What Prevents Innovators from Accessing Private Capital— A PAEGC Perspective

On October 21st, the WE4F Learning Session “What Prevents Innovators from Accessing Private Capital – A PAEGC Perspective” dove deep into the topic of access to finance for innovators. Jeff Engel, Finance and Business Advisor to “Powering Agriculture (PAEGC)”, discussed both barriers and solutions to mobilizing additional investments on the basis of the PAEGC report: “Access to Financing for Early-Stage Innovators in the Clean Energy-Agriculture Nexus”. The session presented key findings from both literature reviews as well as interviews with investors, innovators and program stakeholders and identified opportunities to support innovators better in overcoming these barriers. The session highlighted that often not the availability of funding is the issue but rather the access to funding with innovators having limited knowledge of financial markets and receiving inconsistent investment support. The key barriers to raising capital were identified as: Investor fatigue, lack of investment & credit readiness, deficiencies in investor discovery, and a lack of profit motivation. Possible solutions to these barriers were delineated, including the consultation of investment liaisons, the provision of targeted trainings to build financial acumen, and the engagement of local and regional financiers. Finally, WE4F showcased shortly how the PAEGC lessons learned where considered in the design of the new program to ensure more efficient support and greater scale of innovations.

If you want to learn more about financing projects for lower-income consumers check out the resources below as well as our learning sessions on Base of the Pyramid (BoP) customers and on designing technical assistance for women-led projects.