Verde Ventures Overview


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Overview of the Verde Ventures Fund

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Verde Ventures Overview

  1. 1. Verde Ventures Triple Bottom Line Investing Fund Overview
  2. 2. Mission of Conservation International Conservation International’s mission is to conserve the Earth’s Conservation International’s global biodiversity, and to living natural heritage, our mission is to conserve the societies are able to live demonstrate that human Earth’s living harmoniously with nature natural Conservation International’s mission is to conserve the Earth’s heritage—our global living natural heritage, our global biodiversity, and to biodiversity—and to demonstrate that human societies are able to live demonstrate that human harmoniously with nature societies are able to live harmoniously with nature
  3. 3. Conservation Funding Division Critical Ecosystem Partnership Fund Provides grants to civil society to enhance their capacity to conserve biodiversity Global Conservation Fund Provides grants for the establishment and long-term financing of protected areas Verde Ventures Provides loans for small and medium enterprises which contribute to conservation of biodiversity Global Marine Partnership Fund Fund in development to provide grants for marine protected areas Climate Community and Conservation Fund Fund in development to provide grants for carbon projects
  4. 4. Our Purpose Verde Ventures invests in small businesses that contribute to conservation and communities in Conservation International' global priority areas s
  5. 5. Why Verde Ventures? • Conservation-based employment is essential to provide economic incentives for conservation • The small business sector is a key partner in the intersection between human welfare and conservation • Lack of available, affordable capital to ensure the sustainability of the sector
  6. 6. Core Products Loans: US$30,000 to $500,000 (average: $125,000) Use of Loan funds: Infrastructure, working capital, trade finance Typical Deal Structure: Senior or subordinated secured debt for 3-5 years. Increasingly debt + quasi-equity. Strategic grants for technical assistance and environmental and socio-economic monitoring
  7. 7. Fund Overview Sectors Invested Regions Invested
  8. 8. Investment Map Mexico Peru Chile Ghana Indonesia El Salvador Bolivia Belize Ecuador Kenya Guatemala Costa Rica Mozambique
  9. 9. Triple Bottom Line Results Environmental Direct Hectares Impacted (within project area) 308,009 Indirect Hectares Impacted* 3,031,587 IUCN Red-listed Species Impacted 191 Financial Fund Costs Covered with Non Grant Revenue for FY08 85% Sales Generated by Businesses Supported $31,786,841 Leveraged Funding $3 million Social Total Direct Beneficiaries 15,125 Total Indirect Beneficiaries** 42,467 Percentage of Female Direct Beneficiaries (of total) 30% *Indirect includes area under the project’s influence, but not direct ownership control **Immediate family members of direct beneficiaries (direct beneficiaries are project employees)
  10. 10. Governance • Biodiversity Committee – Internal committee to CI – 3 permanent members and 1 regional staff – Meets about 3-6 times per year • Investment Committee – External committee – 7 permanent members – Meets quarterly
  11. 11. Invested Project Summaries
  12. 12. Rainforest Expeditions, Peru • Amount: $360,556 (2 loans) • Sector: Ecotourism • Use of funds: Lodge upgrade • Deal Structure: 2 loans secured against local collateral. Co-invested with 2 other lenders. • Impacts: 2 lodges directly protecting 2,500 hectares and providing direct income to 316 local, indigenous people
  13. 13. Ibo Island Mozambique Amount: $495,000 Sector: Tourism Use of funds: To renovate and expand its existing lodge in northern Mozambique Deal Structure: Invested and secured with collateral for 5 years. Impacts: Improved management of National Park (750,000 hectares) through ecotourism led job creation for 40 community members
  14. 14. Rolf Wittmer Turismo, Galapagos Amount: $250,000 Sector: Tourism Use of funds: To finance new certified boat and hire local fisherman as tour guides Deal Structure: Loans secured against local collateral Impacts: Benefit the local community by providing an employment alternative to unsustainable fishing in the Galapagos Islands
  15. 15. Coffee Investments $10.5 invested in 23 sustainable coffee suppliers (5 countries in Latin America and Asia) 100% trade finance secured on contracts (Starbucks etc.) 95% on-time repayment Directly benefiting 7,500 small farmers and more than 440,000 hectares of biodiversity-rich forest.
  16. 16. Monitoring • Financial: Business Performance Measurements • Environmental: Baseline survey + annual site- relevant indicators for measuring environmental change during the investment period • Social/Economic: Baseline household/community survey + annual indicators measuring change in socio-economic conditions of project beneficiaries
  17. 17. WH-LEEP World Heritage Local Ecological Entrepreneurship Program • New partnership with the United Nations Foundation, the United Nations Development Programme’s Small Grants Programme (SGP) • Blended capital approach to finance projects located in World Heritage Sites in 7 countries (Belize, Dominica, Kenya, Mexico, Philippines, Tanzania and Madagascar) • Focus on capacity building for community based enterprises • UNF financing the grant mechanism for capacity building and a 75% guarantee of VV invested loan capital
  18. 18. Risk Management • Thorough due diligence and oversight • Use of CI local networks in 40 countries • Invest with other lenders (also reduces costs) • Invest only in US$ and work with companies receiving hard currency revenues • Repayment terms of not more than 5 years. • At least 1:1 collateral secured under local law • Loan Loss Reserve Requirement averaging 10% of outstanding capital
  19. 19. Mainstreaming Biodiversity Financing • Recognition that scalability must occur with commercial banking and private equity sectors. • Supply: Financing incentives needed to encourage banks to lend to sustainable SMEs. • Demand: Maturation of specific sectors to become bankable- partially through help of boutique, blended (loan/grant) capital and technical assistance.
  20. 20. Key Lessons • Investment capital in the US$30,000 to $500,000 range can be effectively used to achieve conservation, social and financial returns. • Strategic use of grant funds with investment capital can greatly enhance project’s success. • Direct financial incentives (eg. interest rate reductions) should be used to further improve conservation returns on investment. • Triple-bottom line (environmental, social and financial) monitoring is crucial, yet expensive. • Guarantee funding is crucial for early stage SMEs in developing markets
  21. 21. The Road Ahead • Raise at least $10 million in loan capital within the next 5 years. • Raise at least $1.2 million in additional grant funding for capacity building and monitoring program. • Directly impacting 6 million hectares of key biodiversity landscape on 3 continents • Supporting business which employ 30,000 local people with few other opportunities • Demonstrating and replicating triple-bottom line success model (self-sufficient in 3 yrs) • Replicate Monitoring program
  22. 22. Thank You! For more information, please visit: