Dear Houghton,
We are proud to send you our first “Call for Impact”. Read about co-investment opportunities, learn about pressing global issues in our market insights, and stay up-to-date about upcoming events and latest developments at LGT Venture Philanthropy. Overview:
> Our portfolio is growing
> Co-investment opportunities
> Market insights from our due diligence
> iCats Fellowship Program 2012 - Apply or recommend now
> News & Outlook
Our portfolio is growing“Educate Girls” in India
 Educate Girls (EG) joined our portfolio in Jan 2011. EG works towards improving girls’ enrolment, retention and academic performance in government schools by leveraging existing community and government resources that are available as part of the ‘Education for All’ program of the Indian central Government. In a two-year intervention, EG realizes its mission with an average cost per girl of USD 2.50 currently reaching ~160’000 girls with the potential to reach ~1m girls until 2014.LGT Venture Philanthropy’s engagement: A performance-dependent grant of USD 500’000 over the next 3 years. Furthermore EG is part of the LGT Employee Donation Program and the iCats Program to support EG in fundraising.
Co-investment opportunities
We are currently pursuing a number of investment opportunities. For the following 5 social enterprises, we offer co-investment opportunities alongside LGT Venture Philanthropy, if final stages of our internal due diligence are positive. Contact wolfgang.hafenmayer@lgtvp.com or +41 44 256 8117.
Opportunity 1: Primary health care provision, Africa
Theme/region: Africa/Health
Business model: For-profit
Co-investment opportunity: Equity investment, USD 250’000Problem: Millions across Sub-Saharan Africa die from preventable diseases that are relatively simple to treat with inexpensive drugs and appropriate medical care. Underfunded and over-burdened public healthcare systems mean that basic primary healthcare remains inaccessible to the vast majority. Conversely up to 70% of the health care expenditure in the region is financed out of pocket despite 51% of the population living below the poverty line. Cost and quality remain key barriers to healthcare.Solution/business model: The organization delivers quality health care services to lower end populations in Kenya, focusing on affordable treatment and drugs, accessible clinic locations and a sustainable business operation. The organization is built around a hub and spoke model and leverages technology and a community outreach program to reduce costs, increase patient footfall and ensure sustained positive impact.Opportunity 2: Retail for BoP, Asia
Theme/region: Access to affordable products for BoP (Base of Pyramid)/Asia
Business model: Hybrid (For-profit and non-profit entities)
Co-investment opportunity: Equity investment, USD 250’000
Problem: In poor, rural and far-flung areas, goods and services readily available in urban settings are expensive and difficult to come by. Prices can be up to 25% higher for exactly the same products as in the cities. In many of these areas, small informal shops exist. Acting independently of each other, they do not benefit from volume discounts from suppliers nor avail of marketing and support programs from manufacturers. Their average daily turnover is around USD 10, with gross profits of USD 1.5-2/day.Solution/business model: The organization brings together these small rural village stores in a micro enterprise development program which increases the sustainability of the stores and provides access to affordable goods and essential services for the communities they are operational in. Through a massive aggregation initiative, an inclusive supply chain and an innovative training framework, the program is able to manage the flow of products and services through the platform, ensuring impact for its store owners as well as for the community.Opportunity 3: Renewable energy, India
Theme/region: Renewable energy/India
Business model: For-profit
Co-investment opportunity: Equity investment, USD 500’000Problem: 480 million citizens in India (45% of the total population) do not have access to reliable power. Particularly rural electrification is in an acute crisis as a total of 125’000 Indian villages are presently without access to electricity. There are no official plans how to connect those villages to the grid. Current power options such as kerosene lanterns or diesel generators are uneconomical, inefficient and environmentally unfriendly.Solution/business model: The orgaization has developed a proprietary technology to convert locally produced agricultural waste directly into electricity. The organization is targeting its “mini-power-plant“ technology to villages in northern India which have never had access to electricity.Opportunity 4: Improved education and new role models, Latin America
Theme/region: Education/Latin America
Business model: Non-profit
Co-investment opportunity: Grant, USD 200’000Problem: In Chile, approx. 1.8 m low income pupils aged 6 to 18 years perform poorly in public schools due to a lack of qualified teachers. This reduces their opportunities for higher education, lowers their competitiveness in the labor market, and perpetuates the poverty cycle.Solution/business model: The organization rigidly selects outstanding university graduates from various academic backgrounds, such as engineers, biologists etc. who are then intensively trained as teachers and sent to low-quality schools for a period of two years. The impacted pupils have made remarkable gains in Spanish and Mathematics test scores, as well as in non-cognitive abilities, such as self-esteem.
Opportunity 5: Creating transparency in the Chinese philanthropy sector
Theme/region: Markets for social investments/China
Business model: For-profit
Co-investment opportunity: Loan, USD 400’000Problem: China witnesses a growing donation enthusiasm in the social space. However, social capital allocation is inefficient, mainly due to issues like lack of capital allocation transparency and monitoring, limited donation channels and operational efficiency. It is difficult for resources to reach grassroots civil society organizations (CSOs), which lack the knowledge, visibility and access to networks. At the same time the transparency issues regarding the usage and impact of the funding raise concerns in social investors, preventing them from finding the right CSO partners.Solution/business model: The organization aims to shape the philanthropy industry in China into a robust and transparent one. A web-based platform with reliable information of ~1’600 foundations and derived database analytics effectively connects social investors to the CSOs. Social investors can identify projects they are interested in, donate online and track the use and impact. The organization also provides philanthropy advisory services to donors and consulting services to its CSO partners.
