SUMMARY OF FINDINGS AND RECOMMENDATIONS
Research Approach Definitions For the purposes of this report, NESsT uses both its own definition for impact enterprise as well as that of the Rockefeller Foundation research initiative. NESsT defines impact enterprises as businesses that solve a critical social problem in a sustainable manner. NESsT invests in enterprises that move marginalized communities out of poverty and exclusion. The working definition developed by the William Davidson Institute and chosen for The Rockefeller Foundation initiative defines an impact enterprise as a financially self-sustainable and scalable venture that actively manages toward producing significant net positive changes in wellbeing across underserved individuals, their communities, and the broader environment. Given that a major part of the research is derived from NESsT’s own portfolio and context, impact enterprise as defined by NESsT will be a main focus of this report. However, NESsT’s definition falls within the broader definition chosen for the initiative, and is completely consistent with the Foundation’s own interest in supporting underserved populations or communities. Particular emphasis will be given to early-stage impact enterprise development and the importance of strengthening support for early-stage growth. NESsT defines early-stage enterprises as enterprises that are 1-4 years into their development and show potential to be financially self-sustainable and scalable. The enterprise may be growing or replicating its model, but it is still not ready for pure market investment. Therefore it relies on patient capital (grants, soft loans, quasi equity) and non-financial support to get to the next phase of growth.
Geography NESsT focused the research on Latin America and Central Europe, the two regions where it has operated for over 15 years. In particular, the research focuses on Argentina, Brazil, Chile, Ecuador, and Peru, with some cases from other countries in Latin America including Colombia, Mexico and Central American countries. For the purpose of illustrating important models and innovative programs and policies, this report also highlights cases and experiences from Central Europe, particularly Croatia, Czech Republic, Hungary, Romania and Slovakia. There are also cases and 2
no free ride: sowing the seeds of impact enterprise. summary of findings & recommendations Prepared by NESsT for The Rockefeller Foundation. Copyright © 2012 NESsT.