Presentation on theme: "IFC Global Private (PE) Equity Funds Role of PE in Development A PE Fund for Haiti June 2012."— Presentation transcript:
IFC Global Private (PE) Equity Funds Role of PE in Development A PE Fund for Haiti June 2012
2 IFC is the largest global development institution focused on the private sector in emerging markets (“EM”). We create opportunity for people to escape poverty and improve their lives, through investing. We invest, advise, mobilize capital, and manage assets providing innovative solutions for a more inclusive and sustainable world. We were founded in 1956 as the World Bank’s (WB) private sector arm. IFC has 184 member countries. Who is IFC? What Do We Do?
IFC and EM PE Funds IFC has invested $3 billion in about 200 PE funds, and focuses on frontier countries. PE provides equity capital and expertise and can significantly impact company growth and job creation. PE is an effective way to support small companies in small countries. IFC backs local first-time fund managers in EM. IFC requires environmental, social and governance standards for all investments. Since 2007 over half the PE funds supported by IFC have been in the world’ s poorest countries. SMEs account for about 2/3 of our investments. IFC invests no more than 20% in the Funds and helps mobilize other investors. We estimate that our PE funds’ investments have created about 300,000 new jobs over the last 10 years. 3
Why Did We Invest in Haiti? Why Haiti? IFC and WB are very active. WB wanted to involve private sector and create jobs, moving away from relief aid after the earthquake. Widespread unemployment and lack of opportunities. Demonstration effect of IFC investment in poorest countries catalyzes other investors. What are the opportunities we see? Family-owned businesses that were thriving before earthquake needed equity and advisory services to rebuild and expand. Successful entrepreneurs from the Diaspora are coming back. Great opportunity! PE is an ideal way of channeling funds and expertise to Haiti’s small businesses as well as boosting standards and improving corporate governance. 4
How Did We Invest? In March 2012: IFC subscribed up to $10M in Leopard Haiti Fund. Leopard Haiti has a local team in Port au Prince, and experience in frontier investing. Fly-in fly-out investment does not work. Being a local fund manager is critical. Access, reputation checking, due diligence, management, acquiring talent are all highly local. What is the strategy of the Fund? Investing sectors: low- and medium-income housing, construction, agribusiness, IT, Telecoms, and hospitality. These sectors showed potential before the earthquake. Enhancing corporate governance and environmental and social standards of its portfolio companies… and peers! IFC helped mobilize $15M from other investors. At second close, we expect to mobilize $50M in equity from the diaspora and private capital for SMEs. Raising an additional $4M for an Advisory Services facility to provide support to SMEs pre- & post-investment. 5
Thank You ! Sergio Pombo Investment Officer Global PE and Investment Funds International Finance Corporation (IFC) The World Bank Group email: firstname.lastname@example.org 6