What's a Sustainable Innovation and Development Bank?
Transform Global is a highly developed vision to create a ‘Sustainable Innovation and Development Bank’. The structure includes important innovations to help people meaningfully tackle pressing economic, social and environmental issues at real scale around the world.
The design of this 'profit with purpose / fintech for good' business is
for a venture that is more flexible, inclusive and less constrained than national or multilateral development banks. At the same time the goal
is to create something that is fit for purpose and more socially and environmentally focussed than conventional investment banks.
The goal is to create a model for what 'fair and progressive capitalism' could and should be - and to create a strong example for the world.
While Transform Global is the brand - we refer to the business as a 'Sustainable Innovation and Development Bank. Another way to see it is as a 'Private Sector Development Bank' or an 'Impact Investment Bank'. All terms help illuminate the intent - but the descriptor with the controversial term 'bank' needs an explanation...
Unlike retail or combined retail and investment banks - we won't take deposits from the public to then issue loans backed by deposits. We also won't do M&A (or raise money or deliver advice to deliver financial returns on their own. The Transform Global model for a 'bank' in our case is as a corporate finance and investment management business, combined with a technology and marketing company.
The aim is to design, raise and deploy innovative impact investment funds and structures globally to enable financial capital and human talent to flow where it can have the greatest impact towards the SDGs.
The focus of these often blended and extended capital structures is on aligning interests and driving collaboration to enable capital to flow, and to unlock innovation - so the SDGs can be best addressed and that all stakeholders can get more of what they want - often for less risk.
The Transform Global mission is about filling funding gaps and building investment capacity for a better world. Read more about how we intend to do this on this site, on the separate www.bigcrowd.net website, or simply get in touch if you have interest in collaboration or investment.
What will Transform Global include?
The crowd sourcing, funding and
fairly incentivised collaboration platform
where the BIGCrowd can help find, fund
and support those important Big Impact
Game-changers with the best ideas and
projects to address SDGs they care about.
SDG 360 Big Impact
An Impact Investment focussed
fund management business working
alongside Transform Global to raise
and then manage the SDG 360 Fund
A £10 billion target, permanent
capital, innovative impact fund.
enabling investors to revolutionise
the impact eco-system, via the
Transform Global platform and its
fintech and impact fund investments.
Not Forgetting the Governance Vehicle!
Transform Global Trust Foundation
The Transform Global Trust Foundation is being set up to deliver and maintain intelligent governance for Transform Global and its subsidiary businesses - and of course the funds which are raised and directly or indirectly managed.
The vision is collaborative, inclusive and fair. It also takes a holistic outlook to achieve balance between commercial viability, responsibility and impact priorities. While enabling healthy returns over time - governance aims to ensure that no stakeholders can dominate with a short term agenda. The focus is on the longer term but urgent objectives of sustainable impact towards the Sustainable Development Goals - which in turn helps address the worlds BIG risk and resilience threats.
Great governance as described needs to be fair for all - though influence within ESG boundaries is commensurate with a long term approach to leadership, performance, value added, capital provided, and contribution. It is critical that important stakeholders many ignore are also included in this equation. Stakeholders including future generations and nature are considered and included in the structure and decision framework. The Foundation is designed to help us create and maintain a culture that is fit for purpose and to safeguard the founding aims of the whole profit with purpose enterprise for the long term. This includes in the event of any change of ownership or public listing of the businesses or funds.
The Foundation will have an executive management team and a rotating 15 strong board of trustees selected from 5 key stakeholder groups. These groups include investors, civil society and a diverse set of NGO’s, respected social business innovators, the Big Impact Game-changers for whom the model is there to support - and Transform Global employees.
A critical requirement is transparency. As the venture develops to size, we intend to have a 150 person observer board (with 30 from each of the five groups above), strict impact measurement and reporting requirements - and a public forum for discussion and debate on key issues.
Background, Why and How?
The reason for Transform Global is simple. We believe the world needs to dramatically increase rates of innovation development and roll out for truly important and positive economic, social and environmental activity. It's not just that more capital that is required to address specific funding gaps - but it is vital that capital flows in ways that can both incentivise and help create the positive culture organisations of the kind needed to best deliver long term impacts.
We also believe that the design of our profit with purpose venture could make a massive difference to do just that.
The UNs 17 Global Goals for Sustainable Development (SDGs), which were ratified in 2015 as a more complete replacement for the Millennium Development Goals (MDGs) are perhaps the best framework to illuminate the issues we all need to face around the world. Rather than simply 'nice to have' goals, the SDGs also spell out what are also termed to be serious 'risk and resilience threats'.
Though people disagree widely on which of the SDGs are most important, few disagree we are moving at a snails pace (or that we are moving quickly in the wrong direction) when it comes to addressing these truly important issues. The consequences of this have a high probability of being dire for many of us.
The potted history to the 12 plus year journey that led to the development of the model for Transform Global as it currently exists is detailed in this blog post. As one might expect, the journey has had many twists and turns. Though now with the strong foundations of maturity, depth of thought, and the ever increased motivation of the founder - in many ways the vision has come full circle. As it was from within the first few months, the vision is still to:-
To source the best people and ideas
To attract and give access to capital
To offer great returns and unique investment opportunities
To raise public awareness on a massive scale
The original purpose articulated in the four bullet points above (from early 2007) remain current. However we would now add:-
To drive system innovation to Scale Up and Speed Up how people everywhere can help deliver sustainable innovation and roll out development - to create a better world.
To be inclusive fair and intelligently governed.
Status and Execution
In order to launch this bold, exciting and much needed venture we are raising £11m of equity to set up the team and core infrastructure - and launch on a cut back level to test core assumptions. The aim is to then raise additional rounds of equity to then enable the raise of the SDG 360 Fund.
In what we term the 'butterfly basket' portfolio structure, in three year cycles the SDG 360 fund (at min target size) will invest in many early stage investments, of which through multiple rounds, a progressively smaller number will receive more equity investment. The small number of later stage investments help manage risk and deliver portfolio returns - whilst also enabling a healthy level of early discovery early on and significant impact throughout the entire portfolio
As the name suggests, the SDG 360 fund will invest in stages of £360m. Every staggered cycle (starting every 3 years, then reducing to each 1 year period):
360 investments will receive £1m, of which;
90 investments will receive £4m (£5m in total), of which;
30 investments will receive £12m (£17m in total), of which;
12 investments will receive £30m (£47m in total), of which;
6 investments will receive £60m (£107m in total), of which;
3 investments will receive £120m (£227m in total), of which;
1 investment will receive £360m (£587m in total).
The structure includes a £360m Special Opportunities fund, and £360m which is structured to be invested into Transform Global (which will be managing the fund) to build capacity to raise external investment for investee organisations - and so that all interests are aligned.
A special feature of the fund, is that surplus (non invested capital - circa £3.5b plus in year one) will be invested into a small risk adjusted portfolio of top money managers, with the objective to maintain ongoing investment capacity and to build up the asset base.
All parts of the combined 'bank' business model shown have comprehensive business plans. Initial management and advisory teams are lined up. When the initial equity is raised, the team will be added to in order to position for and to raise subsequent investment rounds.
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