Investing with impact: Helping people to help themselves
The company was founded by Managing Partner Loïc De Cannière in 2001. “I used to work for a large marine engineering company,” he explains. “I was responsible for structuring financing for large infrastructure projects, particularly in Africa and Asia. It was a great job, and I loved it, but I was extremely shocked by the level of poverty in countries such as Nigeria, Ghana, Tunisia, India and Bangladesh. At 40 years old and with a wealth of experience, I was sure I could do something to help alleviate that poverty.”
Mr. De Cannière’s personal philosophy helped to determine the direction his support would take. “I very much believe in entrepreneurship, and helping people to escape poverty through their own efforts,” he says. “I wanted to support people and push them to develop their own capability and potential, and take responsibility for improving their own quality of life.”
The result was Incofin Investment Management which is, among other things, a microfinancer which aims to encourage investment in projects in developing countries. It also uses agri-finance to provide risk capital to sustainability-focused producer cooperatives and agri-SMEs, which qualify as impact investment.
“We have a wide range of funds with different themes,” says Mr. De Cannière. “We develop these funds and try to find investors for particular projects. These tend to be finance institutions such as banks, pension funds, and insurance companies, but in recent years have also included family offices and high net worth individuals. It’s all private investment; we are not an NGO and therefore don’t receive any state funding.”
The popularity of impact investment – a concept which Mr. De Cannière has helped to pioneer – has grown exponentially over the past five to ten years, with banks and other wealth managers facing specific demands to use investors’ money for social improvement. “People want to do something positive with their money, and the great thing about impact investment is that you combine investment return with social return,” the Managing Partner underlines.
I believe in helping people to get out of poverty through their own efforts. Loïc De CannièreManaging Partner and Founder
Impact investment is a 500 billion USD market worldwide, and Incofin has contributed significantly to the growth of the microfinancing industry which reaches out to 45 million end clients. In total, the firm has managed investments of between two and three billion USD across 65 different countries, enabled 260,000 smallholder farmers to improve their standard of living. “One of our responsibilities is to make sure that both the microentrepreneurs and the farmers – that is, both investors and end recipients – benefit from the investment,” Mr. De Cannière points out.
Incofin has managed a diverse range of investments. Microfinancing institution AMK in Cambodia was established after the civil war to contribute to the reconstruction of the country. It has enabled many small farmers to escape poverty by building up their smallholding businesses, and has also developed a crop insurance product for the same target market, as well as creating a facility to allow single women to draw a pension. Incofin has played a major role in sourcing investment for AMK’s activities. Columbia is another region in focus, where fair-trade certified smallholder cooperatives have encouraged farmers to switch from coca to legal crops.
“We were very impressed by the courage of these cooperatives; they operate in areas where coca-related murders and kidnappings are prevalent,” notes Mr. De Cannière. “We supported them with investments, and also gave them access to educational training to help convince the farmers.” One of Incofin’s most recent equity investments is Juhudi Kilimo, a microfinance institution in Kenya that offers credit to small-scale farmers and microentrepreneurs in East Africa. This includes loans for livestock, agricultural machinery, crops, green energy and investment to increase productivity.
Mr. De Cannière is proud of Incofin’s core values. “Entrepreneurial spirit and taking creative initiative is part of our DNA,” he says. “We aim to be generous, not only to each other, but also with our investors and the companies we invest in. We are deliberately very transparent and are happy to share all our data. One thing which is particularly important to us is that we understand the conditions on the ground – how people in developing countries live.”
Incofin’s next major project is a fund for India, which will invest in the agri-foods sector. “We are currently proposing this to investors and also working with a large Belgian retailer, which is quite unique,” Mr. De Cannière continues. “We believe that, through smart investment, we can develop a market from the bottom up, creating a value chain from the smallholder farmers to the market; this will ensure that the farmers’ products reach the market in a good condition and thereby increase their revenues. In essence, this is what really drives me: improving people’s lives and working conditions.”