Impact enterprises solving the most urgent social and environmental challenges through market-based models are important actors in the socio-development landscape. Geared towards the development of products and services that address the fundamental problems of poverty and sustainable development, they solve social problems by challenging traditions, combining creativity with intelligence.
In the Philippines, social enterprises serving the poor are often pioneers, facing challenges and risks referred to as the “pioneer gap.” These challenges include difficulties in the operating environment, finding resources and raising capital, and growing their business with few investors willing to finance to absorb the risks involved in pioneering new business models. As a result, many of these enterprises fail because of lack of support, not just financial but also mentorship, to enable them to make it to a later stage. Impact investing targets to bridge these gaps.
With the mission to leapfrog the impact entrepreneurial ecosystem in the Philippines, social enterprise incubator xchange has partnered with India’s Villgro. Villgro and xchange have combined decades of experience in investing in impact entrepreneurs to address gaps in the Philippine ecosystem. Villgro is India’s oldest and one of the world’s largest social enterprise incubators. xchange is an incubator in the Philippines that invests in early-stage social enterprises while providing tailored mentorship and support to help them achieve scale. Together, they designed and developed the Impact Pioneer model that would encourage collaboration with other individuals and organizations or “impact pioneers” who believe that entrepreneurship is a key tool in solving social and environmental challenges.
In its first year, the network will focus on building resilience during the pandemic economy by providing a variety of investments including zero-interest loans and quasi-equity through a Resilience Fund, as well as six months of tailored support to build resilience and to adapt their models for a recession year. It is also expected to launch new services for enterprises and impact pioneers, while continuing to grow the network of individuals and institutions and engage the larger ecosystem.
The network’s priority sectors are agriculture and fisheries, climate crisis, education and employment, and affordable healthcare. It will adopt a gender lens in all aspects of its operations and will actively source enterprises which impact the lives of women and girls.
You can learn more about the Impact Pioneers Network here. Also check out this guide on angel investing by infoDev.
Investing in women makes smart economics and – in the COVID-19 scenario – will be essential for economic turnaround during the post-pandemic recovery.
Yet, many women remain marginalized. Businesses owned and led by women account for a large untapped source of job creation and economic growth in developing countries, including the Philippines. Women-owned or led social enterprises (WSEs) encounter significantly more barriers to growth than their male counterparts, including less access to capital to expand their enterprises.
To address the financing gap, Investing in Women (IW), an initiative of the Australian Government, has partnered with the Foundation for a Sustainable Society, Inc. (FSSI). Programmatically active for 10 years, the project involves an investment capital from IW and FSSI of at least Php 80 Million (AUD 2.5 Million) to support the business growth of WSEs.
Supporting Women Owned/Led Social Enterprises
The IW-FSSI Project will support the development and scaling up of 12 WSEs. These enterprises are those with clear and viable business expansion plans, and a commitment to consistently improve their triple bottom line targets of People, Planet, and Profit and drivers of growth for their respective social enterprises. The project will provide the following support:
· Investment capital of between Php7M to Php16M per WSE through either debt financing, equity or mezzanine financing, joint venture or any combination of these
· Promotion of gender lens investing (GLI) through tapping additional investors
· Reviewing and/or drawing up business strategic plans
· Making available updated trends and information about the industry, market, technology, finance, and sales
· Providing training and mentoring (on financial management, marketing and sales, quality control, HR development, change management, and business continuity planning)
· Support for the adoption of appropriate industry/business innovations
· Appropriate environmental management plans
· Gender planning
Established in 1995 through a debt for development swap between the governments of the Philippines and Switzerland, FSSI seeks to apply innovative financing and capacity building support that will maximize both social and financial returns through valuable entrepreneurship, at the same time ensuring equitable development and environmental sustainability in all its initiatives. Since 1995, it has supported over 200 sustainable development projects in marginalized communities.
“We are grateful for our partnership with IW and we look forward to working with women-owned and women-led social enterprises (WSEs), especially at this challenging time when the pandemic is affecting many WSEs,” said FSSI Executive Director Sixto Donato C. Macasaet.
The IW-FSSI project will tap the expertise and networks of FSSI’s consortium partners, the National Confederation of Cooperatives (NATCCO) and the Philippine Business for Social Progress (PBSP), in delivering the needed capacity building and mentoring requirements.
The following are the criteria for women social enterprises to become partners of FSSI’s Investing in Women (IW) Project:
For more information or inquiries about the IW Project, contact:
Partnership Manager, FSSI
IW Project Officer, FSSI
Visit Investing in Women for more details.
There seems to be no clear end in sight yet to the coronavirus pandemic. The government has put a name on the “new normal”— the general community quarantine (GCQ) involves more relaxed measures compared to the enhanced community quarantine (ECQ) that is still in place in Metro Manila and other high-risk areas. Businesses now have to adapt to the long-haul reality that COVID-19 brought upon us.
