Intellecap’s ecosystem, fintech and eye-care, Israeli social impact bonds, Brief Quiz №23



Greetings, ImpactAlpha readers!

#Featured: ImpactAlpha Original

Building businesses for the next three billion middle-class consumers. Markets aren’t built overnight. Neither are companies with the potential to change the world. Vineet Rai has spent the last 15 years building both markets and companies in India, through the business advisory firm Intellecap and the venture investment firm Aavishkaar.

The two companies merged in January and the new Aavishkaar-Intellecap Group is expanding from India to Southeast Asia and sub-Saharan Africa, bringing a platform of investment and advisory products for high-impact entrepreneurs to some of the world’s fastest-growing markets.

“Making impact investment work isn’t just about the provision of capital,” said Lindsay Clinton, the US director of Intellecap, as she accepted the GSG Honor for Market Builder of the Year at this week’s GSG Impact Summit in Chicago. “It’s also about bringing to bear superior talent, unearthing deep insights, and building strong networks.”

Read, “Building businesses for the next three billion middle-class consumers,” by Dennis Price:

Intellecap: Building businesses for the next three billion middle-class consumers

#Brief Quiz No. №23

The mostly Darren Walker edition. The president of the Ford Foundation said what? Apple is investing $1 billion in what? And the sector that accounts for three-quarters of the world’s water use is which?

Aren’t you so smart? Test your impact IQ with The Brief Quiz №23 by Jérôme Tagger:

Brief Quiz №23: The mostly Darren Walker edition

#Dealflow: Follow the Money

IGNIA invests in peer-to-peer lender Afluenta. The Mexican fintech revolution rolls on. The Mexico-based venture capital fund made an undisclosed investment in Afluenta, an online platform based in Argentina, to spur its expansion in Mexico. Afluenta facilitates lending between individuals and businesses to fill a gap in lending for the emerging middle class in Argentina and other parts of Latin America. Investors can invest as little as $335, while borrowers vetted by Afluenta can apply for loans up to $4,700. Afluenta’s 650,000 users have transacted more than $25 million. Afluenta raised $8 million last year from the International Finance Corp. and impact investor Elevar Equity. Fintech startups could capture 30% of Mexico’s banking market within 10 years.

The Global Health Investment Fund backs eye care device startup Iantech. Half of global blindness is caused by untreated cataracts. The GHIF, along with the Visionary Venture Fund invested in the surgical eyecare venture to lower the cost and increase the effectiveness of cataract surgery. The GHIF is a joint fund between the Bill & Melinda Gates Foundation and JPMorgan Chase. Iantech has developed a cataract surgery device called miLOOP to make surgery “more efficient, less invasive, less dependent on capital-intense [devices], and easier to learn.” The device has already been commercialized in the U.S.; the investment is focusing on the miLOOP’s global potential. “Because extremely advanced cataracts are so prevalent among poor populations, we have a promising new technology that will be welcomed by surgeons both in the most advanced Western centers as well as in the developing world,” says David Chang, an Iantech advisory board member.

See all of ImpactAlpha’s recent #dealflow.

#Signals: Ahead of the Curve

Social impact bonds aim to fill government-spending gaps in Israel. As the Israeli economy has grown, income inequality and social gaps have expanded beyond the capacity of government and philanthropy alone. The country’s overall unemployment was a low of 4.8% last year, but high jobless rates in both the ultra-Orthodox and Arab-Israeli communities means that more than half live below the poverty line, including more than 800,000 children. Social Finance Israel has launched two social impact bonds to help bridge the gaps. The first, targeted on preventing type II diabetes, is the rare social impact bond that targets a mainstream, rather than vulnerable, population. The second, which seeks to reduce dropout rates from higher education, has already started to repay investors. Other social impact bonds, focusing on prisoner rehabilitation, reducing mortality from colon cancer, reducing car accidents, and improving K-12 achievements for Bedouins, are also in the works. Social Finance Israel’s Yaron Neudorfer met with investors, philanthropists, and field-builders in New York this week.

#2030: Long-Termism

The rest of the world has trouble providing universal health coverage, too. As the U.S. Senate considers ways to revamp the health care system, so is the “High Level Political Forum” at the U.N. One of the Sustainable Development Goals up for review at this year’s forum is SDG №3: Good health and well-being for all. Among the targets: “Achieve universal health coverage, including financial risk protection, access to quality essential health-care services and access to safe, effective, quality and affordable essential medicines and vaccines for all.”

At least 400 million people worldwide still lack access to basic health services. Experts have identified 11 ideas to achieve affordable universal healthcare. It starts with accepting that “there’s no such thing as a ‘perfect healthcare model’,” according to Priya Balasubramaniam of the Public Health Foundation of India. “India is more focused on achieving Universal Health Care through mixed health markets featuring both public and private sector players,” she says. Other countries like Thailand have built momentum through commitment to primary health coverage. In general, health spending needs to be more focused on sickness prevention rather than treatment.

Another tip: Let rich people and poor people get care from the same providers. “This ensures that high quality will be a political priority as those with voting influence are directly affected by the quality of services provided,” writes Jolene Skordis of University College London’s Centre for Global Health Economics. Countries shouldn’t fixate on the percentage of gross domestic product goes to healthcare. “The question should be about what can you do best with what you can afford to spend,” suggests Balasubramaniam and Siddharth Chatterjee, a U.N. coordinator in Kenya.

Finally, learn from places that are getting it right. Take Ghana’s imperfect but experimental healthcare system. The country started small with community-based health insurance and then developed a national model. “Ghana’s health system isn’t the best I’ve seen,” says Cicely Thomas of Results for Development in Washington, D.C. “But they’ve got some very fundamental things right and have been continually improving over many years.”

That’s a wrap. Have a great weekend! Please send any news and comments to TheBrief@impactalpha.com.

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