CFYE is looking to support and seed the establishment of an investment fund that will focus on the “Create” and to some extent can consider “Improve” employment outcomes. The fund is expected to provide growth capital to Small and Medium sized Enterprises (‘SMEs’) that are well-positioned and have the intention to grow their workforce by investing and employing youth. These enterprises need capital to expand their businesses, yet are poorly served by existing finance providers. Established fund managers, with a track record of financing SMEs in some or all of the regions mentioned above and proven track record in developing and implementing robust frameworks for measuring social impact, are invited to submit a proposal to become the manager of the Fund. Any DIFYE specific questions can be sent to email@example.com.
The objective of the Fund is to identify and support those enterprises that, through their growth, can grow the number of quality jobs for young people (defined as being between 15 and 35 in age), especially young women (with the explicit target that 50% of jobs created need to be for women). The fund is expected to create at least 25,000 jobs by December 2025.
The structure and strategy of the Fund need to be geared towards this aim. How this is achieved, what companies in which of the focus countries to target, what type of financing to offer, etc. is left to the fund manager to suggest through its proposal. A clear theory of change, setting out how the objective of generating job opportunity for youth will be achieved, is a core part of the proposal.
Fund Manager Role
It is anticipated that the Fund Manager will manage the entire investment process. This will include:
- Pipeline creation
- Preparation of Investment Committee materials and presentation of the opportunity
- Due diligence, negotiation, structuring and documentation of the investments
- Management of liquidity and FX exposure, as well as other back-office functions
- Portfolio monitoring and reporting
- Sourcing of exit opportunities (where needed)
- Raising capital (with support from a placement agent)
Certain responsibilities are expected to be taken on by third parties, e.g. auditor, custodian, transfer agent and registrar.
We hosted a webinar on the Dutch Investment Fund for Youth Employment on Wednesday, July 22nd (15:00 to 16:00 hours (GMT+2) Netherlands Timezone). You can watch the recording below.
Request for Proposal
Interest parties are invited to respond to this Request for Proposal. You are requested to submit a proposal of not more than 30 pages providing answers to the questions in the full ToR.
You are kindly requested to submit your proposal by e-mail, no later than 15 September 2020, to firstname.lastname@example.org.
A shortlist of prospective fund managers will be invited for a presentation in September, conducted virtually and designed to expand on the written submission. This will help us achieve a better understanding of the alignment in terms of philosophy, approach to promoting youth employment and measuring impact.
After the workshops, Palladium anticipates selecting a preferred bidder. The evaluation criteria are specified in Appendix II. Palladium will enter into final negotiations on an exclusive basis with the selected Fund Manager.
The Challenge Fund for Youth Employment is funded by the Netherlands Ministry of Foreign Affairs, and managed by Palladium, in partnership with VSO and Randstad. This call for concept notes is the first stage of the application process, and successful applicants will progress through to the next round, where they will be invited to submit a detailed proposal and business case.