World YMCA and SecondMuse Capital have joined forces to develop innovative finance solutions that break down barriers to youth employment and create jobs in green economy. This collaboration aims to empower underserved young people by guiding them into meaningful work that offers self-sufficiency, dignity, and purpose.
SecondMuse Capital, a sister company of innovation firm SecondMuse, recently unveiled findings from the World YMCA Learning to Earning (L2E) Future Economy Lab (FEL), conducted in partnership with Generation Unlimited (GenU). The FEL explored high-potential financial mechanisms to support youth not in employment, education, or training (NEET).
The report highlights how innovative finance can improve employment outcomes for underserved youth aged 15-24.
Building on these insights, efforts in 2025 will focus on collaborating with investors to channel impact finance into programmes that accelerate youth employment in three key regions: India, South Africa, and Spain.
This initiative will cultivate young talent for a green and just transition, ensuring historically marginalised youth secure meaningful roles in the green economy. Impact finance will be instrumental in driving this mission.
The FEL engaged YMCAs and GenU sites across 12 countries through collaborative workshops, research, and interviews with investors and impact finance experts.
The goal was to identify how innovative finance can address systemic barriers to youth employment, including fragmented service delivery, short-term grant dependency, a shortage of quality jobs, skills mismatches, and insufficient employer involvement in training.
These challenges contribute to a global youth employment crisis – with one in five young people classified as NEET – and a skills shortage, as 87% of employers report current or anticipated gaps.
“We’ve seen firsthand how the current youth employment system isn’t working—especially for young people from underserved communities,” said Natalia Arjomand, Senior Director at SecondMuse Capital. “There’s so much talent and potential out there that’s being overlooked. Through the lens of innovative finance, we’re working to build the kinds of systems that help young people contribute meaningfully to their economies and communities.”
The L2E FEL identified six promising financial mechanisms:
- Youth Employment Impact Bond – A pay-for-success model where investors are repaid based on job placement and retention outcomes.
- Green Jobs Outcome Fund – A portfolio-based investment tool designed to bridge the green skills gap.
- Impact Linked Business Loan Fund – Flexible financing for youth-led or youth-employing businesses, with interest rates tied to social and environmental outcomes.
- Green Employment Income Share Agreement – Enables youth to access vocational training in green sectors, with investors repaid through trainees’ future income.
- Youth Aspirational Skill Loan Fund & TA Facility – A blended finance platform offering low-interest loans backed by philanthropic and government guarantees.
- YMCA Real Estate Fund – Leverages impact finance to develop YMCA properties into community-driven enterprises like vocational centers and affordable housing.
In South Africa, potential partners include SETAs, DHET, AmCham, and corporate entities, with vocational training centers (TVETs) playing a key role in implementation.
“We are at a tipping point in the youth employment system: it is failing the needs of young learners and employers,” said Caroline Chernov, Lead, Global Impact Investing at World YMCA.
“That is why YMCA has partnered with SecondMuse Capital to launch the FEL on L2E to bring new forms of sustainable finance into our efforts to guide more underserved young people beyond skills training and into meaningful work in labor markets worldwide. We will continue to explore opportunities to bring these types of mechanisms into our Learning to Earning efforts.”
Launched in 2020, the Future Economy Lab (FEL) pioneers inclusive economic development by designing financial solutions with – not just for – communities. To date, FEL initiatives have mobilized over $200 million in target assets under management (AUM), focusing on circularity, climate tech, education, health, and real estate. This latest effort underscores the commitment to fostering resilient, equitable economies where young people thrive.
