Inclusive Business Hub team

Practitioner Hub Administrator

After one year of operation, we review our project portfolio

Malawi
Sub-Saharan Africa
10. Aug 2011

As the Business Innovation Facility approached the end of its first year of operation, we reviewed our project portfolio so far to identify patterns and trends.

Projects supported with cost-sharing support:
So far, 18 projects have been approved by our independent Selection Committee to receive advisory support and facilitation on a cost-sharing basis. Seven projects from the earliest rounds have completed baselines and started implementation.

Which sectors are we supporting?
Agro-business is a clear cluster, with 8 projects involving agro-business and links with farmers. The pie-chart shows the range of other sectors covered (counting one or sectors per project, as several cut across sectors. E.g. mKRISHI is both agriculture and ICT).

What type of companies are we supporting?

Small and medium domestic companies predominate in the portfolio. Only 5 projects are with multi-national corporations (the majority southern-based). Interestingly:

  • 8 projects involve a start-up company. In these cases, inclusive business is not an adaptation of their business model, but is there core business.
  • 6 projects involve NGOs. In most cases, the NGO is helping to commercialise an approach as a start-up commercial business. E.g. Twin Trading is acting as a catalyst for Afri-Nut in Malawi.

Consumers or producer focused?

We define inclusive business as one that engages low-income people anywhere in the value chain, whether as producers, consumers, or any place in between. We have not sought any particular bias towards BoP consumers or producers. So far, the portfolio does comprise roughly equal numbers of consumer-focused and producer-focused projects. Though the full picture is also more complex:

  • In 10 of the 18 projects, smallholder farmers are the primary beneficiaries. In most cases they are ‘producers’, whose produce is an input to the inclusive business. But in some cases they are consumers of services aimed at supporting smallholders. Such consumption should ultimately support their yields and further production. So they do not fall neatly into our original categories.
  • Many projects straddle boundaries, benefiting distributors as well as consumers, or consumers as well as producers. For example, CARE/RSP (http://www.inclusivebusinesshub.org/page/newco-bangladesh) aims to recruit thousands of illiterate rural women as distributors in rural areas of Bangladesh. These are primary beneficiaries. But millions of rural consumers will also gain from local access to quality goods.

Ultimately the balance between consumer-focused projects and producer-focused projects will affect the quantitative assessment of the impacts of BIF. This is because it is possible to reach hundreds of thousands, or even millions, of low-income people as consumers. But a project that engages BoP people as suppliers, entrepreneurs or distributors is likely to engage them in their thousands, or perhaps tens of thousands when it reaches scale. Of course it is not just the number of people reached that counts. A blog by our Learning and Results Manager outlines the scale and scope of impacts we expect. Luckily in BIF we do not just chase numbers, but are finding ways to catalyse business change to deliver a range of commercial and development returns. The Portfolio Review shows that most projects are still in set-up stage, but the diversity and trends that we see so far suggest exciting times ahead.