Fund’s Objective

Imperative’s founders developed a revolutionary investment model that can:

– Sustainably lift an entire community out of poverty by addressing and fulfilling most or all of their basic needs for goods and services, elevating the entire community to its next level of social development and environmental sustainability.

– Accomplishing this transformation in two years or less.

– Doing so under a strict financially sustainable framework that, in return, allows for the replication of the model in as many low-income communities as can benefit from it.

Business Model 

Imperative identifies the most successful Social Enterprises (SEs) addressing needs for basic goods and services such as structural housing, Internet connectivity, clean water, renewable energy, low-cost basic family basket, affordable healthcare, and waste management. Each SE must have a proven track record, positive financial results in the previous two-to-five years, and provide goods and services that complement what other SEs provide.

Based on a thorough analysis to understand the needs of each community, and tailored to address most -if not all- existing deficiencies, Imperative bundles together the ideal group of SEs. The implementation of each good or service follows a specific strategy aimed to achieve a smooth transition for the community to its next level of social and economic development and environmental sustainability, in two years or less of implementation, and five years or less of financing.

Imperative provides the operational capital for the SEs. They in turn finance access to their goods and services for the entire community. The capital is provided to the SEs in the form of convertible debt, where Imperative reserves the right to convert the debt to equity in these companies (SEs).

Sectors

Depending on the selected communities and their specific needs for goods and services, we identify the sectors for investment that fulfill most -or all- of the communities’ requirements, including -but not limited to- housing, internet and telecommunications, clean water, renewable energy, healthcare, food cost reduction, and waste management.

Invest With Us

1. We leverage the innovations of the open market economy to sustainable (i.e. in the long run) assist in mobilizing entire communities out of poverty.

2. Our investments have a maximum term of six (6) years (72 months) from the fund’s initial closing (subject to a 1-year extension). The implementation time-frame of all services in a community can vary between 18 and 24 months, and total repayment of the invested funds for Investors is structured under a maximum 60-month repayment schedule, with quarterly repayments starting on month 19.

Portfolio Construction:
a. Investment Technique: 100% Primary Funds
b. Strategy: Impact Investing/Convertible Debt
c. Geography: Emerging/Frontier Markets
d. Targeted Impact: Poverty Elimination/Social Mobility/Environmental Sustainability

3. Annual Management Fee* (Asset Management Charge): 2%

4. Return for Investors and Carried Interest: 5% preferred return for Investors, compounded annually, after Management Fee; above preferred, 80% to Imperative (catch-up) until accruing 2% carried interest and 20% to Investors; all additional returns at 80% to Investors and 20% to Imperative.

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*Investment objectives and targets may not be realized and cannot be guaranteed. The description above is a summary of certain terms and is not intended to be complete.

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