Dr Andy Hall (CSIRO) presented at Roundtable on Inclusive Agribusiness in Southeast Asia in Ho Chi Minh City in Sept 2015 on a number of distinctive innovation pathways and models for agribusiness (ranging from SME to Multinational) to become more inclusive
I'm excited about the prospects of using private financial capital to fund impactful initiatives in areas that would in most cases be to risky. This can be done by seeing the high-risk areas a place for R & D, CSR, or a way to mitigate reputational risk. The problem is its complex.
There are a couple examples here about trying to make this vision a bit simpler to understand without lying through simplistic propositions.
[HR601] 006. Introduction of Innovation & EntrepreneurshipAriantoMuditomo
Copyright Notice:
This presentation is prepared by Author for Perbanas Institute as a part of Author Lecture Series. It is to be used for educational and non-commercial purposes only and is not to be changed, altered, or used for any commercial endeavor without the express written permission from Author and/or Perbanas Institute. Appropriate legal action may be taken against any person, organization, or entity attempting to misrepresent, charge, or profit from the educational materials contained here.
Authors are allowed to use their own articles without seeking permission from any person, organization, or entity.
Dr Andy Hall (CSIRO) presented at Roundtable on Inclusive Agribusiness in Southeast Asia in Ho Chi Minh City in Sept 2015 on a number of distinctive innovation pathways and models for agribusiness (ranging from SME to Multinational) to become more inclusive
I'm excited about the prospects of using private financial capital to fund impactful initiatives in areas that would in most cases be to risky. This can be done by seeing the high-risk areas a place for R & D, CSR, or a way to mitigate reputational risk. The problem is its complex.
There are a couple examples here about trying to make this vision a bit simpler to understand without lying through simplistic propositions.
[HR601] 006. Introduction of Innovation & EntrepreneurshipAriantoMuditomo
Copyright Notice:
This presentation is prepared by Author for Perbanas Institute as a part of Author Lecture Series. It is to be used for educational and non-commercial purposes only and is not to be changed, altered, or used for any commercial endeavor without the express written permission from Author and/or Perbanas Institute. Appropriate legal action may be taken against any person, organization, or entity attempting to misrepresent, charge, or profit from the educational materials contained here.
Authors are allowed to use their own articles without seeking permission from any person, organization, or entity.
This class will cover some of the key considerations social entrepreneurs face when launching and growing their social enterprise. Emphasis will be placed on marketing social enterprises where students will be provided an overview of theories around cause marketing and sustainable marketing. Operational, human and legal considerations are also reviewed which include understanding various legal forms applicable to social businesses. Students will also engage in basic financial analysis for their enterprise to determine the financial feasibility of their proposed solution.
Presentation by Diego Useche, Associated Professor at the University of Rennes 1 (France), at the FogGuru training Business Modeling and Development in November 2019.
As access to finance is one of the key challenges these startups face in the early stage, it is important to select financing instruments that match an enterprise’s business model, needs, and the stage of development that the firm finds itself into, in order to help ensure the impact enterprise success and foster its development.
Supporting SMEs and the inclusive agribusiness innovation system in Southeast...Food_Systems_Innovation
On 7 March 2016, CSIRO and Palladium presented the key findings and opportunities identified through their their recent studies into inclusive agribusiness innovation patterns and trends and impact investing in inclusive agribusiness in southeast asia at DFAT canberra office. In particular, they talked about the need/opportunity to support the inclusive agribusiness innovation system through mechanisms such as an innovation support facility.
ODA for Capacity Building in the Social Enterprise- and the SME-Sector in IndiaMartin Vogelsang PhD
Based on my long-standing experience as impact investor in India I would like to suggest that Official Development Assistance (ODA) coming into the country is disbursed more strongly towards capacity building (training, education) and supporting the incubation of viable social enterprises and inclusive businesses catering to the “Base-of-the-Pyramid”. Investing into this area of the Indian economy would not only help alleviate to poverty and at least partly solve some of the grave environmental problems the country is facing. Such an initiative could also help India’s corporate sector become more engaged in creating and scaling innovative solutions in the areas of technology or financial services that could open up new markets for them.
