Initiative promotes business models that create economic solutions for sustainable development, generating income for producers, communities and indigenous peoples who keep the forest standing
Startups selected to participate in the Partnership Platform for the Amazon (PPA) Acceleration Program met in Manaus for a business round with impact investors, institutes and philanthropic foundations. The presentation of the pitches took place on 12/05 in Manaus.
A total of BRL 4.8 million was invested in 9 impact businesses, which operate in the areas of food production, energy generation, sustainable extraction, environmental education, river transport logistics and marketing platform: Na Floresta, Coex Carajás, Oka Sucos, Prátika Engenharia, Tucum Brasil, Academia Amazônia Ensina, NavegAM, Manioca and Onisafra.
The amount invested in business is four times greater than that invested in the business rounds promoted by PPA in 2018, which totaled BRL 1.1 million. The 2019 investors were SITAWI, USAID, Conexsus, Fundo Vale, Instituto Humanize, FIIMP, Grupo Rede Amazônica and Althelia Funds, almost all PPA members.
“The round totally exceeded our expectations. We were surprised by the stage of business development and how ready they are to receive investment and start an expansion process”, evaluates the PPA executive coordinator and director of new business at Idesam, Mariano Cenamo. “This round was a little different from the one we carried out last year, mainly because many businesses were still in the process of modeling the business and starting operations. With this new group, a major focus will be to develop strategies for measuring and communicating the impact of their business”, he evaluates.
Ted Gehr, director of USAID Brazil, points out that “in addition to the actual progress in the number of subscribers and the volume of investments from one year to the next, I was very impressed with the quality of the presentations. It was clear that they thought seriously about business plans, and the enthusiasm that everyone showed with their products and services and with the sustainable development of the Amazon [was evident]”.
Investors bet on a future that starts now
Before negotiations started, CEOs of companies that are members of the PPA and investors participated in a table on impact investments in the Amazon that highlighted the innovation and vanguard of these businesses in changing the key to economic development in the Amazon and the importance of having technical and financial mechanisms to foster this movement.
Denis Minev, CEO of Bemol and a member of the PPA, assesses that the Acceleration Program and the investment rounds are already showing results in a short time: “Many people talk about the bioeconomy theme, which is a very important topic in the Amazon as a but I see a lot of talk and few people creating things that will effectively improve living conditions in the region using the bioeconomy. And this PPA initiative is already showing that it is possible to build new companies, to mobilize good and profound entrepreneurs, scientists, entrepreneurs who really know the Amazon, to build this more prosperous future here”.
Márcia Côrtes, from the Instituto Humanize, also reinforces the potential of the bioeconomy in Brazil: “Instituto Humanize decided to participate in the PPA because it believes that this huge business potential is in the Amazon and needs investment and research to move forward. These entrepreneurs are pioneers in promoting business with purpose and positive impact. PPA was able to identify this network of entrepreneurs and sustainable businesses that already take place in the forest, and this is the future of the environmental issue. This tendency to have businesses that leave the forest standing, that restore, preserve with this intelligence to generate income and also generate prosperity for the people who live in the forest”.
One of the investors in the round, Fundo Vale, has been operating in the Amazon for ten years, supporting local development projects through philanthropy, and has been looking more closely at the expanding business ecosystem in the forest: “We learned throughout this process that it is not possible to transform if we do not offer new possibilities for the local economy, to shift mentalities. And we cannot achieve this solely with the traditional philanthropy model. We are now looking more at this impact business aspect, and this business round has exceeded our expectations. Today we support three businesses, but several others, when they gain maturity, volume of production and services, have great possibilities of connecting with work that the Vale Fund has been doing, including in the area of forest restoration and preservation. This is just the beginning. We have incredible potential ahead of us if we help these businesses to develop”, evaluates Márcia Soares, from Fundo Vale.
Investment with an impact
For impact businesses in the early stages, it is often difficult to find investors who work with lower value tickets, which makes it difficult for businesses in the early stages to access funding, which need smaller contributions to run. This is also an important contribution by PPA for these startups, as pointed out by Andrea Resende, director and responsible for the impact investment area at SITAWI.
“SITAWI has a history of partnership with PPA and other projects aimed at impacting investment and sustainable development in the Amazon. Supporting the development of new sustainable business models in the region is one of our priorities. PPA’s work, of bringing together different types of investors and capital to enable financing these businesses, is essential, because companies and businesses will only become big if they have the first, the second check. We are happy to further expand SITAWI’s participation in this new round, with technical support in the selection and evaluation of business and as the main investors”, she evaluates.
8 of the 15 startups selected for the PPA 2020 Acceleration Program participated in this year’s business round, in addition to two others that were part of the Program in 2019: Na Floresta, Coex Carajás, Oka Sucos, Tucum, Academia Amazônia Ensina, NavegAM, Nossa Fruits, Manioca and Onisafra. Investments in each business varied according to their needs and level of structure.
Other businesses selected for the 2020 Program competed for the Entrepreneur PPA Award, also presented during the business round, which awarded three of them with BRL 10,000 each: Ouro Verde Institute, Serras Guerreiras de Tapuruquara and Cacauway.
Artur Coimbra, owner of the company Na Floresta, received the biggest investment ticket of the business round. The main product is Na’kau chocolate, produced since 2017 with Amazonian cocoa purchased from riverine and agroextractive communities: “We have been through a lot of difficulties and losses to continue to exist. With this resource we will work and give back to everyone who supports us and do even more. We also need this PPA acceleration program so that we can listen to each other and receive help from other people to better deal with the business model, financial issues, numbers. Make us even more professional. The Amazon needs this, and our commitment is to serve the people who are here,” he says.
Another invested startup, NavegAM, seeks to solve an important bottleneck for the Amazon business itself: river transport logistics. “We left with more than twice what we asked investors. We will invest everything in developing solutions aimed at the Amazon, in search of solving the bottleneck that is, in addition to passenger transport and river freight, the difficulty of obtaining information.
About the Acceleration Program and the PPA
The Acceleration Program is led by a group of PPA companies, coordinated by Idesam and has strategic and financial support from USAID, CIAT, Instituto Humanize and Fundo Vale.
The Partnership Platform for the Amazon (PPA) is a collective action platform, led by the private sector, which seeks to build innovative, tangible and practical solutions for sustainable development, biodiversity conservation, forests and natural resources in the Amazon. It operates through four thematic groups (WGs): (1) Entrepreneurship, impact investing and accelerating sustainable business; (2) Strategic investment opportunities, based on tax incentives and the bioeconomy; (3) Strengthening Amazonian value chains and local sourcing; (4) Strengthening relations between communities and companies based on integrated territorial management and the Social and Environmental Uses of Private Reserves.
To learn more about the companies and organizations that are para of the Platform, click here.