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ImpactAssets 50: A Global Landscape of Impact Investment Fund Managers
The ImpactAssets 50 (IA 50) is the first open-source, publicly published database of experienced private debt and equity impact investment fund managers.
https://www.impactassets.org/impactassets-50

ImpactAssets 50

An Annual Showcase of Impact Investment Fund Managers

GAWA Capital Partners SA

Total Assets Under Management: $50 – 99M
Asset Class: Private Debt - Absolute Return / Notes
Primary UN Sustainable Development Goal: 1 – No Poverty
Sustainable Agriculture
Small/Medium Business Development
Microfinance/Insurance & Financial Services

Firm Overview

Category: Private Debt - Microfinance

GAWA Capital is an impact investment advisory firm that aims to build opportunities for low-income communities via investments in social companies. Founded in 2009, GAWA pioneered the introduction of impact investing in Spain and has since built a strong track record, with over EUR 75million investments advised worldwide in microfinance, MSME-lending, educational and green-vehicle financing. The first closing of our “Huruma” Fund is scheduled for 30-Nov-2019, focused on (i) promoting financial inclusion for smallholder farmers in rural LatAm and Africa, and (ii) expanding the reach of key SMEs in the agri-value chain that positively impact these types of communities. At GAWA, social impact is essential - we strive to actively improve the social performance of our Funds’ investees, using SPTF framework, IRIS standards and, with Huruma, via Technical Assistance facilities. We aim at being a strategic, long-term investor that helps maximize the social impact of investees on excluded populations.

Firm Headquarters: Western Europe
Years of Operation: 10 years or more
Total Assets Under Management:
$50 – 99M
Total Number of Investors: More than 25
% of Capital from Top 3 Investors: 25% – 49%
Investment Thesis:

We believe that real transformative change arises from market-based solutions to critical issues such as poverty. GAWA aims to help low-income communities in developing countries boost their livelihoods, carefully selecting companies with strong social missions and sustainable business models, thus balancing social impact with a market-rate of return for investors.

Investment Overview:

GAWA believes that 2types of impact investing exist:(i) generic impact investments,and (ii) investments in social companies that provide tailor-made solutions to the market failures that result in issues such as poverty. GAWA focuses on (ii), whereby our funds have a well-defined and coherent theory of change. Supported by Technical Assistance, we aim to solve crucial social issues and maximize the impact of investees. To date, we have focused on financial inclusion (MFIs, MSME/Agri-lending, vehicular & educational financing), but we continue to expand our areas of impact into vital excluded sectors. In this sense, we are developing a fund centered on MSME-lending in LatAm, whilst aiding the transition of these MSMEs towards greener energies. GAWA realizes debt&equity investments in developing markets around the world, whilst social impact management is key from due diligence to divestment. Our performance fee is directly linked to the social performance of investees, proving our commitment to impact.

Company Differentiator:

Social performance management is integrated throughout our investment process, and a key differentiator. This implies an exhaustive initial Social Performance Audit (using CERISE-SPI4 and ALINUS audit tools), social covenants in transaction documentation, and active investee social performance improvement. Technical Assistance is available to improve investee outreach, product and technological adaptation, amongst others. GAWA’s performance fee is linked to its social impact, which is audited by a third-party upon investment exit, ensuring Management’s alignment with the Funds’ social missions. GAWA’s unique impact management practice was recognized last year by the Spanish UN Global Compact, who presented GAWA a prize for having made the largest contribution to achieving SDG#1 (No poverty). Spain’s DFI, COFIDES, also gave GAWA Capital an award for its contribution to development during its 8-years of existence. GAWA’s “Huruma” Fund-the first EuSEF (European social entrepreneurship fund) based in Luxembourg-will be key in continuing to maximize GAWA’s social impact.

Investment Example

Insotec is a transparent and innovative microfinance institution providing financial services to rural and agricultural segments of low-income communities in Ecuador since 1981. 70% of its clients live in rural areas and form part of the poorest level of the population pyramid (as per national statistics). 60% of Insotec’s loan portfolio is focused on agriculture, aiming to provide products that suit its clients’ real needs and cashflows–it has recently launched a unique agri-insurance program to protect its clients from natural disasters and crop loss. Insotec has also created alliances within the agri-value chain, to boost its clients’ exposure. Insotec offers its 17,000 clients and their families additional services such as education, technical assistance, microinsurance and health services via liaisons with third-parties. The MFI is lead by an extraordinary team, with strong social commitment, robust operations and sustainable growth plans. The investment is a USD 2.2MM senior loan,3 year tenor.

