avpn plenary 3: how to set up a vpo
DESCRIPTION
This breakout session will discuss the key considerations in setting up a venture philanthropy organisation (VPO)TRANSCRIPT
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Social Investment Partners
Venture Philanthropy in Japan
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Fragmented SPO Market in Japan
Among 50,000 SPOs, most are struggling in small scale
Few SPOs that maintain sustainability to maximize social
impact
Existing supporting organizations focus on early stage, in small
amount, usually for a single year.
CSR focuses on specific sector or field of assistance. Individual
probono is based on volunteers at
ado-hoc
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Business scale
10M
50M
20M
Small number of large scale businesses
Medium scale businesses with the potential to grow
Large number of small scale non-profit organizations
200-300M
No. of organizations
Distribution of the business scale and quantity of SPOs in Japan
SIP VP Model
Existing Intermediaries
Strong Demand for Long-term
Financial and Managerial Support with Governance
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Who we are?
VP organization founded in 2012, by seven business sector veterans with average more than 20 years of experience in venture capital,
private equity, corporate finance and management
Manage JVPF (Japan Venture Philanthropy Fund) in the amount of 150M yen with Nippon Foundation. Donors are business professionals,
business owners, corporates. Nippon Foundation commit 1:1 matching
Focus on development stage. SPOs with proof of concept to expand social impact
Probono commitment: invested more than 1,000 hours in aggregation
Bain & Co: strategy consulting
Clifford Chance: legal counsel
VOX Global Japan: communication consulting
One international accounting firm joining this year
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Thorough DD to identify and measure social impact utilizing TOC and Logic Model. Main selection criteria is:
Innovative approach and solution to social issues
Measurable social impact and its scalability
Sustainability of operation
Management team
Mold business plan with potential investees to design support plan:
Long term financial support with various instruments and milestones
Long term managerial support with road maps with governance
Portfolios:
NPO After-School (2013): Achieved 3-year business plan by one year ahead. Number of schools and beneficiaries has grown by 3 times.
Started operation at public schools based on their best practice at
private ones. Revenue has grown from 40M yen to 200M yen.
Teach For Japan (2014)
What we do?
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APRIL 21, 2015
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Social Impact Partners aims to change peoples lives for the better through financial, human and intellectual support for Hong Kongs social purpose organizations, using the venture philanthropy approach.
Our Vision
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Geography: Hong Kong
Sectors of Interest: Primarily in education, youth, employability
Size of investment: HKD 1 3 million
Investment period: Periodic disbursement over 3 to 5 years vs. performance indicators
Stage: Early-mid stage organization in process of scaling
Investment Strategy
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Scale up proven programs/ enterprises addressing critical social issues
Prove concept of VP against the liability of newness in Asia
Objectives
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HKD 15 million raised
Vehicles for both grants and social investments established
Strategic partners across key operational functions
Reviewed 40 deals with 3 in due diligence and 1 approved for investment
Progress to Date
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Focusing on providing non-financial support is critical to the Social Impact Partners model and to helping organizations become strong, more robust and sustainable
Can be sourced from investors, paid consultants and pro bono resources
Developing Resources
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Strategic Partners
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Pre-launch market profiling
Sources of deal flow:
Foundations
Social investors
Consultants
Industry groups (HKCSS, HKFx. TWF, etc.)
Need:
To articulate the benefits of an engaged funder relationship
To provide high level of early stage. pre-application support
Generating Deal Flow
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Assessing Impact
Key Question for SPOs:
What outcome i.e. social change, are you striving to achieve?
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Deal flow
Development of network
Capital deployment
Co-investments
Portfolio health
Quarterly KPI Reporting
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APRIL 21, 2015