What are the statistics on global displacement?

Currently, there are about 84 million people displaced worldwide. This number is projected to quadruple in the coming decades due to factors like climate change, conflict, and poverty.

What percentage of venture capital funding goes to women and minority founders?

In 2021, only 2% of venture capital funding went to women. Furthermore, only 0.032% went to Latina founders and 0.006% to Black female founders. Statistics for BIPOC-led, women-led, and refugee-led impact companies are even smaller.

What is Eat Offbeat and its mission?

Eat Offbeat is a refugee-driven food company based in New York City. It creates quality jobs for refugees, builds bridges between refugee chefs and customers, and aims to change the narrative around refugees by showcasing them as skilled culinary professionals contributing positively to the economy.

What is Amplio Ventures and its investment focus?

Amplio Ventures focuses on growth capital for businesses that provide stability for refugees. They invest in refugee-founded businesses, companies employing a large number of refugees, and enterprises offering services aimed at refugee stability, aiming to restore their dignity and economic well-being.

What are the primary challenges faced by refugee founders when seeking investment?

Refugee founders, especially women and migrants, face significant disadvantages. Investors often confuse their for-profit impact businesses with non-profits, direct them to gender-lens or refugee-focused funds that may not be a fit, and sometimes overlook their capabilities, directing questions to male co-founders.

How does Eat Offbeat train its chefs for large-scale operations?

Eat Offbeat transitions talented home cooks with strong culinary skills into professional kitchen environments. The main training involves scaling their ability to cook for thousands of people, a significant operational shift from cooking for smaller family or event gatherings.

What is Dalton Sirmans' advice for impact investors and social entrepreneurs?

Dalton advises that for-profit impact businesses must first be good businesses, prioritizing financial health for sustainability. He also stresses the importance of investing in quality salespeople to effectively 'always be selling' the product and the vision to customers and funders.

What are the criteria Amplio Ventures uses to select businesses for investment?

Amplio Ventures looks for businesses that have a product/service, some customers, and initial seed funding. They assess the business model and the entrepreneur's potential and support system, focusing on individuals who can pivot and sustain profitability, with a goal of creating employment for more displaced people.

What advice does Manal Kahi give to aspiring or current founders?

Manal advises founders not to be intimidated by traditional investor demographics. She emphasizes having a clear 'North Star' or core mission to guide decisions, even when pivoting, and encourages having financial documents ready to defend the business model effectively.

Are there funding opportunities for refugees internationally, especially in camps?

This is a significant challenge. While philanthropic avenues exist, securing investment for refugees in camps or internationally is difficult. Acumen is mentioned as an impact investment firm that works outside the US, but specific, accessible funds for camp residents are scarce.

What would have made the biggest difference for Eat Offbeat in its early stages?

Having more money to hire the right team early on would have made the biggest difference. This would have allowed Manal, the founder, to focus on her leadership role instead of filling operational gaps like delivery or purchasing, accelerating company growth and reducing personal burnout.

Key Moments

How Refugee Founders of Impact Companies are Succeeding Against the Odds

MIT OpenCourseWare

Education4 min read63 min video

May 12, 2022|53 views|1

Migration Summit MIT ReACT Higher Education Workforce Development Displacement Refugees

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Key Moments

TL;DR

Refugee founders face funding hurdles, but impact investors and new models are emerging.

Key Insights

Impact investing is growing, but BIPOC, women, and refugee founders receive a minuscule fraction of VC funding.

Refugee-led businesses are often miscategorized as nonprofits, facing an uphill battle for investment.

Success requires a strong business model and financial viability, even for social enterprises.

Personal connections and investors who are mission-aligned are crucial for early-stage funding.

Entrepreneurial drive among refugees is high, but access to capital and networking remain significant barriers.

Mentorship, experienced salesmanship, and a clear 'North Star' are vital for founders' success.

THE DISPARITY IN IMPACT FUNDING

The session highlights a significant disconnect in the impact investing landscape. While social impact is increasingly a focus for corporations and investors, evidenced by the rise in CSR reports and a burgeoning impact investing market worth billions, a stark reality for many founders, particularly those from underrepresented backgrounds, persists. Specifically, BIPOC, women, and refugee founders receive only a tiny fraction of venture capital funding, with statistics revealing dismal percentages for female and minority founders, a trend that is extrapolated to be even more severe for women-led or refugee-led impact companies.

SUCCESS STORIES: EAT OFFBEAT AND NEEDSLIST

Manal Kahi, co-founder and CEO of Eat Offbeat, a refugee-driven food company, shared her journey. Eat Offbeat creates quality jobs for refugees, builds cultural bridges through authentic cuisine, and aims to shift the narrative surrounding refugees by showcasing them as skilled contributors. Similarly, Amanda Levinson, co-founder and COO of NeedsList, a tech company providing solutions for humanitarian crises, discussed their work, emphasizing that people closest to problems are best positioned to solve them. Both founders' ventures demonstrate that for-profit models can drive significant social impact.

CHALLENGES IN SECURING INVESTMENT

Manal Kahi detailed the arduous path to securing investment for Eat Offbeat. Founders often face the misconception that their social mission equates to running a nonprofit, leading investors to redirect them to CSR departments or non-profit funding streams rather than engaging in serious investment talks. This miscategorization consumes valuable time, diverting focus from defending the business model to explaining its for-profit nature. Additionally, impact investors, while well-intentioned, often have specific, large-scale impact metrics that smaller, high-quality job-creating businesses may not initially meet.

