Event Briefs - AlphaMundi speaks at EVPA in Spain and SuperReturns Africa in Ghana
In Accra, AlphaMundi contributed to 2 panels on "Making the case for debt in Sub-Saharan Africa" alongside Investec, Helios with a moderator from Rock Creek, and on "Recalibrating Impact" alongside the African Development Bank with a moderator from Morgan Stanley's PE Fund Group. The first panel covered issues such as debt security and guarantees, conflicts of interest when an investor holds both debt and equity, the risks of debt-financing for early-stage companies, and the need to verify local regulatory requirements before transaction completion. The second panel highlighted the need for impact measurement standardisation, the dissociation between impact and financial returns, the difficult balance of interests between impact and returns, and the advantage of impact investing over grants with regards to capital preservation.
In Madrid, AlphaMundi contributed to 1 panel on "What can Europe learn from Latin America", alongside the IDB, Fondation Demeter and BBVA, with NESST moderating the conversation. Despite structural poverty, with 10% of the LAC population owning 50% of GDP and the other 10% owning 2%, a high rate of homicides, a young population with 50% under 18 years old with 70% of those aged 13-18yo out of school, Latin America is nonetheless a region full of promise. It harbours 40 local impact funds, 70 grant-making foundations, 53 incubators and 135 B-Corps. Impact funds alone have USD 2B currently invested in the region.
Another session in Madrid dedicated to Social Impact Bonds proved particularly interesting, noting the market now encompasses some 52 Social Investment Bonds with a total volume of USD 140M. Market hurdles include the availability of data and government transparency, the need for public administrations to increase their debt as they set money aside to pay for the SIB, the lack of preventive policies and instruments, the need for a culture shift in execution agent/NGO accountability, the political cycle that can interrupt a SIB process which can require up to 18 months to establish the baseline and define the terms. SIB risk may also be hard for measure for investors.