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Interview with Dr. Markus Freiburg, Founder & Managing Director FASE

Rsz Foto Markus Freiburg Sw Groß

September 06, 2017

FASE has been a member of EVPA since 2015 and you have participated at several conferences in the past few years, what was for you the added value of our conference? What are you looking forward to this year in Oslo?

The EVPA Annual Conference is the central event in the venture philanthropy/venture investment sector where all major actors across Europe meet. For us, it’s the most important event because it brings a huge networking opportunity. It brings value to our mission because we want to create a pan European investor network that invests in early-stage social enterprises, as we notice that most venture philanthropists are still active in their own region.

In addition, it’s a good occasion to exchange knowledge, share our experience in hybrid finance for social enterprises, and also learn from others.

Looking at your experience, what would you advise newcomers?

This is my 4th EVPA conference, and I have the feeling that it is different from the other ones in a sense that it brings more diverse formats with more slots for various types of expertise. This balance between practitioners with different levels of experience is an interesting variation in the conference model.

Having this in mind, I would advise newcomers to take a closer look at the programme and select the topics they are really interested in. Also, aim to interact with other participants as it is the best way to exchange experiences with other EVPA members.

Moreover, look in advance at other EVPA members that participate in the conference, think of the most interesting three to five people and organisations, and approach them upfront to meet them one on one in Oslo. This will be a great learning opportunity!

You are involved in a session on hybrid financing. How should investors approach different types of funding in order to have the impact they want?

We need creative solutions to help social enterprises to scale up their impact. Therefore, it is important to understand and use different available financial instruments. Many times a combination of grant money and investment money can support the further growth of a social enterprise in different stages of development.

A good example of how such a hybrid financing approach can help a social enterprise to grow is Discovering Hands. They train visually impaired women to use their hands to detect early indicators of breast cancer. First, they received philanthropic money to develop and test their model. Second, impact investors such as BonVenture and KfW (German Development Bank) offered a first round of impact investments to scale up the model in Germany and to test their franchise model in Austria. Third, a second round of impact investment was than raised from different investors (e.g., foundations, business angels) in order to scale up their impact in their home markets and to foster their further internationalisation with the market entry in Colombia and Indonesia. They will also need philanthropic money to start operations in these new international markets, alongside more patient capital to scale it up afterwards.

What are the main objectives of the session you are preparing for the conference? Who should join the session?

We still have a financial ecosystem for social enterprises where two dominant mentalities prevail: either we give money away for -100% (i.e. grants) or we invest for market-rate returns. However, social enterprises challenge this traditional separation because they combine for-profit and non-profit elements. Therefore, they often don’t fit into the traditional ‘binary’ funding models and face serious financing challenges (e.g., the so-called ‘death valley’). As a result, there is a lot of impact that could be leveraged by venture philantrophists and impact investors with financing models that can fill the space between -100% and market-rate returns. However, not many investors are already used to this new paradigm of hybrid finance.

FASE has already supported more than 30 social enterprises successfully in raising more than 14 million euros of hybrid growth capital. We are willing to share our learnings and experience with the other participants of the conference. We want to get more philanthropists and investors excited about hybrid finance and activate them to join the field. There is much more potential and we should inspire other investors to become part of this community. We see EVPA as a flagship organisation on hybrid financing. It can provide data, inspiring examples, and co-create added value with its members in order to build the field.

Find out more details about the Annual Conference here.

Annual Conference 2017

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