This class will cover some of the key considerations social entrepreneurs face when launching and growing their social enterprise. Emphasis will be placed on marketing social enterprises where students will be provided an overview of theories around cause marketing and sustainable marketing. Operational, human and legal considerations are also reviewed which include understanding various legal forms applicable to social businesses. Students will also engage in basic financial analysis for their enterprise to determine the financial feasibility of their proposed solution.
Presentation by Diego Useche, Associated Professor at the University of Rennes 1 (France), at the FogGuru training Business Modeling and Development in November 2019.
As access to finance is one of the key challenges these startups face in the early stage, it is important to select financing instruments that match an enterprise’s business model, needs, and the stage of development that the firm finds itself into, in order to help ensure the impact enterprise success and foster its development.
Supporting SMEs and the inclusive agribusiness innovation system in Southeast...Food_Systems_Innovation
On 7 March 2016, CSIRO and Palladium presented the key findings and opportunities identified through their their recent studies into inclusive agribusiness innovation patterns and trends and impact investing in inclusive agribusiness in southeast asia at DFAT canberra office. In particular, they talked about the need/opportunity to support the inclusive agribusiness innovation system through mechanisms such as an innovation support facility.
ODA for Capacity Building in the Social Enterprise- and the SME-Sector in IndiaMartin Vogelsang PhD
Based on my long-standing experience as impact investor in India I would like to suggest that Official Development Assistance (ODA) coming into the country is disbursed more strongly towards capacity building (training, education) and supporting the incubation of viable social enterprises and inclusive businesses catering to the “Base-of-the-Pyramid”. Investing into this area of the Indian economy would not only help alleviate to poverty and at least partly solve some of the grave environmental problems the country is facing. Such an initiative could also help India’s corporate sector become more engaged in creating and scaling innovative solutions in the areas of technology or financial services that could open up new markets for them.
Guidelines on greening agri business -relatiuonships-interfirm cooperationPRIVATE CONSULTANCY FIRM
Value Chain Analysis for Sustainable Rural Development
by: Ivan Idrovo and Marian Boquiren.
Contracted by: GIZ-Department of Agriculture-NCI-Philippines
The Essential Handbook For Raising Capital Part II: How To Approach An InvestorSankalp Forum
Now that you are armed with the all the salient details about your business that investors look for, you are ready to meet investors. This presentation presents as 4-step process on how to do so, explains impact investment for socially relevant businesses, and assessment in the pre due-diligence stage. It delves into how investors analyze your business model, market research, financial attractiveness and scalability.
Presented by leading social advisory firm Intellecap, this slide deck was prepared for Sankalp Forum. The Forum is an enabler of socially oriented early-stage businesses, and catalyzes investments, mentors and international networks to do so.
Read more about Sankalp at www.sankalpforum.com
Entrepreneurial and innovation for SMEs in LibyaOECDglobal
Dr. Dia Eddin Sadek Abuhadra, Advisor to Libya Enterprise, 11 May 2016, Regional conference: Investment and inclusive growth in the midst of crisis, Beirut
Good Measures: The Case for Quantification in Impact InvestmentPabloVerra
The impact investment sector has duly recognized that impact measurement is central to legitimizing the practice of impact investing. Increasingly, investors want to have more detailed social and environmental performance data so they can scrutinize it as they do with financial data. This enables investors to have a better understanding of social returns on investment and re-allocate investment capital accordingly.
Similar to Impact investment into inclusive agribusiness (20)
Scaling inclusive agri food markets: The 10% or the 90% ?Seas of Change
Presentation by Bill Vorley of the International Institute for Environment and Development, during the Seas of Change Conference in The Hague, april 2012.
