Australian Indigenous Investment & Finance in 2019

$US500 billion is a decent number. Its not a random number either – it’s what the Global Impact Investing Network estimate the current global pool of impact investing capital to be. The prospect of just 1% (i.e. $AUD7 billion) of that pool of investment capital coming to Australian Indigenous ventures is worth a look.

The power of capital includes the power to find and support compelling ideas and innovation. Capital provides a means to scale up what works, to meet market needs or to transform ideas and create a new market altogether. Capital moves fast. It needs to find a home as quickly as possible. The transformational potential of investment capital deserves closer examination.

Many solutions in Indigenous Australia apparently come with big price tags. A lot of frustration within Indigenous communities is a by-product of under-capitalisation. Of not scaling-up what works. Being dependent upon government capital capital and budget-to-budget grant funding can crush ideas. What if the model was re-set? What if the sources of capital for what works expanded? What if commercial possibilities and social enterprises were able to attract impact investors?

What if $AUD7 billion was mobilised into Indigenous Australian ventures?

This is the potential of a fast-growing pool of impact investment that wants to mobilise Indigenous enterprise and innovation for transformation at scale. It could force a rethink of the appropriate response to demands for seed capital, expansion capital or deals for mergers and acquisitions. It would surpass philantropy and government in one leap to free Indigenous ventures of the shackles of government policy settings.

Last month, the 10th World Indigenous Business Forum (WIBF) in Vancouver, Canada included keynotes on the possibilities for impact investing into Indigenous ventures and several side-bar meetings with global impact investors.

WIBF attracted a large delegation of Australian Indigenous businesspeople and entrepreneurs. Indigenous Business Australia, Supply Nation, DFAT/Austrade and Minister Ken Wyatt's National Indigenous Australians Agency supported delegates. A special note to all the self-funded Indigenous businesses that attended. Amongst the delegation were investment-ready Indigenous businesses. Their example will inspire.

WIBF, and other similiar events, confirm a willingness from global investors to support Indigenous ventures at every level of the business cycle.

There is opportunity for Indigenous businesspeople to build investment readiness and to take their ventures to market.

Money markets that were small three years ago today are fast growing, and impatient to invest. To assist a World Indigenous Business Network (WIBN) will continue to link investors with Indigenous interests with a global network in ways that individual countries and entrepreneurs cant. Lets consider the practicalities.

Firstly, this is investment; not charity or grants. Nor is it vulture capital either. Impact Investors want to see a financial return and achieved social impacts. This isnt for every Indigenous venture. However, those that have commercial prospects, solid growth potential and a commitment to grow their enterprises will find a welcome mat.

Secondly, just as the mainstream economy has diversity from sole operators, family businesses, SMEs and on to large companies and corporations the same is unfolding in Indigenous Australia. We are fast approaching the day when there are Indigenous companies with market capitalisations at $100m, $200m and $500m. These companies will have significant R+D budgets, an appetite for growth and planned impacts that are consistent with their Indigenous values.

Third, as this occurs we will need the investment and finance infrastructure to develop and meet those needs. Indigenous Australia will need specialist advisors for investment and finance. A school of dealmakers that seek out value creating opportunities. High performing executives will lend their support to growth strategies and ambitious boards.

Last, it will be competitive. There is a limited number of suitable, viable ventures and possible transactions in Indigenous Australia today. Its a finite number. Once those transactions have been uncovered and completed they will be off the table. If you didnt get yours as an investor then too bad. The race to find those enterprises and ventures has already begun. Once those Indigenous ventures with the compelling investment proposals are capitalised and away the transformation may very well catch Australia by surprise.

It might be like when Apple caught entire industries by surprise with the iPhone. That was transformational. Who doesnt want to transform Indigenous Australian investment, finance and enterprise for the better?