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Under Fire, Microfinance Faces Falling Out of Favor

Harvard Business Review

Microfinance has come under fire in the past 18 months, triggered in part by SKS Microfinance's IPO. Critics complain that the institutions supporting microfinance have become too greedy, and many are using this as an argument to deeply regulate or, even more, cut support to microfinance operations. I hope not.

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Funders Can Give More than Money

Harvard Business Review

Six years ago, David and Donna Allman approached Opportunity with an idea that fell outside our traditional microfinance model: to build a Community Economic Development (CED) program in Nicaragua. Together, we've constructed school libraries, repaired churches, built roads, and, crucially, ensured clean water through new aqueduct systems.

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It Takes a Village to Raise an Entrepreneur

Harvard Business Review

These hybrids pursue a social mission while engaging in commercial activities that generate revenues that help them sustain their operations. Frogtek and many other hybrids sell goods and services, and rely on revenues to sustain and scale their operations. Take, for example, the issue of economic development.

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How to Create Youth Jobs After Conflicts

Harvard Business Review

Upon graduation, the governments, nonprofits, or (more recently) microfinance companies give them loans to buy tools and opens shops. We developed a very cheap rechargeable lighting system and a model where a youth can operate a charging station using solar, grid, or human energy.

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It's Not All About Growth for Social Enterprises

Harvard Business Review

One way to tell the story of mothers2mothers' growth is as follows: since 2001, the organization has expanded its operations to nine countries with an approximately $20 million operating budget. Successful examples of this approach are still rare; most people point to microfinance.

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Give Impact Investing Time and Space to Develop

Harvard Business Review

As the sector grows through this period of creative destruction, models that don’t work will die out, models that survive will attract copycats, operating costs will go down, and winners will rise to the top. We allowed microfinance and the venture capital industry the time and space to develop over a few decades.