At Taste Of Middle East, we believe that food is not just about satisfying hunger, it's about experiencing different cultures and traditions. Our restaurant concept is based on selecting famous dishes from Iran, Turkey, Afghanistan, and other Arabic countries to give our customers an authentic taste of the Middle East
Ang Chong Yi Navigating Singaporean Flavors: A Journey from Cultural Heritage...Ang Chong Yi
In the heart of Singapore, where tradition meets modernity, He embarks on a culinary adventure that transcends borders. His mission? Ang Chong Yi Exploring the Cultural Heritage and Identity in Singaporean Cuisine. To explore the rich tapestry of flavours that define Singaporean cuisine while embracing innovative plant-based approaches. Join us as we follow his footsteps through bustling markets, hidden hawker stalls, and vibrant street corners.
Roti Bank Hyderabad: A Beacon of Hope and NourishmentRoti Bank
One of the top cities of India, Hyderabad is the capital of Telangana and home to some of the biggest companies. But the other aspect of the city is a huge chunk of population that is even deprived of the food and shelter. There are many people in Hyderabad that are not having access to
Focused on Indonesia, Myanmar, Philippines and Vietnam
Review of available literature and one-week in each country
1. Agri-businesses that benefit poor people as suppliers and workers
Farming cooperatives with ‘poor’ members
Vertically integrated processor and exporter
MNC that has invested in its supply chain to the benefit of their suppliers/workers
2. Agri-business that target and impact the ‘poor’ as consumers
Poor benefit as consumers of quality agricultural inputs (seeds, fertiliser, and irrigation equipment)
Services (information, farmer education, financial, or pest control services)
Businesses in the domestic food/beverage retail sector that create demand for the ‘poor’s’ produce
Sources of finance, deal size, instruments used, return expectations, terms etc.
Investors do not invest below a deal size of $250k
Smaller deals have been done but…
Congregate at middle of the risk-reward spectrum…
There is some private, public and international donor capital at the seed- and venture-stage but it is thin and ad hoc.
At least 2-3 years trading history
A healthy balance sheet
Those excluded or marginalised from domestic formal financial services
Professional founders/managers with sectorial experience
Commercial or near-commercial returns
Potential for existing social impact to scale
Some evidence that this is taking place through opportunistic angel investment and funding of business accelerators and incubators
More flexible in their approach, more able to take risks, and less driven for short to mid-term returns.
Impact capital has been invested in agri-business and levels of investment are likely to increase in years to come
and thus, ultimately its potential for social impact
If there is no shortage of impact capital, why isn’t it finding its way to more inclusive agri-businesses?
Typically investors are looking commercial or near-commercial rates of return. Typically, IRRs of 15-20%.
However, investing in businesses that are beyond the risk profile of the domestic financial service sector, pushes investors towards businesses that are too small in trading revenue, too marginal in profitability or too informal in operations to deliver IRRs of 15% or more
Many impact investors are remunerated through a fixed fee calculated as a proportion of AUM.
Creates incentive to accumulate and manage more assets.
This, coupled with the fact that transaction costs vary little between different deal sizes + tendency towards a ‘light touch’ staffing in country, creates upwards pressure on deal size, towards growth stage companies.
2 implications:
Large proportion of agri-businesses ruled out for investment
If early-stage businesses are not getting investment, where tomorrow’s growth-stage businesses going to come from?
Constraints found in the SFs and ‘rules’ of the system that inform, support and shape interactions…
Where SFs and/or rules are underperforming, or are absent altogether, this maybe contributing to the problem in the core of the market: a limited pool of ‘investable’ agri-businesses.
Deal sourcing
Search tactics appeared to be a common shortcoming across fund managers
Majority rely on personal connections among the professional urban elite, in addition to competitions and trade fairs
If investor staff are not nationals, or don’t speak the local language, the circle tightens yet further
Identified a number of positive tactics… but these tended to be outliers.
