Private Equity for Non-Profits

Read a few recent articles about private equity for non-profit organizations. Both of them dealt with how social enterprises or non-profits can not reach their full potential quickly enough because of lack of access to financing.

One article in Forbes was about a social enterprise fund that was started recently called Good Capital. It's a venture capital fund targeted at social enterprises (both for profit and non-profit) that have sustainable business models. Apparently it's difficult for these enterprises to get debt financing as they don't have many assets to back up the investment. That's the gap this fund is intended to fill. The fund is supposed to provide a moderate return, but has very high fees. The article also mentions similar funds like Google's Google.org.

The other article in the Wall Street Journal was about how hedge funds are getting involved in supporting fund-raising for non-profits. As hedge fund managers join the boards of non-profits, they're pushing them to focus more of their efforts on fund-raising through charity events and (for those with assets) debt financing.

Comments

gnp said…

Also check out the Omidyar Network. A friend of mine from business school works there.

April 15, 2007 at 3:28 PM

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