Omidyar Network, a philanthropic investment firm begun by the founder of eBay, has announced a three-year grant of USD 9 million in Unitus, a Seattle-based non-profit that facilitates access to capital and consulting services to high-potential microfinance institutions (MFIs).
Omidyar’s largest microfinance grant to date will allow Unitus to grow its portfolio of start-up and early-stage MFIs and expand into several new regions. It comes in the wake of last year’s Unitus Leadership Summit, which was attended by Pierre Omidyar and Omidyar managing partner Matt Bannick.
“Pierre and I were impressed by the energy and enthusiasm with which Unitus and its partners are extending the reach of microfinance and transforming the lives of the poor,” Bannick said in a statement.
In March, MicroCapital reported on the growth of Unitus’ partner network during 2007. In February, Omidyar collaborated with the Soros Economic Development Fund and Google.org to launch a USD 17 million small-and-medium-enterprise investment company for India. Last April, MicroCapital published a five-part examination of eBay’s forays into microfinance, which included a look at the Omidyar Network.
Based in California, the Omidyar Network comprises a 501(c)(3) non-profit and a limited liability company (LLC) – making grants through the non-profit entity and investments in for-profits through the LLC. It grants to and invests in ideas and organizations that are expected to generate both financial value and social returns, including microfinance, scientific innovation, participatory media, and information networks. As reported in its 2006 tax return, the organization had USD 284.2 million in assets.
Unitus uses a “highly leveraged, results-focused model” to target microfinance partners, connect them with capital, and provide business tools and consulting services in seven countries. Among its criteria for partner evaluation are a focus on poverty, growth potential, legal structure, organizational and managerial strength, governance, portfolio quality, and need for capital. Although Unitus itself is not a direct lender to the poor, the gross loan portfolio of all its partners as of year-end 2006 (Annual Report) totaled USD 115.4 million.
By Stephen Son
Additional Resources:
Unitus: “Omidyar Network and Unitus to Help Millions of the Working Poor Participate in the Global Economy”; Annual Report 2006
MicroCapital.org article, November 8, 2007: “Unitus Convenes Microfinance, Business and Philanthropic Leaders to Scale the Effort to Reduce Global Poverty”
MicroCapital.org article, March 4, 2008: “Unitus Inc., a U.S. Nonprofit, Doubles Reach of Its Global Microfinance Partner Network in 2007”
MicroCapital.org article, February 28, 2008: “PRESS RELEASE: Soros Economic Development Fund, Omidyar Network and Google.org Launch $17m Small to Medium Enterprise Investment Company for India”
MicroCapital.org article, April 25, 2007: “eBay Enters Microfinance, Part 3 of 5: Who Is Oz? eBay Founder Pierre Omidyar has Lots of Levers”
Omidyar Network: About Us; 2006 Form 990-PF
MIX Market: Profile for Unitus
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