The point - It may be that limited search tactics tactics - and weak deal sourcing infrastructure - hides from view some businesses that are investable, or near investable
Investor community marketing
Investors are looking for investees with similar characteristics. However, investor community collaboration in marketing is largely absent at the moment.
Agribusinesses are not widely aware of impact investor financing…
Perhaps scope for joint action with respect to investor community marketing, service awareness-raising, and local language press coverage.
Greater awareness and understanding might serve to expand the pool and visibility of ‘investable’ agri-businesses for/to investors.
Social enterprise
To take a country-specific example. In Indonesia, there is no legal status for social enterprise, though a number of organisations are advocating for this.
Most ‘social enterprises’ are registering (if at all) as a limited company (PT). Cooperatives, foundations (Yayasan), and organisations (Perkumpulan) are also formal statuses, but neither of these, nor the PTs, allow for the conditions that socially purposeful enterprises and impact investors ideally require - i.e. to make profit, to pursue and secure certain types of investment/financing, and to ‘reward’ positive social outcomes with ‘breaks’ of some kind.
A legal status for ‘social enterprise’ would raise the profile of socially-orientated businesses generally as well as provide a ‘formal’ platform for socially-orientated start-ups (perhaps leading to more) in addition to those already generating socially positive outcomes. The effect could be amplified if certain incentives, credits or exceptions were related to this new status.
Not just about the finance and the ‘investment’ environment, it is about the broader environment in which these agri-businesses have to operate
We know that agri-businesses struggle internalise responses to the myriad of external market constraints that impede growth. The scale, range and complexity of market failure in which early-stage businesses operate is such that the odds are stacked against any one firm attempting to address and overcome these failures, to grow, and become ‘investable’.
Question becomes: how is the market failing early-stage agri-businesses?
Again, the answer lies in the system – the SFs and rules – that surround early-stage agri-businesses. Where SFs and/or rules are underperforming, or are absent entirely, this may prohibiting early-stage agri-businesses from getting to an investment ready position, and thus limit the pool of investable businesses.
Professional services
Numerous professional business services of all types are in short supply.
Financial advisers catered towards the MSME market are one such gap: financial management advice, accounting and book keeping services, and investment brokering could all support less formal, less structured agri-businesses that would otherwise qualify to appeal to investors.
Business service offerings in support of licencing and negotiating regulations relevant to market access would be advantageous also – for example, those related to exporting produce and processed products, food quality standards compliance, organic and tractability certification – helping early-stage companies to build a platform for high-value overseas distribution relationships sought by many investors.
In the absence of such guidance, mentorship and/or reduced fee services, viable and prospectively attractive venture-stage agri-businesses will remain too expensive in terms of transaction costs.
Processing equipment
A pull on agricultural produce and an incentive for farmers to make productivity improving investments is the presence of agri-processors and the growth of the food and beverage segment.
The growth of early-stage food and drink processors is limited by the availability of affordable machinery and equipment.
Improvements in equipment leasing and the expansion of offers from equipment manufacturers and distributors could have a significant impact on the prospects of agri-processor growth.
Open data
The development of agricultural information service ‘products’ and service ‘offerings’ in the private sector can be bolstered greatly by the free availability of raw, semi-processed, or organised data pertaining to agriculture and agribusiness held in public offices and departments.
For example, weather, soil and disease incidence data, hold commercial value and many encourage the development of products and services, the expansion of companies in response to market gaps/needs etc.
At times, public offices may seek remuneration for data that, in the right hands, could support more pro-poor products and services. At other times offices are unaware that they are sitting on valuable information.
Businesses cannot access credit or other investment, so subsidised finance is provided
Entrepreneurs needs early stage incubation, so subsidise incubation facilities are provided
There’s a gap in deal sourcing mechanisms so match-making services are provided
When donors fund or perform these functions themselves they may achieve short-term results but are effectively, circumventing and potentially undermining the systems they are trying to strengthen. Moreover, plugging gaps directly, is neither scalable nor – given the temporary, project-based nature of donor funding – sustainable.