The path of co-creation, using validated tools and methodologies, allows the generation of comprehensive projects that attack complex problems and provide systemic solutions appropriate to each reality.
Little did Benjamin know that finishing his thesis would fulfill the dream he had promised his grandfather. He is Mayan from the Guatemalan southwest, rooted in the land and committed to his people. After several years of study and many analyses, tests, and verification in the field, he came up with a much-awaited formula.
His dream was to return to his land, which his grandfather had never left, so he could contribute what he had learned as an agronomist. He had told his grandfather: “You will see. We are going to produce more quality and greater quantity right here, perserving our land and our culture.” He had not yet founded Flor de Tierra, but he was already filling a few bags with enriched soil based on the formulas he had presented in his thesis. The main ingredient in the sachets was hope.
Benjamin is one of many who have companies with a social purpose, created from business opportunities, research, and people’s needs. Benjamin wants to continue growing; for this, he may need to access funding.
The Central American Region
Meanwhile, in different country in Central America, another idea, a purpose, emerged out of a need. After a co-creation process, the Regional Center for the Promotion of MSMEs (CENPROMYPE in Spanish) and VIVA Idea shaped a program that will help link investors and other capital providers with those from the field who need investment to scale their business.
The situation in Belize, Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, and the Dominican Republic (the countries that are part of the Central American Integration System — SICA) is currently complex. High unemployment rates, growing social inequality, and informality exceeding 50% in several of the region’s countries are part of the growing difficulties. Micro, small, and medium enterprises (MSMEs) make up about 97% of businesses.
CENPROMYPE, SICA’s regional entity in charge of strengthening the MSMEs’ ecosystems, has a Regional Policy for Modernization and Transformation of MSMEs in the SICA countries (2022-2050), and implementing it is its primary objective.
“CONSOLIDAR” Program
CENPROMYPE’s aim was to respond to the needs of MSMEs that had the urgency of consolidating and going to scale; to generate a solution using a participatory approach on the ground, yielding a contextualized program, appropriate to the region, to achieve the link between MSMEs and capital providers.
David Cabrera, Executive Director of CENPROMYPE, recalled, “we needed a project that could put Central American beneficiaries on the map for international investors. We were looking to design and implement a comprehensive and different project for MSMEs in the SICA region, and VIVA Idea supported and advised us so that we could create a complete program that includes links with capital providers, an investment fund for MSMEs, a work platform, and a certification brand, all under the same institutional umbrella”.
CO-CREATION IS THE MECHANISM THAT ENSURES THAT DIFFERENT VISIONS
Urs Jäger, Executive Director of VIVA Idea
OF THE SAME PROBLEM BE ON THE TABLE AND THAT THE SOLUTIONS WE CREATE ARE THE PRODUCT OF A STRATEGIC ALIGNMENT, OF JOINT WORK BY THOSE WHO UNDERSTAND THE CONTEXT AND WANT TO ACT ON IT IN THE SAME SENSE”
Methodologies and Tools
The Regional Center found in VIVA Idea a strategic partner that provided knowledge, co-creation methodologies, and systematization of a process to build a robust proposal adapted to the Central American context.
VIVA Idea’s “action research” methodology would be underlying the project. Research generates impact, and impact allows for more [better] knowledge creation, that is translated into tools that in turn support impact, generating a virtuous cycle.
The project was framed around the concept of impact investing. Impact investments are investments made in companies, organizations, and funds to generate social and environmental impact as well as financial return.
Paola Fonseca, VIVA Idea’s Director of Impact, stated that “the construction of a comprehensive project is not a one-day task; it is a process. It seeks to create trust, mutual understanding, and alignment of objectives, and requires deep knowledge of the context”. “Co-creation is the mechanism that ensures that different visions of the same problem be on the table and that the solutions we create are the product of a strategic alignment, of joint work by those who understand the context and want to act on the problem” explained Urs Jäger, Executive Director of VIVA Idea, who led that first moment of creation of the project even before it had a name.
“As a regional entity linked to the Central American Integration System (SICA) that works with the governments of the region’s countries, we have already been working in these matters. Now, within the framework of the Program that we have been formulating, we will continue with that effort, with clear objectives, and aligned with our MSME Regional Policy”, explained the director of CENPROMYPE.
Existing tools from both organizations will be used to create the Consolidar Program. Social progress measurement tools, acceleration methodologies, beneficiary analysis to generate investment portfolios, and stakeholder alignment tools in complex environments were all tested in previous projects and created from action research processes endorsed by the international scientific community.
Impact Investing
The Consolidar Program brings together a mapping and integration of stakeholders, a capital fund, a training and acceleration platform, and a certification to identify the participating MSMEs. This structure will enable the execution of CENPROMYPE’s regional MSME strategy, promoting exchanges between those who need financing and training and those who want to diversify their impact investments, and creating possibilities for social progress for the region.
The main objective is the social progress of the region and the improvement of its inhabitants’ quality of life through the market’s potential to generate and distribute wealth.
Impact investing is increasingly seen as the heart of the investing world and the marketplace. “If the market has an invisible hand, impact investing is its heart,” as Sir Ronald Cohen, Chairman of the Global Steering Group for Impact Investment (GSG), puts it.
In this sense, the Consolidar Program has multiple objectives towards sustainability in the region and seeks to be a bridge between investors and companies that generate impact. These companies, which will have received training, acceleration, and preparation, may have a certification seal through the Consolidar brand that will give confidence and security to the investor who seeks to invest with triple impact, generating financial, social, and environmental returns.
Benjamin is possibly thinking, why isn’t there a platform in Central America where he can access capital providers that have that positive impact as a priority?
Investing in a company installed in a society that also needs to improve is an investment that will have a more significant impact. As the founder of VIVA Idea, Stephan Schmidheiny, says, “there are no successful companies in failed societies,” and Consolidar knows that the investment must be made in a way that benefits the beneficiary company and its surroundings.
You are invited to be part of this initiative and encourage impact investing through the consolidation of MSMEs in Central America and the Dominican Republic.
