Collaborative for Frontier Finance and first CFF report on Enterprise Segmentation officially launched at SOCAP 2018
The Collaborative for Frontier Finance (CFF) was officially launched on 10 October 2018 as a multi-stakeholder initiative comprised of investors, funders, and field-builders that aim to increase the amount of appropriate capital available for small and growing businesses (SGBs) in frontier and emerging markets. DGGF is one of the founding members of this initiative, alongside infoDev/World Bank and Omidyar Network.
Building on a year-long period of market-informed design, CFF was incubated at the Global Development Incubator with close support from DGGF and other founding partners, and saw its formal launch at the SOCAP 2018 conference in San Francisco. CFF is supported and led by a steering committee that also includes Argidius Foundation, DFAT, MacArthur Foundation, and Small Foundation.
CFF is working with a variety of stakeholders to identify emerging solutions and pioneering organizations that are deploying solutions reaching SGBs. With this progress to date, CFF aims to build on progress to accelerate and pilot new solutions. Through “clusters” – or communities of stakeholders focused on specific themes related to SGB finance – CFF is co-designing initiatives that can catalyze new capital for SGBs. DGGF leads and serves as an anchor of the Mezzanine Finance cluster of CFF, based on its accumulated experience and expertise on mezzanine finance instruments, as well as is actively contributing to the strategic priorities of CFF and knowledge building on frontier finance.
As one of the first attempts to address the large finance gap for small and growing business, CFF undertook an effort to segment them into multiple “missing middles” in order to help more effectively diagnose the distinct financing needs and gaps faced by different types of enterprises, and in turn better focus on scaling the financing solutions that are most needed to empower enterprises of all types to meaningfully contribute to inclusive economic growth. The report “The Missing Middles: Segmenting Enterprises to Better Understand Their Financial Needs” by CFF, DGGF, Omidyar Network and Dalberg Advisors was also launched earlier this month at SME Finance Forum webinar for its members, and then more broadly at ANDE Annual Conference 2018 and SOCAP18. The study aimed to develop a segmentation framework with the aim of helping investors, intermediaries, and entrepreneurs better navigate the complex landscape of SGB investment in frontier and emerging markets, and has divided the universe of SGBs with financing needs between $20,000 and $2 million into four distinct “families.”. To learn more about these distinct segments, their characteristics and implications for various stakeholders, please see the full report, as well as the summary report on CFF website, as well as on DGGF depositary.
Learn more, and sign up for the news and updates about the Collaborative for Frontier Finance at http://www.frontierfinance.org and follow @CollabFFinance.
Read the coverage of the report “The Missing Middle: Segmenting Enterprises to Better Understand Their Financial Needs” on Medium and ImpactAlpha.