How to make an impact?
By Ai-Lin
Our client was very happy about what we have done, and I feel grateful and accomplished because our idea may somehow help his organization to create more impact, including saving more energy, containing costs for farmers, and boost their economic status while protecting the environment.
It has been more than one year since the COVID-19 breakout. Spending most of the time indoor didn’t restrain me from learning in the “field seminar”, which were meant to be an on-site trip to visit local farmers to have more immersive experiences. During the last lecture, we received lots of positive feedback and supportive information from the class after presenting our findings for wrapping up our final report. Moreover, through the presentation of other teams, I had a chance to learn from my talented classmates on how they dealt with the dynamic issues in a wide variety of non-profit organizations. Even though it was in a virtual space, I felt like visiting South America to see the passionate coffee farmers, and then traveled to Africa to see the farmers and young entrepreneurs smiling under the sunlight. Together we made it through helping organizations that will create lots of social impact during this extraordinary time.
Our project with a client in Senegal was seeing a final refinement when the cherry blossoms were blooming passionately. The team has been brainstorming ideas to help the business attract the initial funds so that it will be easier to receive investments in larger scales in the future. Thanks to the resource of IM860, we had the chance to interview the CFO of Root Capital, impact investor. In addition, I was grateful to Prof. Caroline Flammer and Prof. David Stolow for inviting me to audit a SR801 course about impact investing. I had a high-level understanding of how to determine a portfolio considering different “impact” levels and objectives, and the target selection criteria for Root Capital. There are different types of impact investors, therefore matching the business goals for both investor and fund recipient is critical. For instance, Root Capital has been focusing on coffee farmers in certain regions (not all countries in Africa), and they provide short term (about one year) working capital to support local farmers. Our client is looking for agricultural Capex funds, and irrigation pump loans is not a conventional loan type, therefore without a proven success record in the past, it would be difficult to obtain a loan from impact investors like Root Capital.
After identifying the root cause, we came up with some suggestions such as starting from a small number of farmers with certain selection criteria and seek for funding from philanthropic organizations or development banks. Our proposal was different from our client’s original plan, forming a mutual fund of 50 farmers as pilot run. Fortunately, our client is very open minded and seeking for ideas at this stage of the business, therefore our final presentation went smoothly. Our client was very happy about what we have done, and I feel grateful and accomplished because our idea may somehow help his organization to create more impact, including saving more energy, containing costs for farmers, and boost their economic status while protecting the environment. This project has been a fruitful experience for my first year MBA. I learned that everyone could create impact and add value in non-financial ways. Moreover, we can not take it for granted of what we have. Although the pandemic has been causing lots of inconvenience to our lives, we are extremely lucky to have stable Internet and abundant learning opportunities. There are many people from different parts of the world without all these resources, but still trying to grasp every possibility to help others to create impact. And that, is my biggest learning throughout the whole Social Impact Field Seminar.