CALMEADOW HISTORY
History / Calmeadow at 20 / Organization / Contact
Calmeadow was founded in 1983 as a non-governmental organization (NGO) with the goal of supporting women in economic development. The experience of several founders with other charitable organizations led to the conclusion that the situation of charities involved with economic development warranted a more focused approach to charitable giving. Martin Connell, then working for a Canadian international charity, his wife Linda Haynes, a board member of another Canadian charity, and her father, Ced Hynes provided both the intellectual and financial drive for the newly created charity, which made contributions to a number of Canadian NGOs.
However, it was not until 1985 when Mr. Connell was introduced to Acción International that Calmeadow found its sought-after approach to economic development and poverty alleviation: microfinance. Efforts by Calmeadow to ignite the Canadian NGO community provided few results and pushed Calmeadow to back this revolutionary idea with its own capital by funding a few, discrete microlending programs in Latin America with Acción providing the program management. Calmeadow’s focus on the untapped potential of local microentrepreneurs increased over the years and activities ranged from translating and disseminating entrepreneurial training kits in West Africa to supporting loan programs in Brazil, Colombia, and Mexico to bringing the increasing knowledge about solidarity group lending to indigenous peoples in Canada.
Calmeadow took another big step forward in the late 1980’s when Mr. Connell, after a lunch with the then executive director of Prodem in Bolivia, Francisco Otero, began pursuing the idea of a commercial microlending institution that could provide enormous scale to the social and economic benefits provided by the handful of small NGOs making loans to microentrepreneurs at that time. A Calmeadow-funded feasibility study gave rise to the Cobanco committee which worked to produce a business plan, secure funding, and implement the transition to a bank serving microentrepreneurs. Alongside Acción, CIDA, USAID, IADB, IFC and others, Calmeadow continued to fuel the process that on January 24, 1992 produced BancoSol the first fully regulated bank specifically targeting the previously “un-banked” at the bottom of the economic pyramid.
During this period Calmeadow sought to promote a similar model in Canada. Between 1986 and 1994 Calmeadow launched four different microlending programs targeting different segments of Canadians, especially isolated indigenous populations and those in economically depressed areas. However, the widening focus of Calmeadow abroad prompted the realization that these niche programs could not achieve sustainability within Calmeadow and were thus turned over to partner institutions and credit unions. In addition, Calmeadow status as an innovator and very knowledgeable industry player in international microfinance kept it involved as a key advocate and supporter of a variety of projects. These projects include the MicroFinance Network to promote the exchange of ideas within the industry, the Micro-Enterprise Policy Institute to help build capacity among key-decision makers, preparing a global inventory of commercial MFIs for the IFC in 1997 and acting as an agent for the sale of assets from Prodem to BancoSol.
The successful creation of BancoSol inspired other MFIs to pursue the same model which in turn spurred Calmeadow, along with others who helped create BancoSol, to create a fund that would invest in and support these newly transformed financial institutions. The idea of investing in and thereby supporting MFIs through a common corporate governance system was arguably well ahead of its time. However, Calmeadow continued to push the idea, along with other like-minded organizations. Those efforts came to fruition in 1995 with the creation of ProFund, the first investment fund to target microfinance institutions. Again, Calmeadow provided key funding for a feasibility study and investment support to create the fund. The demonstration affect of ProFund has had a profound impact on the budding microfinance industry and caught the attention of a much larger group of funders looking for alternatives to traditional charity models. A similar process led to the creation of AfriCap another closed-end investment fund dedicated to supporting MFIs in Africa; AfriCap has since proved to be one of the most successful funds in all of Africa in recent years.
AfriCap has proved extremely successful and is a source of pride for Calmeadow. Success has carried the concept further than most could have imagined in 2001 and the idea has taken on a new form. In October 2007 the closed-end investment fund was transformed into a permanent legal entity and raised an additional US $50 million. While many of the original shareholders remain, some have been replaced by other private investors and the prospects for the new investment company appear strong.
Given the expansion, Calmeadow’s role in AfriCap has been reduced and the original fund management company, originally wholly-owned by Calmeadow, is no longer necessary given the new corporate structure. In addition, Calmeadow’s investment stake has been diluted. Calmeadow feels that these actions are the natural and proper evolution of the situation and could not be more pleased with the results. Calmeadow continues to leverage its extensive microfinance knowledge and thereby improve the industry as a whole. [link to “Calmeadow at 20”]
For more information about AfriCap, please click here.
History / Calmeadow at 20 / Organization / Contact
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