The Grassroots Business Fund (GBF) is a financial business idea originally set up as the International Financial Corporation’s Grassroots business Initiative (GBI). It handles funds and capital for grassroots businesses with high growth potential and concrete business plans; which are in need of support from corporate bodies in order to help them expand their range of business and bring good starter business ideas an opportunity to thrive where possible.
As Grassroots Business Initiative, their operations were circled basically around investing in grassroots businesses and their investments, and field-testing of capacity-building approaches for the businesses and investments they are involved with. In other words, there has been extensive research work done on investments to be raised from base to finish and also enhancements of already existing business ventures. Also, the GBF as part of the International Financial Corporation builds capacity of businesses through systematic and well proven approach with high success rate.
The Grassroots Business Funds make strategic investments like straight debt investments, equity, mezzanine equity and mezzanine debt (not secured by assets but the ability for the debt to be repaid due to free cash flow), given to companies with good growth potential and viable expansion plans.
As a fund, GBF has a sustainable capital scheme capable of holding for investments with a long-term span especially to businesses which have their patronage to be communities with low income rate. The funds create a platform for those grassroots investments to thrive in such areas of community, which in turn ensures the thriving and growth of such businesses. It not only provides financial aid but counselling and support through the period of business growth
The mission of GBF is to grow viable, sustainable and inclusive businesses that generate earnings or cost savings for people in Africa, Asia and Latin America, it works toward a world where economic opportunity reaches everyone. It also has a vision for poverty alleviation in low income communities by boosting businesses concentration and expansion for firms with growth potentials that seem promising
- The investment focus of Grassroots Business Funds is to businesses that have commercial growth potential with highest probability to succeed. That refers to mostly companies in their “growth stage”.
- GBF seeks companies with defensive competitive advantage as displayed through high barrier of entry, first-mover advantage, high-quality differentiated products and so on.
- Companies with competent and strong management teams with track records are considered by GBF.
- Financially, GBF prefers between $750,000 to $2,500,000 investments with investment structures including equity, quasi-equity, loans and guarantees. They therefore don’t seek control of your company but expect to exit investments within 5-7-year time frame.
- Your company must be for-profit with strong commitment to bringing measurable and sustainable social as well as economical impact to low communities. Such that is economically important, from which local communities can benefit directly or indirectly from.
- Companies and businesses should have an affecting capacity of 500 to 2,000 individuals in range while maintaining a development and increasing capacity to scale up to 5 to 10 times within the period GBF would be investing to them.
- Presently, the geographical focus of GBF includes Africa (Kenya, Tanzania, Mozambique, Rwanda); Asia (India, Indonesia); Latin America (Bolivia, Peru, Colombia, Ecuador, Paraquay).
If your company falls under the category described above, contact the regional office that covers your location. Simply click here