Leadership and Team

Cumulative Leadership Experience in Investing:
30 years or more
Cumulative Impact Experience of Top Three Firm Leaders:
20 – 29 years
Agustín Vitorica – Co-Founder and Co-CEO More Info

Agustín has been dedicated to impact investing since founding GAWA in 2009. Previously, he held the position of Managing Director at Dalbergia, one of Spain's largest family offices, where he worked for almost 10 years focusing on Venture Capital & Private Equity investments. Agustín holds an MBA from the Kellogg School of Management and has played a key role in supporting the development of the Impact Investing sector in Spain. He enjoys spending quality time with his family whenever possible in the North of Spain.

Luca Torre – Co-Founder and Co-CEO More Info

Luca has spent most of his career investing in and advising microfinance and financial institutions. Prior to founding GAWA, he worked at Credit Suisse Investment Banking in New York advising many microfinance institutions in accessing capital markets, including Banco Compartamos' IPO. Luca gained on-the-field operating experience working for Annapurna, an Indian MFI. Luca began his career at BCG and holds an MBA from Kellogg where he was awarded Siebel scholarship for leadership. He is an addicted cyclist and loves travelling with his wife and two kids.

Percentage of Investment Professionals who are Women and/or Under-Represented Groups in Firm's Geographic Focus:
50% or more
Percentage of Management Team who are Women and/or Under-Represented Groups in Firm's Geographic Focus:
Less than 25%

Financial Performance

Target Financial Returns Relative to Benchmark:
Market Rates
Actual Performance Relative to Target Financial Returns in the Past Three Years:
In line with initial target returns
Financial Reporting Frequency to Investors or Donors
Quarterly

Impact Performance

Percentage of Total Assets Under
Management that are Impact Investments:
100%
Primary Impact Outcomes:
Alleviating poverty
Creating jobs
Increasing access to financial services
Secondary Impact Outcomes:
Addressing climate change and environmental issues
Increasing access to education and improving educational outcomes
Value-added Services Offered:
Access to markets
Business and legal training
Financial literacy training

Investments systematically target companies where social and/or environmental impact is integral to the product/service being created:

Our funds offer assistance via industry best practices, know-how and social/environmental performance improvement. Our Huruma fund also has a Technical Assistance facility available for investees, enabling GAWA to truly maximize the impact of its investments. Huruma Fund’s objective is to provide the right set of incentives for Financial Service Providers or for Agri-SMEs to transform their business models to better serve/include smallholder farmers: more specifically it seeks to provide the capital needed to build new Agri-finance business units, as well as the knowledge on how to better serve/ include smallholders. Capital is offered through investments and knowledge through technical assistance. Investments are made in Financial Service Providers which are either already serving the agricultural sector and need additional capital to expand their operations or who wish to begin to serve this market – in which case Technical Assistance will be key. In addition, investees’ commitment to use the money to build an Agriculture-related portfolio and/or improve  Social Performance Management practices is documented in all investment documents in form of social covenants. Business objectives, such as number of farmers to be reached during the life of the investment or the launching of new products targeting farmers, are set before making the investment. Regarding Agri-SMEs, target investments are companies including cooperatives, food processors, input providers, or other SMEs that operate in value chains involving smallholder farmers and aim to further develop these business cycles, improving farmers’ quality of life.

Investments systematically include social and environmental sustainability practices in the due diligence process:

GAWA Capital’s advised funds only target companies that have a tangible, direct social impact. Prior to investment, exhaustive financial and social due diligences of investees are carried out. The latter is supported by the completion of the comprehensive CERISE SPI4 questionnaire, following which a specific Social Performance Report is drafted. Both GAWA Capital’s founding CEOs are CERISE certified social auditors, and the social impact score of the institution is based on the resulting 25 social performance metrics. Social covenants are included in each transaction’s documentation and the social performance of each investee is carefully monitored (in line with IRIS metrics) and actively improved during the lifetime of GAWA’s investment. Our funds’ investees commit to improving living standards, healthcare, and access to education and finance for clients. Institutions with a social responsibility to employees and the environment are selected, whilst MFI investees are required to meet SMART Campaign’s Client Protection Principles.

Impact Tracking and Monitoring

Impact is Tracked:
Yes
Social and/or Environmental Impact is Reported to Investors and Donors:
Yes – to investors and donors
Third Party Validations:
Participant on steering committees or leadership roles within impact industry associations
Publisher or contributor to industry white paper or other research in impact investing

Learn More

Key Contact Name: Luca Torre
Phone: +34 64 921 41 04
Mailing Address:

C/ Alcalá 96, 4º Centro, 28009 Madrid, Spain

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