Acumen makes investments that generate both social and financial returns

Investment Model

As a non-profit, we raise charitable donations that allow us to make patient long-term debt or equity investments in early-stage companies providing reliable and affordable access to agricultural inputs and markets, quality education, clean energy, healthcare services, formal housing, and safe drinking water to low-income customers.

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Patient Capital

The markets alone cannot solve the problems of poverty; nor are charity and aid enough to tackle the challenges faced by over two-thirds of the world’s population living in poverty. Patient capital is a third way that seeks to bridge the gap between the efficiency and scale of market-based approaches and the social impact of pure philanthropy.

For Acumen, patient capital is understood as a debt or equity investment in an early-stage enterprise providing low-income consumers with access to healthcare, water, housing, alternative energy, or agricultural inputs. Our typical commitments of patient capital for an enterprise range from $250,000 to $3,000,000 in equity or debt with payback or exit in roughly seven to ten years.

The patient capital Acumen provides is accompanied by a wide range of management support services nurturing the company to scale. Our aim in investing patient capital is not to seek high returns, but rather to jump-start the creation of enterprises that improve the ability of the poor to live with dignity.

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Investment Criteria

We invest in game-changing companies that are transforming the way the world tackles poverty. To us, that means identifying enterprises that meet the following criteria:

  • Geography: Be located in or have significant operations or impact in East Africa, West Africa, India, Pakistan, or Latin America (launching soon).
  • Sectors: Operate in one of our investment sectors of Agriculture, Education, Energy, Health, Housing, or Water.
  • Stage: Be an early-mid stage company that is in the process of scaling. We rarely invest in pure start-up companies. Check out the FAQ section on the “Apply for Investment” page to learn more about the stages we invest.
  • Investment Size: Be seeking investment capital in the range of $0.25M-$3M, structured as either debt or equity.
  • Strong Management Team: Have a strong and experienced management team with the skills, will, and vision to execute the business plan, an unwavering commitment to serve the poor, and unyielding ethics.
  • Potential for Significant Social Impact: Make a product or deliver a service that addresses a critical need for the poor in our sectors and geographic focus.  These products or services must be economically better or create greater social impact than what is available currently through the market, aid, or charitable distribution.
  • Potential for Financial Sustainability: Have a clear business model that demonstrates the potential for financial sustainability within a five to seven year period; including the ability to cover operating expenses with operating revenues.
  • Potential to Achieve Scale: Be able to demonstrate a clear path to scale for the number of end users over the period of our investment, and be positioned as one of the leading service providers in the market.

Investment Process

As a global organization with offices in multiple jurisdictions, Acumen’s Portfolio team operates as a partnership that shares knowledge, insights, and experiences across its team members.

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Potential investments are identified through business plan submissions, referrals, or proactive research by our Portfolio team members. All investments go through an Initial Due Diligence process in which the potential investment opportunity is vetted and discussed by senior members of Acumen’s Portfolio Leadership Team (PLT).  For those investments that pass the initial deliberation stage, the team conducts a rigorous Formal Due Diligence process which entails a review of the promoter/enterprise in the general areas of (1) social impact, (2) financial viability, (3) operations, (4) management, (5) accounting and (6) legal.  Investment opportunities are then presented to the Investment Committee, which is responsible for leading a final discussion on the critical issues of the potential transaction and ultimately responsible for approval or rejection of investment opportunities.

Investment Principles

Our investment decisions are strongly guided by our investment principles. These include keeping the following at the forefront of our decision making:

  • Voices of the Customer: We stand with the poor by keeping our customers at the core of the work we do. This means listening to the voices of low-income customers that are, too often, unheard.
  • Balanced Investment Approach: We have a high tolerance for risk with our investments but work to understand and mitigate these risks where possible.
  • Enduring Relationships: We forge long-term relationships with investees, and bring appropriate support and resources to them and their companies before, during, and after our investment approval process.
  • Quantitative and Qualitative Insights: While we believe in measuring social and financial performance, we also believe that not all impact can be measured. We seek to capture and share stories and lessons we are learning from our work and share these in sector-wide discussions with our larger community.
  • International Legal Best Practices: Acumen has a zero tolerance policy for businesses that do not abide by the letter of local and international laws. We believe that Acumen plays a role in bringing international legal best practices to the areas we work in.