“Conduct Comprehensive Due Diligence” The 5 Lessons I Learned Being a 20-Something Founder
I had the pleasure of interviewing Eva Yazhari, co-founder and CEO of Beyond Capital, an impact investment fund that seeks out and invests in seed-stage for-profit social enterprises serving impoverished communities throughout India and East Africa.
Jean: Thank you so much for doing this with us! What is your “backstory” of how you become a founder?
I began my career working in private equity and investment banking in major Wall Street firms, which instilled in me a love of investment and entrepreneurship. The next step in my career trajectory was to marry my financial background with my family legacy of public service. I have been endlessly inspired by the example my grandfather set by establishing and operating a health clinic in rural Tanzania in the 1950s. He moved his wife and children there from the US and added to his family by adopting a child from the community. You could say that giving back runs deep in my veins.
I partnered with my husband as co-founders of Beyond Capital in 2009. From the outset, we sought to build an organization that drew in resources from our financial, corporate and personal networks that would extend and maximize our own individual philanthropic efforts. In doing so, we wanted to challenge the notion that impact investing is only accessible to a select few. We believe that impact investing is a mindset that can guide not only where you put your dollars, but where you direct your passion. This is increasingly how millennials invest — with their hearts as well as their wallets.
Jean: What do you think makes your company stand out? Can you share a story?
According to a publication by the World Resources Institute, four billion people living at the bottom of the economic pyramid in the developing world represent a $5 trillion global consumer market. [JC1] Through our work and presence on the ground in these markets, we understand that low-income populations are underserved consumers who can benefit from increased access to much-needed products and services. Beyond Capital supports the growth of social enterprises in India and East Africa that provide fundamental products and services in water, sanitation, clean energy, and healthcare to address the needs of this significant consumer base.
Beyond Capital also focuses on social enterprises perceived by those outside the market to carry higher risk than these companies actually bear. These entrepreneurs struggle to raise funding from the local ecosystem because there is not sufficient capital available (as such, these social enterprises face the so-called “capital gap”). A recent study (2016) by Bridges Ventures and the African Private Equity and Venture Capital Association indicated that lack of access to seed finance ($10,000 — $100,000) prevent impact-driven social businesses in Africa to develop business models to a stage where they are ready to take on investment and scale their operations. [JC2] Over the nine years since our founding, Beyond Capital has helped fill the seed capital gap for social enterprise startups in these markets and realized a 27% IRR to plow into new investments.
[JC1]“Market Size and Business Strategy at the Base of the Pyramid,” World Resources Institute
[JC2]Bridges Ventures & African Private Equity and Venture Capital Association — reference
We feel that our partnerships are our strongest asset. We carefully vet the enterprises and entrepreneurs who approach us for funding; in fact, we have evaluated more than 450 companies to date. After carefully assessing each opportunity, we are able to establish an ongoing collaboration that helps the company meet its long-term goals and creates long-lasting value. It is always our mission to produce opportunities that make these enterprises more sustainable and successful in the long term.
Beyond Capital is set up as a nonprofit so that we can provide pro bono advisory services to these startups, helping them to establish operational practices and procedures that lend credibility to potential investors. We are often the first professional investment in these enterprises, so these frameworks are essential to the company’s ongoing advancement, which ultimately improves the quality of life for the individuals it is seeking to impact.
Jean: Are you working on any exciting projects now?
We have exciting plans for growth for the remainder of 2018 and into 2019. We have a fundraising goal of $2 million, which we will use to invest in 12 social enterprises split evenly between India and East Africa.
Because we are organized as a nonprofit organization, we seek out donations in addition to large investments from corporations, foundations, family offices, and individuals. Anyone can become an impact investor with a simple donation to Beyond Capital, which we put towards our companies and their missions.
We are introducing our Ambassador Program, in which donors with high annual contributions will have the unique opportunity to engage with Beyond Capital team and our portfolio at a more intimate level. They will benefit from Beyond Capital’s expertise in capital allocation and diligence process management and can forge relationships with co-investors and later-stage funders.
Jean: Do you have a favorite book that made a deep impact on your life? Can you share a story?
I was inspired to launch Beyond Capital after reading The Life You Can Save, a book by the influential moral philosopher Peter Singer. In doing so, I set out to build a model to increase the quality of life and standard of living for individuals living under the poverty line.
Jean: What are your “5 Lessons I Learned as a 20-Something Founder” and why? Please share a story or example for each.
1 - Surround yourself with people whose values, missions, and passions align with your own.
At Beyond Capital, each collaboration we take on needs to meet our number one goal of helping to improve the quality of life for individuals living at the bottom of the economic pyramid.
2 - Never lose sight of the big picture of why you’re doing what you do while completing day-to-day tasks.
As a small, nimble team, we all contribute to achieving our mission.
3 - Look for simple solutions to complex problems.
Making an impact on some of the world’s most pressing social issues can be overwhelming; making small changes that have larger implications can help alleviate anxiety about achieving our goals by producing tangible results. Take, for example, our partnership with Kasha, a company that is providing health and personal care products to women in Rwanda in discreet, culturally sensitive ways.
4 - Conduct comprehensive due diligence.
Establishing a partnership’s goals at the outset of the collaboration keeps everyone on track and allows for regular assessments.
5 - Infuse your outside interests into your work.
My parents were working artists, so I was raised to appreciate art and design. These interests influence and shape all aspects of my life, and therefore, how I approach my work, with an appreciation for beauty and a sense of purpose.
Jean: Some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this. :-)
Michael Bloomberg for his commitment to business and social causes
Jane Fonda because of her humor and realness. She walks the talk! I recently saw her in LA driving her own Prius.
— Published on June 27, 2018