GFI created a Market Access Fund to address the problem of global poverty by funding trading networks to bridge the gap between poor producers and markets. Synapse makes investment-grade grants and cultivates long-term financial relationships with scalable initiatives, helping to build the strength and capacity of grassroots producers and rural communities.
Synapse operates on the cutting edge of philanthropy by applying investment strategies to charitable giving. It identifies organizations with viable business models and innovative approaches to opening new markets and cultivating opportunities for grassroots producer products. Candidates for funding in this new model of venture philanthropy are measured by three fundamental criteria:
With these pillars in place, modest initiatives grow into robust and far-reaching market access solutions. And once funded, investments are carefully monitored, guided and supported by Synapse in order to achieve long term success and self-sufficiency.
Who are “Grassroots Producers”?
There are currently over one billion self-employed workers in the global informal economy, operating without a social safety net and almost totally disengaged from their nation’s formal structures of taxation and regulation. Yet these workers are an integral part of a globalizing economy.
“Grassroots producers” are the working poor in the informal economy. Throughout the developing world, grassroots producers have banded together to form grassroots producer organizations (GPOs), which build the collective capacity of poor producers to leverage capital and facilitate trade.
Why Trading Networks?
The advent of micro-credit investment has made capital available to GPOs around the world. GPOs have used this capital to invest in productive assets and to produce an array of consumer and commodity goods. Yet while microcredit has addressed fundamental financing issues, it remains inadequate to meet the broader needs of market development. So, despite the powerful growth engine of microcredit, GPOs have not fulfilled their commercial potential due to their lack of market access.
The formal business sector circumvents these challenges through trade associations, chambers of commerce and special interest groups that facilitate global trade and investment. No such support exists for poor producers.
Reliable access to regional and global markets is critical to long-term income growth and the alleviation of poverty and subsistence living. The Synapse Market Access Fund addresses this lack of access and support by investing in trading networks to ensure that poor producers in low-income countries have an opportunity to sell their goods.
The Synapse Value Proposition
Despite the great potential of trading networks, multilateral organizations and other donor sources are only just beginning to explore trading networks as a tool in the fight against poverty. There are currently no substantial funding mechanisms for projects that build trade infrastructure and trading networks that directly benefit grassroots producer groups.
The Synapse Market Access Fund aims to fill the funding gap by raising funds to invest in trading networks for poor producers.