Fortunately for the local coffee industry, a social enterprise (SE) invested in changing the mindset and empowering coffee farmers to process and roast their own coffee. Now their investment is paying off, as some farmer cooperatives and groups continue to operate and sell their products in their own localities, keeping their livelihood despite the disruption in the supply chain caused by the lockdowns.
Empowering local coffee farmers as agro-entrepreneurs
According to Vie Reyes, co-founder of Bote Central Inc., the lockdown has affected the supply of raw coffee beans from Mindanao, Visayas, and Cordillera to processors in Manila, illustrating the plight of many farmers who are unable to sell their produce to the market. Now, more than ever, farmers are realizing how important it is to have their own coffee processing. “Swerte ‘yung mga magkakape na may mga sariling processing, na may roasting machines, kasi nabubuhay sila. In fact, nakakapagnegosyo pa rin sila ng kape dun sa communities nila, sa areas nila,” Reyes shares.
Bote Central Inc., a partner of the Foundation for a Sustainable Society, Inc. (FSSI), is a social enterprise that promotes the sustainability of the Philippine coffee industry through rationalizing the supply chain and embedding Fair Trade principles in their business. Bote Central empowers farmers to be more than suppliers, and enables them to move up the value chain as small-scale processors.
The enterprise was able to drive local economic development through technology. Bote Central designs and builds their own coffee roasting machines, which they share with their partner coffee farming communities across the country. Their roasting machines, suitable for smallholder farmers, made it possible for these farmers to economically process and sell their own coffee, paving the way for community-based coffee roasting business facilities. In that way, farming communities can add value to their raw coffee beans and create sources of income for their families.
In the end, Bote Central’s intervention is not only in providing these machines at a reasonable price to local small farmers, but in opening up opportunities, ones that used to belong only to bigger players in the industry.
Grounded in market reality over promise of false hopes
Besides taking ownership of their role in the coffee value chain, Bote Central also imparts to farmers the value of speaking their minds. “‘Yun ang ginawa namin na change as an SE, na baguhin ‘yung values or ‘yung confidence, ‘yung mentalidad ng farmers,” Reyes shares. Bote Central, however, understands that this is only one side of the equation.
“If you talk to the farmers, balewala na sabihin mo sa kanila na magtanim kasi maganda ang presyo…
Ang dami-dami mong pwedeng sabihin sa farmers, pero we call them the false promises. Kasi you’re just giving them false hopes.
Dapat konektado ang lahat ng binibigay mong promise or hope sa market.”
When Bote Central entered the world of coffee, it was not only the farmers that they saw needed to be changed, but the market itself. “Both the farmers and the market concerns in-address namin. Kasi ‘di pwedeng production lang. Kailangan may kasabay siya na consumption. ‘Yung promises dapat may kabangga on the other end of the value chain. You cannot just promise the farmers na they will have gold at the end of their rainbow.”
Bote Central imparts that the farmer himself and the communities where the farmers reside are part of the market. Reyes emphasized that, in fact, that is the primary market that the farmers should focus on. “Mismong sa bahay nila umiinom sila ng kape. ‘Yung kapitbahay ni farmer, umiinom ng kape, ‘yung barangay, umiinom ng kape,” she explains. This is the very same market which currently operating businesses take advantage during this lockdown, given limitations on travel and mobility.
Besides the sale of roasting machines which unfortunately has temporarily stopped, Bote Central is also engaged in the sale of coffee sourced directly from their partner farming communities. They have developed brands to cater to different market segments, but they still only move within 10 to 15 percent of the market, which they try to expand. “Consumption of coffee in the Philippines is 85 to 90 percent commodity coffee. As an SE, if you want to really make an impact sa economy natin, sa market natin, sa farmers natin, dun ka gagalaw,” Reyes shares.
Their business philosophy
Reyes is thankful that although it is not a basic necessity like rice or meat or vegetables, coffee is part of the food mentality of Filipinos. They were also lucky to stock up on a full inventory of coffee beans before COVID-19 hit. Their Basilio brand is still available in supermarkets, and they are also pleasantly surprised with the number of online orders they receive during the ECQ. It helped that they have set up online ordering prior to COVID-19 and are ramping up online sales. However, she admits that it is nothing compared to corporate accounts, institutional accounts, and monthly orders which make up most of their revenue and are currently suspended due to the ECQ.
Raw coffee beans are also waiting to be transported from their source communities. “Ang essence talaga ng survival ngayon is move the beans. When we say “move the beans,” it’s literally moving and selling,” she says.
Under ECQ, Bote Central is operating at 20% production. Only select employees are also qualified to move around, following government policies. As with other businesses, their plans this year were also pushed back. However, in the midst of these concerns, Bote Central sees several windows of opportunities. For now, that opportunity is working with the Office of Vice President Leni Robredo and other volunteers in providing free coffee for front liners. “We made it into an opportunity kasi lahat naman ng business opportunities come from a problem. Ganun kami mag-isip. Ganun rin yung binibigay namin na value sa mga farmer. Kung may problema, pag-usapan natin, at tingnan natin kung merong solusyon.”