Market insights from our due diligence
LGT Venture Philanthropy’s local teams have been working intensively on due diligence learning a lot about local markets. Start reading about our insights below. If you are interested in delving deeper, contact nathalie.moral@lgtvp.com or +41 44 256 8120.Situation of girls’ education in India
 Girls’ literacy in rural India at 44%
India has the largest illiterate population of any nation on earth: 304m in total, or 34% of adults are illiterate. Also the younger generation is affected: 1 out of 4 girls aged between 15 and 24 years cannot read and write. The situation is particularly miserable for girls and women in rural areas, e.g. in Rajasthan, where female literacy rate is 44% compared to male literacy of 76%. Despite significant international and government funding to improve education (approx. USD 13bn since 2007 alone), the situation is still dismal. Poverty is one cause, but more importantly cultural and social barriers as well as the bad quality of education keep many parents from sending their children – especially girls – to school.RUTFs to fight malnutrition
 High need for Ready-to-Use Therapeutic Foods (RUTFs) in Haiti
Currently, less than 15% of the children in need of RUTFs in Haiti receive treatment. With an estimated ~350’000 children malnourished, the total addressable market for RUFs in Haiti is worth USD 15m -19m per year. Procurements of RUTFs has been increasing significantly in recent years due to international attention to nutrition in Haiti and the observable trend in demand by main players is extended long-term commitments to nutrition programs.
Effective use of resources in India
 Jatropha, renewable energy and organic fertilizer: How can they benefit from each other
India has 141m hectares of arable land with agricultural / horticultural output close to 800m tons, which generates nearly 700m tons of biomass waste per annum. Roughly 400m tons of this waste is used as fodder while the remaining is available for biomass power generation.
Biomass feed-stock after digestion becomes an excellent base for natural fertilizer which is highly suited for regeneration of degraded lands. India has been one of the largest consumers of the most commonly used chemical fertilizers. However, with increasing recognition of the ill effects of long-term chemical fertilizer use, there is interest in the market for natural or organic agro inputs.
Further, Jatropha is highly suited for wastelands as it can grow in poor quality soils, on rocky terrain, and can survive on minimal rain and fertilizer inputs. Used as biomass, its oil seed cake produces a higher amount of energy than most agricultural waste.
iCats Fellowship Program 2012 - Apply or recommend nowWe are excited to announce that we are now welcoming applications for the iCats Program Fellowship 2012. Application deadline is the 31st of July 2011. If you want to belong to the next group of impact catalysts, apply now. You can also help to promote the Program by recommending us to your friends and colleagues and  us on Facebook.
News & Outlook
House of Philanthropy Solutions
 The first House of Philanthropy Solutions in Zurich was inaugurated on May 26 with an exclusive event attended by active and future philanthropists.
Two network events co-hosted by Ashoka, AlphaMundi, SUSI Partners and KL Felicitas Foundation brought together players from the Impact investment space in the House of Philanthropy Solutions on May 27. The House of Philanthropy Solutions (HOPS) is an interactive exhibition space aiming to inspire people to become active philanthropists. It showcases great social and environmental challenges and effective solutions in an innovative way, offering the visitor a tangible experience.
Contact: If you want to visit the HOPS, learn more about it or hold an event there, please contact natija.dolic@lgtvp.com or +41 44 256 8122. New website
LGT Venture Philanthropy launched its new website: www.lgtvp.com. Browse through our virtual House of Philanthropy Solutions and our service offering and send your feedback to pia.lassak@lgtvp.com.
New team member in West Africa
Marindame Kombate joined the LGT Venture Philanthropy team. Based in Ghana, Marindame Kombate will drive the West African efforts of LGT Venture Philanthropy together with his two African colleagues and his 16 colleagues around the world. SoCap Europe
LGT Venture Philanthropy hosted two panel discussions at SoCap Europe, bringing five social entrepreneurs from our portfolio and their respective globes from HOPS along. The globes were exhibited during the duration of the conference from May 30 - June 1. EVPA Annual Conference in Turin, ItalyEVPA’s 7th annual conference will take place on Nov 16-17, 2011 in Turin on the topic: Venture philanthropy as a catalyst for societal change. Wolfgang Hafenmayer will host a roundtable on non-financial tools: “Why money is not enough to invest successfully”.About LGT Venture Philanthropy
LGT Venture Philanthropy is an impact investor supporting organizations with outstanding social and environmental impact. Our team in five continents strives to increase the sustainable quality of life of less advantaged people by inspiring clients for active philanthropy, providing individualized philanthropic advice and investment implementation. Our broad range of clients benefits from the experience, systems, processes and networks built by implementing the philanthropic engagement of the Princely Family of Liechtenstein/LGT Group. LGT Venture Philanthropy, Färberstrasse 6, CH-8008 Zurich, Phone +41 44 256 8110, info@lgtvp.com, www.lgtvp.com |
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