal, BoP services, and agricultural sectors. ���������������������������������������������������������������������������������������������������������������������� ���������������������������������������������������� �������������������������� �� ��!!����� $12 to 20 million $45 to $60 million Donors Investors Grants Debt & Equity Capital GBF GBP GBI-I Shared Resources Capacity Building Debt, Equity & Quasi- Equity capital Blended Investment Approach High Impact Businesses Micro Other BoP Farmers Artisans Entrepreneurs Beneficiaries �� �"�!����#����$���� Total funds deployed: $2.4 million* Capacity Building Focus Areas: 1) Financial Management 2) Operations and Supply Chain Management 3) Legal and Regulatory 4) Strategy 5) Human Capacity and Governance 6) Environmental and Social Note: The cost of staff led business assistance is not included 2
12/30/2011 �� �����%�$���&��!���� ��������������������� ��������������������� ������������������� ������������������� ���������������������� ���������������������� Southeast Innovations Asia in Finance 7% 16% Africa Agribusiness South Asia 40% 34% 24% Artisanal 23% LAC BoP Services 29% 27% !���"�#����������������������������������������������������������������������������������������� $��������%������������������& ����'�!��� $8.5 million Invested in: � 10,500 Farmers � 15,000 Entrepreneurs � 32,000 Artisans � 1,583,700 People served through cost saving activities � 7,111,500 Family Members Supported ���('����������'�!���������$���� GBF invests in businesses that generate direct and significant incremental income/savings to their suppliers or customers. GBF works with companies that directly impact in the range of 500-2000 individuals, with potential to increase and scale at least 5-10 times over the period of the investment. GBF invests in companies that either are – or motivated to be - environmentally and socially responsible. GBF uses a Social Return on Investment (SROI) to estimate the number of people its investees will reach and the social- economic impact these businesses will create. 3
12/30/2011 Calculating SROI • Identify the BoP beneficiaries and the type of impact created by the business model* Step 1 • Link the quantifiable impacts to the financial model using SROI template Step 2 Step 3 • Project the number of beneficiaries in future years* • Estimate the total economic returns, including terminal value in perpetuity at a 5% discount rate Step 4 Step 5 • Estimate the total amount of external financing, including future rounds Step 6 • Calculate the SROI ratio of the social enterprise **Assumptions are used in calculations when data does not exist "����&���#�)� Servals is focused on providing clean, efficient, and affordable burners and stoves to consumers at the bottom of the pyramid. GBF is providing Servals with a loan to expand its geographic presence in the kerosene burner market, set up According to Servals, the Venus burners are now widely used all over India due to its design and a distribution channel, and user benefits. In fact, Servals is the single largest producer of kerosene burners in India with a market launch their new Top-Lit Updraft share of about 7%. biomass stove. �����$�* Beneficiary Impact 2011 2012 2013 2014 2015 Wage Benefit to Rural Workers Incremental Income to Rural Workers $ 18,019 $ 21,962 $ 26,968 $ 33,309 $ 41,342 Commissions to Micro-entrepreneurs Payment to REEs $ 4,304 $ 7,372 $ 11,154 $ 15,711 $ 21,111 - Royalty on product $ (1,442) $ (2,470) $ (3,738) $ (5,265) $ (7,074) Net Economic Returns $ 2,862 $ 4,901 $ 7,416 $ 10,446 $ 14,036 Net Fuel Cost Savings to Consumers Total Burner Fuel savings $ 1,274,400 $ 1,553,291 $ 1,907,313 $ 2,355,805 $ 2,923,953 - cost of burner $ (855,733) $ (1,083,498) $ (1,368,617) $ (1,739,288) $ (2,221,271) Net Economic Returns $ 418,668 $ 469,793 $ 538,696 $ 616,517 $ 702,682 Combined Economic Returns $ 439,548 $ 496,657 $ 573,080 $ 660,272 $ 758,060 Number of beneficiaries 2011 2012 2013 2014 2015 Rural manufacturing employees 90 122 165 222 298 Micro Entrepreneurs 330 520 750 1,020 1,330 Consumers 456,443 623,249 849,248 1,150,208 1,551,600 Total 456,864 623,891 850,163 1,151,450 1,553,228 External Financing 2011 2012 2013 2014 2015 LT Debt $ 114,986 $ 153,025 $ 51,769 $ - $ - ST Debt $ 43,846 $ 25,787 $ 38,111 $ 55,114 $ 78,368 Revolver $ - $ - $ - $ - $ 25,857 Equity $ 159,211 GBF investment $ 98,913 $ 89,216 $ 81,250 Assumptions Total Capital $ 416,955 $ 268,028 $ 171,130 $ 55,113.87 $ 104,224.32 1. Income per rural manufacturer (Rs. /yr) 9,162 2. Discount Rate 6% Exchange Rate (USD/INR) $ 46.00 $ 51.00 $ 56.00 $ 61.00 $ 66.00 3. Average fuel saving/ burner (over life) 65 4
12/30/2011 &+,�-*�"����&���#�)� SKEPL is based in India and provides technological solutions for better milk collection to village level cooperatives. Through its products, SKEPL generates economic impact for farmers by increasing the share of dairy production revenue that they receive, reduces the risk of lost AKASHGANGA is currently implemented at more that 700 locations and with millions of farmers income from wasted milk, and dependent on dairying as a supplementary livelihood. increases transparency into the entire process for farmers. &+,�-�&.�' Dairy farmers who are members of dairy collection societies that use SKEPL’s managed services product SKEPL expects to serve 645,000 dairy farmers in India by 2015. $19,314,010 $667,819 28.92 �����$�* Beneficiary Impact 2011 2012 2013 2014 2015 Farmers Savings from samples $ 200,750 $ 521,950 $ 1,003,750 $ 1,686,300 $ 2,589,675 Increase in annual bonus $ 16,432 $ 42,435 $ 81,834 $ 136,015 $ 209,761 Combined Economic Returns $ 217,182 $ 564,385 $ 1,085,584 $ 1,822,315 $ 2,799,436 - Payment made by co-ops for service $ (210,504) $ (517,740) $ (950,892) $ (1,326,008) $ (1,712,232) Net Economic Returns $ 6,677 $ 46,645 $ 134,693 $ 496,306 $ 1,087,204 Number of beneficiaries 2011 2012 2013 2014 2015 Number of Co-ops (cumulative) 500 1300 2500 4200 6450 New 500 800 1200 1700 2250 Existing 0 500 1300 2500 4200 Farmers 50,000 130,000 250,000 420,000 645,000 Total 50,000 130,000 250,000 420,000 645,000 External Financing 2011 2012 2013 2014 2015 LT Debt ST Debt $ 125,245.56 Equity $ 154,608.18 GBF investment $ 221,658.77 $ 209,682.36 Total Capital $ 501,512.51 $ 209,682.36 $ - $ - $ - Projections 2011 2012 2013 2014 2015 Average cooperative profit $ 1,117.81 $ 1,110.29 $ 1,113.39 $ 1,101.51 $ 1,106.16 Assumptions 1. Discount rate 5% Number of AMCS Managed Services 2. Sample milk saved per day per farmer (ml) ( SKEPL data) 20 sold (cumulatiave) 500 800 2500 4200 6450 3. Average price for milk/liter $0.55 Monthly managed services fee $ 32.89 $ 31.11 $ 29.72 $ 28.00 $ 26.78 4. Net increase in bonus after AMCS (Ford data) 3% 5. Average number of members per co-op (industry research) 100 Exchange Rate (USD/INR) $ 45.60 $ 48.21 $ 50.48 $ 53.57 $ 56.02 6. Average cooperative profit pre AMCS (Ford data) INR 48,550 5
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