Scaling Mission Driven Enterprises

 

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The Challenge


2.

Our Solution


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Impact to Date


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Kiva Labs: Social Enterprises

 

 
 

Kiva Labs: Social Enterprises invests in mission driven enterprises to help them scale their impact. Kiva Labs: Social Enterprises provides working capital for social enterprises to enhance productivity, remove bottlenecks to growth, and accelerate expansion, so that the enterprises are attractive to larger, institutional follow-on funding. Kiva Labs: Social Enterprises was previously known as Kiva's Direct-to-Social Enterprise program.

 
 

The Challenge: Smaller enterprises face the "Missing Middle"

 

 
 

Small-to-Medium Enterprises (SMEs) fall into a category often referred to as the “Missing Middle” – they are too big for micro-finance loans, yet too small for traditional bank loans. Financial institutions often reject them as too small and risky to underwrite, or offer unaffordable interest rates.

As a result, early stage enterprises are underfunded, especially in developing nations. This limits their ability to scale and impedes homegrown economic development and employment. Social enterprises with a mission-driven business model suffer the same exclusion.

 
 

300 million

Micro-and-small enterprises are
excluded from the financial system

 

4 out of 5

Jobs in Emerging Markets Created by SMEs

 
 
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The Solution – Kiva Labs: Social Enterprises

 

 
 

Kiva Labs: Social Enterprises Loans Are:

  1. Risk tolerant and impact-first

  2. Range from $10,000-$50,000 for first time borrowers

  3. Range from $50,000-$100,000 for second time borrowers

  4. Loan terms of 12-18 months

  5. Provided to more than 30 social enterprises each year

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Kiva Labs: Social Enterprises – Impact to Date

 

 
 

One of the primary objectives of the program is to enable social enterprises to escape the missing middle and scale up to a point at which they are no longer too small for more traditional sources of financing. Historically, only 40% of Kiva Labs: Social Enterprises borrowers could access unsecured loans, and for those that were eligible, interest rates quoted could be as high as 30%.

 
 

$5.7 Million

Lent to Social Enterprises

110 loans with an average
loan size of $50,000


6,795

Jobs Created

As a result of Kiva Labs loans in developing countries


311,186

Jobs Supported

Through Kiva Labs
loans on Kiva.org


$2.4 Million

Invested in Women

48 social enterprises that are women-led or primarily serve women



$26 Million

Follow-On Funding

Received by borrowers after receiving their Kiva Labs: Social Enterprises loan



5 : 1

Ratio of Follow-on Funding

For each dollar lent by Kiva, SMEs receive $5 more in follow-on funding


 
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Kiva Labs: Social Enterprises has supported enterprises in 33 countries

 
 
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Social Enterprise Stories

 

 
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Pakistan

 
Without the Kiva loan, I wouldn’t have been able to prove my business model. I’m not sure we’d still be standing, and it wasn’t because of our business model, but because I didn’t have access to the working capital. The Kiva loan was critical to prove that our customers are credit worthy, and helped me establish a financially sustainable and scalable model to bring people affordable solar energy, proving that if we finance it, they would pay us back.
— Shazia Khan, CEO

EcoEnergy provides affordable solar technology directly to off-grid communities in Pakistan, where 40% of the population – 70 million individuals – lacks access to an electricity grid.

Its innovative business model provides solar energy solutions on rent or mobile money pay-as-you-go plans with terms up to 24 months.

EcoEnergy was founded by Shazia Khan, a Pakistani-American environmental lawyer who specializes in energy access and was thinking about ways in which the country could generate more power to meet increasing demand while struggling with "load-shedding" -- a term used to describe temporary power cuts that aim to save energy when demand exceeds supply -- and complete lack of electricity in rural areas. Shazia realized that Pakistan needed a clean energy alternative, but it had to be affordable.

This led Shazia to team up with Jeremy Higgs, EcoEnergy's cofounder to conduct market research across 44,000 households in Pakistan. Eventually, they decided to focus exclusively on solar home systems, but needed the finances to purchase them since EcoEnergy’s financing options would mean that customers would not pay them back in full until at least about 18 months after their purchase, while suppliers were unwilling to wait for that long. To purchase these solar home systems, Shazia and Jeremy needed to find an affordable source of capital which led her to Kiva Labs: Social Enterprises.

 
 
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Kenya

 
The Kiva Labs loan was the first loan we had taken; it was particularly critical at that time because we were transitioning to a leasing model that required much greater working capital. We were able to broaden our network through Kiva’s amazing network, and Kiva’s loan created credibility for us to get additional loans – to be able to say we have taken on a loan and successfully paid on time. Having that track record was really helpful.
— Lindsay Stradley, Co-Founder

Sanergy is a social enterprise that builds low cost, high quality sanitation facilities branded as ‘Fresh Life’ that are franchised out into the community members who run them as viable businesses

In Kenya, 8 million residents living in urban slums lack access to safe and affordable sanitation. Slum residents rely on unsanitary options such as “flying toilets” and pit latrines that release untreated human waste into the environment. In sum, 4 million tons of untreated fecal sludge from Kenya’s slums are discharged into waterways and fields every year posing serious risk to public health and the environment.

Sanergy collects the waste on a regular basis and converts it into by-products such as organic fertilizer. To date, Sanergy has built a network of 580 entrepreneurs running over 1,200 Fresh Life Toilets serving over 50,000 people daily. They have safely collected and removed over 13,000 metric tons of waste from the community.

 
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Join Us

 

 

Lend to Social Enterprises


Your loans on Kiva.org provide uniquely risk-tolerant capital to scale social enterprises around the world. 

Partner With Us


Mission-aligned Investors, Corporations, and Foundations, please partner with Kiva to scale more social enterprises and maximize impact.

Assess Social Enterprises


Help us evaluate social enterprises on Crowdvet.org, where crowd wisdom creates efficiency to move more capital.

 

Thank you to our supporters

 
 
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