September 27, 2007, New York – Omidyar Network, a mission-based organization established by Pierre and Pam Omidyar, today announced at the Clinton Global Initiative that it is expanding its efforts to include support of small to medium enterprise (SME). Building on the momentum of its work in microfinance, the organization plans to invest US$10 million in the global SME sector over the next two years, as part of its efforts to increase opportunities for economic participation for citizens in developing countries around the world.
"Fostering small to medium enterprise will generate tremendous empowerment for individuals and their communities,” said Jim Bunch, director of investments at Omidyar Network. “Entrepreneurs are able to bring their passions and skills to market, creating economic and social value for themselves and their families. When these enterprises succeed and scale, this value can be shared with new employees, their families, and the community at large."
Omidyar Network aims to create a level playing field for small to medium enterprise entrepreneurs by providing access to the financial products and services that are integral to their success. Access to financial services is an important component of economic empowerment, and microfinance has brought that access to approximately 100 million people who would otherwise not qualify for mainstream financial services. However, a gap in the size of loans continues to exist between what microfinance institutions can provide and the larger investments of commercial banks, leaving many small to medium enterprises without formal funding options.
By addressing the “missing middle” between microfinance and mainstream financial institutions, Omidyar Network intends to spur the creation of formal funding options for small to medium enterprise, including those microfinance clients whose success has propelled them beyond the scope of microfinance.
Stimulating small to medium enterprise has the potential to create jobs not just for the entrepreneur, but for the others he or she employs, giving those at the bottom of the pyramid options for economic opportunity beyond microfinance or the informal sector. In addition, connecting small to medium enterprise with the formal financial system will allow clients better terms on a more reliable basis.
About Omidyar Network:
Omidyar Network is a mission-based organization founded by Pam and Pierre Omidyar, the founder of eBay. Established in 2004, Omidyar Network is committed to creating opportunity for individuals to improve the quality of their lives. Omidyar Network uses an expanded toolset to advance its mission, supporting both businesses and nonprofits that promote equal access to information, tools and opportunities; connections around shared interests; and a sense of ownership for participants. To date, Omidyar Network has created a diverse portfolio that fosters empowerment across the economic, political and social realms, with investments in areas such as microfinance, participatory media, philanthropic markets, and transparency in government.