AMPLIO VENTURES: A DEDICATED IMPACT INVESTOR

Dalton Sirmans, General Partner at Amplio Ventures, explained his firm's mission to invest in businesses that provide stability for refugees, whether they are refugee employers, founded by refugees, or provide services supporting refugees. Amplio Ventures emerged from a recruiting business that placed thousands of refugees in meaningful work. They identified a need for capital for refugee entrepreneurs and established a fund to address this gap, viewing entrepreneurship as a pathway for forcibly displaced people to regain economic stability and dignity. Amplio focuses on businesses that can restore refugee stability through growth capital.

THE CRITERIA FOR INVESTMENT AND ENTREPRENEURIAL ADVICE

Amplio Ventures looks for businesses with a viable product or service, existing customers, and some initial funding. Crucially, they invest in the individual entrepreneur, assessing their support system and ability to pivot the business. Profitability is emphasized as key to sustainability, as continuous fundraising can be a drain. For aspiring founders, Manal Kahi advises not to be intimidated by traditional investor demographics, to be prepared with solid financial documents, and to maintain a clear 'North Star' or core mission. Resilience, adaptability, and a focus on building a strong team are highlighted as essential.

OVERCOMING BIAS AND BUILDING THE MARKET

Dalton Sirmans attributes the scarcity of investors like Amplio to ingrained biases and a traditional view of refugee support being solely the domain of NGOs and government agencies. The rise in nationalism has further exacerbated these barriers. He notes the market for refugee-focused investors is immature, requiring significant effort to educate potential funders. Sirmans also stresses the critical need for entrepreneurs to invest in quality salespeople, emphasizing that 'always be selling' – both the product and the investment opportunity – is fundamental to success.

THE IMPORTANCE OF EARLY-STAGE CAPITAL AND NETWORKING

A significant challenge highlighted is the lack of seed funding for refugee entrepreneurs to move from idea to prototype. Manal Kahi emphasized that more capital early on would have allowed her to hire key personnel, enabling her to focus on leadership and growth rather than being involved in every operational aspect. This lack of early funding forces founders to rely heavily on business competitions, which can be time-consuming and may not yield substantial returns. Building networks and finding investors personally invested in the cause are crucial for navigating these early hurdles.

ADDRESSING INTERNATIONAL FUNDING NEEDS

While the discussion primarily focused on the US, the question of international funding for refugees in camps like Kakuma was raised. While specific investment opportunities are scarce and often inaccessible due to scale, organizations like Acumen were mentioned as potential impact investors operating internationally. The challenge of networking with funding sectors, especially for those in refugee camps, remains a significant barrier, often leading to innovative ideas not receiving the necessary support to flourish.

Mentioned in This Episode

●Companies

●Organizations

●Concepts

●People Referenced

Common Questions

The Migration Summit is a month-long global convention organized by organizations like the MIT Refugee Action Hub, Na'amal, and Karam Foundation. This year's theme is education and workforce development in displacement, aiming to connect diverse communities to address challenges and opportunities for refugees and migrants worldwide.

Topics

Human Performance Business & Entrepreneurship Society & Philosophy Startup Growth Social Enterprise Refugee Employment Funding Challenges Refugee Entrepreneurs Impact Investing Diversity In Business

Mentioned in this video

organizationKaram Foundation

A co-organizer of the Migration Summit, focused on refugee communities.

organizationPaper Airplanes

An organization that co-organized the Migration Summit.

organizationMIT Refugee Action Hub

An organization involved in organizing the Migration Summit, focusing on refugees and migrants.

organizationNa'amal

An organization that co-organized the Migration Summit.

organizationMIT J-WEL

An organization that co-organized the Migration Summit.

companyEat Offbeat

A refugee-driven food company that delivers authentic meals conceived and prepared by refugees resettled in New York.

companyAmplio Ventures

A venture capital firm focused on providing growth capital for businesses that restore refugee stability, including refugee founders and employers.

personChris Chancey

Business partner of Dalton Sirmans, founded Amplio Recruiting in 2014 to find meaningful work for refugees.

personZeinab Badawi

Mentioned as a source of inspiration for Lorraine Charles's questioning style.

personAmanda Levinson

Cofounder and CEO of NeedsList, moderating the panel.

personChase Carroll

Partner at Amplio Ventures who lives in Kigali, Rwanda.

companyThe Guardian

A media outlet that featured Eat Offbeat.

companyFast Company

A media outlet that featured Eat Offbeat.

conceptB Corp

A certification for companies that meet high standards of social and environmental performance, accountability, and transparency. Yasmine Mustafa's company is a B Corp.

organizationAcumen

An impact investment firm that invests significantly outside the US.

companyComcast

Mentioned as an example of a company that supports refugees but might not be the primary focus for funding.

companyNeedsList

A women-led tech company developing automated needs-to-resource matching software for humanitarian emergencies and natural disasters.

organizationThe Huffington Post

A media outlet that featured Eat Offbeat.

companyAKKR

Acquired Dalton Sirmans' company, Main Street Technologies, in March 2018.

organizationInternational Rescue Committee

A partner organization with Eat Offbeat, helping to source talented home cooks who are refugees.