SURVEY BLOG BONDY In July 2016, the Ile-de-France announced the investment of € 7 million for the economic development of the districts. The budget assigned to a management company, in reality, finance as franchise business of large retailers through loans with relatively high interest rates. In a year and a half, only an entrepreneur created his franchise.
The announcement was to mark the occasion, that of a major political decision in favor of the districts. In July 2016, the Ile-de-France, chaired by Valérie Pécresse, announced an investment of seven million for the economic development of priority neighborhoods of Île-de-France. The ambition of the elected LR “stimulate sustainable” business creation and employment and “break with the failed policies”.
It must be said that the economic and social situation of these districts continues to deteriorate for thirty years: almost one out of two from priority neighborhoods of urban policy is unemployed. Nearly 40% of the inhabitants of these QPV also live below the poverty line, according to the National Observatory of Urban Policy, almost three times more than the national level.
Seven million euros of public money managed by private funds
The peculiarity of the investment decided by the Ile-de-France? The seven million euros of public money voted by the Regional Council are not managed by the region itself but entrusted to Impact Partners, an investment company. The Manager has established an especially dedicated to neighborhoods fund, dubbed Impact Creation. Besides the seven million invested by the region, the fund was fed up of at least three million by several co-investors, as the French Games, Bpifrance, Public Investment Bank and BNP Paribas.
Contrary to what the communication suggests the region, so the fund was not created by the region itself but by a private investment company managing this public investment of seven million. Impact Partners, as any fund manager fee also fees on the amount invested.
Screenshot of the page dedicated to the announcement of the investment of 7 million euros on the site of the Île-de-France region
Franchises major retailers, only beneficiaries of the fund companies
His second feature? Finance franchise businesses only. Impact Partners, which markets Creating Impact as the “Monte Your Franchise,” has partnered with fifteen franchisors, including Burger King, Carrefour, Blue Elephant, Pizza Hut, and Courtepaille Pharmactiv pharmacy network. “Small businesses funded over the last thirty years have a very low rate of survival” justifies Yasmine Hamraoui, Director of Impact Partners. A finding confirmed by a note INSEE indicating that “the survival rate in 2014 of the companies created in 2010 is lower by almost 10 points in priority neighborhoods” although INSEE states that “over 60% creators in priority neighborhoods prefer the status of self-entrepreneurs “.
The logic is to bet on franchised shops, more likely to thrive. “The franchise business benefits from the experience, advice and the image of stores, including helping to implement the right place to succeed,” said Yasmine Hamraoui. Beyond loans – 25 000 to hundreds of thousands – Impact Partners supports entrepreneurs in their dealings with banks and offers free legal services. “We have studied 500 nominations we receive every day,” says the director ensures that thirty of promoters files should result in 2018.
During the announcement of the establishment of a fund in July 2016, the choice of Impact Partners had not yet taken place and everyone knew then that the project would be aimed only at franchised shops. The financial terms and management of the fund remained unclear. In July 2016, when the explanatory memorandum of the fund, the majority in the Regional Council indicated that public support would be “through capital-equity or quasi-equity through private equity funds. The selection of the management company managing this fund will be an open and transparent selection process. ” The call for expressions of interest was launched by the Île-de-France region September 12, 2016, and ended on October 26, 2016. It was in December 2016 that Impact partners won the call for projects.