With the help of the Overseas Private Investment Corporation’s (OPIC) recent $5 million commitment to support the UCF (Unreasonable Capital Fund), the young venture capital firm will be able to invest in and support what it calls the “greatest entrepreneurs of our time.” These entrepreneurs address the foundations of poverty in emerging countries by creating profitable businesses.
Unreasonable Capital will use the OPIC funds for early-stage investments in businesses in developing countries that will ultimately enable large segments of their populations to rise into the middle class. The focus of the UCF will be on start-up companies in these sectors: energy access, financial technology and mobile phone applications in agriculture and artisan-driven fashion.
The intent of the UCF investments is to develop self-sustaining, profitable businesses that improve the lives of people in Latin America, India, Asia and Africa. Unreasonable Capital works exclusively in emerging markets. It focuses on clean energy, financial technologies, innovations in agriculture and artisan-driven fashion because it believes these business sectors can best make inroads into long-term poverty in those markets.
The firm measures the success of its investments on both financial returns and social impact. It wants to work with entrepreneurs in emerging markets who are intent on solving significant social or environmental problems in a way that their social impact is “baked into their profit model.”
Unreasonable Capital offers start-ups not only financial assistance but also access to best practices and mentors through the firm’s global network of more than 200 partners and 250 mentors. The partners include The World Bank, Google and Nike. Mentors include the founder of WordPress and the chief marketing officer of Unilever.
Unreasonable Capital received its $5 million commitment from OPIC through the institutions’ Innovative Financial Intermediaries Program (IFIP). The program is intended to help small financial vehicles invest with the aim of developing businesses that are innovative and have a social impact.
OPIC, established in 1971, is the development finance institution of the US Government. It marshals private capital to address critical development challenges, especially in emerging markets. By doing that, OPIC advances US foreign policy and national security interests.
OPIC is self-sustaining. Its projects produce no net cost to U.S. taxpayers. In fact, it normally generates income and helps reduce the federal deficit. It does so through supporting projects such as power plants in Sub-Saharan Africa, low-income housing in Latin America and food processing plants in Eastern Europe. OPIC’s $5 million commitment to support the UCF is just one more example of the institution fulfilling its mission.
– Robert Cornet