Draft Alternative Capital Taxonomy
™ Village Capital, Zebras Unite, Novel GP
Alternative Capital Taxonomy
Capital Suppliers/Investors Capital Seekers/Businesses
*From the Collaborative for Frontier Finance, The Missing Middles: Segmenting Enterprises to Better Understand Their Financial Needs, 2018
Capital Suppliers/Investors
Capital Sources
Family/Friends
Employers/Business Networks
Crowdfunding
Governments
Philanthropy
Private/Venture Capital funds
Banks/Credit Unions
Capital Suppliers/Investors
Debt
Mezzanine
Equity
Asset-Based Lending
Leasing
Trade Financing
Cash-Flow Lending
Working Capital
Unsecured/Junior Loans
SHARE
Revenue-Based Investing
Profit Share / Demand
Dividend
Redeemable Equity
SAFE
Convertible Notes
Shares
Capital Structures*
Lower Risk
Higher Risk
High Risk
*From the Collaborative for Frontier Finance, The Missing Middles: Segmenting Enterprises to Better Understand Their Financial Needs, 2018
Grants
Grants
Loan Loss Guarantees
Low Risk
Capital Suppliers/Investors
Debt
Mezzanine
Equity
Forgiveness
Term payments (interest,
principal, balloon)
Refinancing
Redeemable Equity
Trade sale / M&A
IPO
Mandatory Dividends
Exit Structures*
Grants
More Grants
Conversion to for-profit
model
*Adapted From the FLII Masterclass on Structured Exits (Transform Finance, Candide Group, IDB Lab, Adobe Capital, EcoEnterprises, Acumen Fund), 2019
Capital Suppliers/Investors
Decision-Making Processes*
Data-Driven (Capital-as-a-Service)
Internal Decision-Making
Investment Committees
Pitch Competitions
Peer Review
Crowdfunding
*From Village Capital, Capital Evolving: Alternative Investment Strategies to Drive Inclusive Innovation, 2018
Capital Seekers/Businesses
Business Profiles*
High Growth: Disruptive business models, large markets, high growth, fast scale, high risk
*Adapted from From the Collaborative for Frontier Finance, The Missing Middles: Segmenting Enterprises to Better Understand Their Financial Needs, 2018
Niche: Innovative products & services, niche markets / customer segments, steady to high growth
Dynamic: Established industries & sectors, existing products, proven business models, steady growth
Livelihood: Opportunity-drive, family-run, highly localized, limited growth
Category pioneers: disruptive products & services, new / large markets, variable growth & scale
Capital Seekers/Businesses
Main Street
Zebras
Silicon Valley
Growth Profiles
Slower Growth Rapid Growth
High Growth
Niche For-Profit
Niche Social Enterprise
Dynamic For-Profit
Dynamic Social Enterprise
Livelihood-Sustaining
Category Pioneers
Questions to consider:
Categories
Next Steps: Mapping and Matching
Mapping A User Journey
Business Characteristics
Growth Profile
Business Model Target
Capital
Utility
Growth
Strategic
Seasonal
Capital Characteristics
Capital Structures
Exit Structures
Decision-making
Investor Types
Capital Sources
Risk / Return profile
Mapping A User Journey
Business Characteristics
Growth Profile
Business Model Target
Capital
Utility
Growth
Strategic
Seasonal
Capital Characteristics
Capital Structures
Exit Structures
Decision-making
Investor Types
Capital Sources
Risk / Return profile
Mapping A User Journey
Business Characteristics
Growth Profile
Business Model Target
Capital
Utility
Growth
Strategic
Seasonal
Capital Characteristics
Capital Structures
Exit Structures
Decision-making
Investor Types
Capital Sources
Risk / Return profile
Questions to consider:
Mapping
Thank You!