Besides the significant decrease in production and income, they also experience a higher cost of moving their products around. In terms of needed support from the government and other organizations, the enterprise considers loans and grant facilities important to help them weather this crisis; relaxed loan settlements and tax relief will also be of great help.
FSSI has provided its partners a 60-day extension on due dates of their loan amortization and is discussing additional flexibility terms as needed to help partners cope with the effects of COVID-19 on their operations.
Bote Central’s “after-COVID” plan is already in the pipeline. They will be putting up more coffee roasting facilities in partnership or joint venture with other SEs, businesses, or individuals who share the same business endeavor.
In the meantime, Bote Central is shipping its coffee products nationwide in a limited capacity. In these extraordinary and trying times, let a good ol’ cup of a hundred percent locally made, sustainably sourced coffee brighten your day.
Their Basilio and Alamid coffee are available for deliveries. You may place your orders online through https://botecentral.com/. You may also follow Bote Central and Basilio: Coffee to Share on Facebook.
ONE PH’s “Tayo-Tayo” featured FSSI Executive Director Mr. Sixto Donato C. Macasaet and LiveGreen President and CEO, Mr. Paris Uy during the teleradyo’s episode about sustainable communities on July 20, 2019.
Hosted by environmental lawyers Atty. Niner Guiao and Atty. Aya de Leon, the whole interview can be viewed at
On May 29, 2019, the Foundation for a Sustainable Society Inc. (FSSI) and its members and partners gathered in Quezon City for the Foundation’s 30th General Assembly, with the theme “Braving Challenges, Sustaining Enterprises.”
The morning session was filled with insightful discussion as resource speakers Ms. Rosalina Dulabay of the Malabog Integrated Enterprises Development Cooperative (MIEDECO) of Davao City, Mr. Freddie Langpaoen of the Self-Reliant Team of La Trinidad Cooperative (SRT Co-op) of Benguet, and Ms. Christie Rowena Plantilla of the Federation of Peoples’ Sustainable Development Cooperative (FPSDC) shared their organization’s experiences and lessons learned in overcoming challenges, as well as using these challenges as opportunities for innovation.
“We cannot do away with organizational problems or challenges as these are necessary ingredients of success,” shared Langpaoen as he recalled how their first few years were the most challenging. “So if you are faced with such, do not easily give up, hold on, and stand your ground,” he said.
FSSI Executive Director Sixto Donato C. Macasaet noted that the beginnings of the three cooperatives may be different, but they all performed similar strategies to sustain their enterprises. He summed these up as 1) Shared ownership, 2) Strong leadership, 3) Service that bring satisfaction to members and customers, and 4) Strong support network.
During the afternoon session, FSSI Board Chairperson Norman Joseph Jiao, Treasurer Sylvia Paraguya and the chairpersons of FSSI committees gave updates and reports on the Foundation’s accomplishments for 2018. FSSI subsidiaries Pilipinas Ecofiber Corporation (PEC) and Cocobind, Inc. also reported their performance in the past year.
“We have weathered a challenging year and we look forward to a brighter future,” said Jiao. “This year, we will be evaluating our 2017-2019 MTDP and draft our new strategic plan. We hope that the challenges we braved in 2018 and the reforms we have instituted will bring us to the achievement of our mission of providing social investments to vulnerable communities to achieve sustainable development,” he added.
The afternoon Business Session was followed by the election of new members of the Board of Trustees and of the Good Governance Committee (GGC). The Philippine Business for Social Progress (PBSP), Mindanao Coalition of Development NGO Networks (MINCODE), and National Council of Churches in the Philippines (NCCP) join the Association of Foundations (AF), Federation of People’s Sustainable Development Cooperative (FPSDC), National Confederation of Cooperatives (NATCCO), and Philippine Cooperative Central Fund Federation (PCF) as new members of the Board. Meanwhile, Mindanao Alliance of Self-Help Society, Inc. – Southern Philippines Educational Center for Cooperatives (MASS-SPECC) and National Secretariat for Social Action (NASSA) were elected as new members of the GGC.
The Assembly also expressed its gratitude to Ms. June Rodriguez of CONVERGENCE, Ms. Agnes Bolanos of MINCODE, and Mr. Lauro Millan of NCCP, who completed their term as Board members.
The following are the officers and members comprising the new Board of Trustees:
Chairperson: Norman Joseph Jiao (Representing AF)
Vice Chairperson: Lauro Millan (Representing NCCP)
Corporate Secretary: Christie Rowena Plantilla (Representing FPSDC)
Treasurer: Sylvia Paraguya (Representing NATCCO)
Auditor: Betta Socorro Salera (Representing PCF)
Member: Agnes Bolanos (Representing MINCODE)
Member: Reynaldo Antonio Laguda (Representing PBSP)
Pictures of the General Assembly are available at https://www.facebook.com/pg/FSSI.Philippines/photos/?tab=album&album_id=2339955436050114