What is Patient Capital?

The markets alone cannot solve the problems of poverty; nor are charity and aid enough. Two-thirds of the world’s population still lives in poverty, and we need new approaches in order to find new solutions. We also need to recognize how challenging it is to build large-scale, lasting solutions in some of the toughest environments in the world. There are no easy answers.


Patient capital investing is a third way to solve tough problems. It bridges the gap between the efficiency and scale of market-based approaches and the social impact of pure philanthropy. Patient capital has a high tolerance for risk, has long time horizons, is flexible to meet the needs of entrepreneurs, and is unwilling to sacrifice the needs of end customers for the sake of shareholders. At the same time, patient capital ultimately demands accountability in the form of a return of capital: proof that the underlying enterprise can grow sustainably in the long run.

We are seeing exciting new business models capable of bringing affordable, life-changing products and services to the poor. These businesses are transforming the lives of their customers, and are creating jobs that lead directly to economic growth.

Starting a new business is always tough and starting a business in the developing world can be much tougher. Launching a business that focuses on the needs of the world’s poorest often seems impossible. Patient Capital is the scarce resource that allows new, sometimes crazy, potentially world-changing ideas see the light of day.


For Acumen, patient capital is understood as a debt or equity investment in an early-stage enterprise providing low-income consumers with access to healthcare, water, housing, alternative energy, or agricultural inputs. Our typical commitments of patient capital for an enterprise range from $300,000 to $2,500,000 in equity or debt with payback or exit in roughly seven to ten years.

The patient capital Acumen provides is accompanied by a wide range of management support services nurturing the company to scale. Our aim in investing patient capital is not to seek high returns, but rather to jump-start the creation of enterprises that improve the ability of the poor to live with dignity. In the long-run we aim to see a return of our capital.  We do not expect high financial returns to come from investing in businesses that serve the poor.

We define patient capital as having the following characteristics:

  • Long time horizons for the investment
  • Risk-tolerance
  • A goal of maximizing social, rather than financial, returns
  • Providing management support to help new business models thrive
  • The flexibility to seek partnerships with governments and corporations through subsidy and co-investment when doing so may be beneficial to low-income customers.

Patient Capital In Action

WaterHealth International has impacted the lives of over 350,000 people, and they are still growing.

In 2004 Acumen invested $600,000 in WaterHealth International, a company that brings safe drinking water to rural Indians in a financially sustainable way. Many said this was impossible. One year after our first investment, WaterHealth had broken ground on two new water systems. But it was hard going, with both systems going over budget and past deadline. Working with Acumen to modify the design of the water facility to decrease costs, and after working to create efficiencies in their operations, a year later WHI had ten systems in operation, and had started to attract the interest of additional investors. Three years after our initial investment, WHI had raised $11 million in private capital and were speaking with banks about financing an additional 20 systems.

Today, WHI has developed over 500 systems worldwide giving access to safe water to over five million people, and they are still growing. With over $30 million now raised, this is a company that leveraged a powerful business model, dedicated leadership, and access to patient capital, to create an innovative new approach to tackling global water challenges. The company has recently expanded to Ghana through a partnership with Coca-Cola and Diageo called “Safe Water for Africa” which aims to bring safe water to 50 communities.

Flexible, long-term investments of patient capital for businesses like WHI are changing the way the world tackles poverty. To see how patient capital has impacted millions of other people, please take a look at our individual investment pages.