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Mobilizing Diaspora Direct InvestmentA new source of capital
Individual Impact Investing in the 21st Century
London – United Kingdom
What are the facts?
• What we know about Diaspora capital flows:– US$450B in remittance flows from West to
Emerging Markets (10%-15% per year) - WB– US$40B in flows into Africa alone (P2P)
– Conventional Wisdom: Subsistence Consumption
What do Remittances say?
• Remittances outstrip any other form of flows– Size – Resilience
• Do Remittance flows = Diaspora Investment Flows?
• What do we know about remitters and their motivations…
GWU – Western Union Research
• GWU-Western Union Afro Migrant Study:– About 1,000 members of US-based African
Diaspora were surveyed – sponsored by WU– Research Objectives:
• Profile?• Investment interest and activity?• Obstacles to investments?• Diaspora investment advantages?• Investment motivation?
GWU-WU Findings (1)
• Profile?– Average stay in the US: 22.18 years– 72.2% plan to return “Back Home”– Average age of respondent: 46 years old– More than 50% have annual incomes in excess of
US$100,000– Average remittance in past 3 yrs: US$12,974 (std
dev: US$22,873.)
GWU-WU Findings (2)
• Demographics:
GWU-WU Findings (3)
• Risk Tolerance
GWU-WU Findings (4)
• Contact with “Back Home”
GWU-WU Findings (5)
• Investment Interest (%)
GWU-WU Findings (6)
• Investment Activities (%)
GWU-WU Findings (7)
• Diaspora investment motivation summarized:• Financial• Emotional• Social-status• Political
Implications?
• How to translate into a palatable proposition?• Need to:
– Facilitate Access to Impactful Opportunities– Provide Reasonable Prospects for Returns– Provide Process Transparency– Address Voice Mechanism
• Must do this in a single proposition…
Solution…
Homestrings Update
• Over $10 million invested via Homestrings.com since 2/2012
• Over 1000 members in database• Infrastructure bonds - key drivers
– Kenya, Nigeria, Ghana, Mozambique…• Public financing debt:
– Cote d’Ivoire (2032), Congo, Uganda, Egypt,…• Financing Pipeline: Healthcare, Housing, Agribusiness
and Mining…
Next Steps?
• Diaspora and Other interested Investors• Registering at the average rate of 100 a month
• Growing book of Opportunities• Private Equity Funds• Diaspora Bonds (gvts, corporations, n/profits)• Housing (investment, lending, buying)• Deals (co-investment and stand-alone)
Conclusion
• Homestrings – a repository of investment opportunities for Diaspora and other investors
• Homestrings – a platform for vetted project promoters
• Homestrings – first impact investment “shopping mall” for the Diaspora.
Contacts
• Eric V. Guichard – Founder/CEO [email protected]
• Derek Smail – Senior Advisor/Member of Advisory Board [email protected]
• Address: www.homestrings.com
