According to Supply Nation, for every dollar of revenue, Indigenous businesses create $4.41 of economic and social value, yet many First Nations entrepreneurs face barriers to accessing the appropriate capital needed to start and scale their businesses. Access to commercial lending can be challenging for First Nations businesses due to low intergenerational wealth transfer, lower rates of home ownership, and difficulty satisfying commercial lending criteria.
PRF partner First Australians Capital (FAC), an Indigenous-led organisation providing capacity building services and access to capital for Indigenous businesses, is trying to address these barriers. FAC is focused on economic independence and self-determination for First Nations entrepreneurs, helping to address racial inequity in Australia’s finance sector.
PRF first supported FAC in 2020 with a small impact investment in a pilot fund, and since then has provided a range of support including $10 million in grant funding, non-financial technical assistance, and more than $5 million repayable finance to FAC’s Catalytic Impact Fund, which connects investment markets with the Indigenous economy, offering accessible, patient debt finance to support Indigenous businesses.
Ben Smith, PRF’s Head of Impact Investing, says PRF’s support of FAC is part of a larger effort to invest in community-led funds, a strategic focus for PRF’s impact investing team since 2023.
“We believe that those with lived experience of societal and environmental challenges are best placed to disburse capital to the communities they serve.
“By enabling communities to hold their own capital, power dynamics can be redressed, and funds can flow to those who can create the greatest impact.”
The Catalytic Impact Fund, which launched earlier this year, has already issued $8 million in funding to Indigenous-led businesses, enabling entrepreneurs the opportunity to thrive and contribute to larger scale economic development. In the two years since FAC started raising funds for what would eventually become the Catalytic Impact Fund, more than 200 businesses were supported creating more than 1,800 economic participants through employment, business ownership and supply chain enabling within the Indigenous economy.
Ben says that by seeding and supporting community-led funds owned and driven by those with deep sector knowledge and lived experience, PRF can help “increase the market of sustainable impact funds and attract capital from new and diverse sources.”
The Chair of FAC’s Board, Jocelyn King, says that PRF’s support has empowered the organisation to decide how to approach its strategy to better support First Nations businesses and entrepreneurs and create more opportunities for Indigenous peoples.
“PRF’s commitment to FAC is allowing us to unlock innovation and self-determination for hundreds of Indigenous businesses and founders,” she says.
“FAC is building a community of investors and investees premised on overcoming systemic barriers to finance, driving a new economy and building economic independence for Indigenous people and communities.
“Big social change occurs when we all work together.”
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This story was first published as a case study in PRF's 2024 Annual Review.
