Agora Partnerships, Washington, DC
This past summer, I had the opportunity to work for Agora Partnerships, a non-profit based in Washington, DC. Agora consults and invests in small companies throughout Latin America who meet one of the UN’s Sustainable Development Goals. These start-ups are small in scale, with many not yet having any employees beyond the founders. However, Agora helps the founders to grow their businesses, develop better and more sustainable practices, and potentially prepare the company for future investments and growth. Their goal is to create prosperity without damaging the environment, partaking in exploitative economics, or reinforcing social inequities and injustices.
Agora is part of a relatively new field of finance called Impact Investing. Many people are familiar with microfinance—Muhammad Yunus won the 2006 Nobel Peace Prize for pioneering microfinance in his home country of Bangladesh. Impact investing works along most of the same principles, but focuses on slightly bigger companies which have the potential to grow and impact more lives. I had the chance to meet with the founder of EOS International, an Agora company which grew from serving a few villages in Nicaragua to become a large network which has so far brought clean water to over 400,000 people. By using a business model where EOS charges a small fee for their purifiers, the non-profit has been able to grow without relying on donations in the same way most NGOs do. They even found that the purifiers were used more often and preserved longer by those customers who paid a fee, rather than receiving the filter for free. This model sounds counterintuitive or even unfair in a world currently accustomed to non-profits delivering aid to developing parts of the country—however, EOS and other Agora companies are trying to shift away from charity models that act as band-aid solutions. Instead of having massive aid programs where money gets lost or inefficiently spent, Agora companies act as drivers of their local economies, helping their communities to grow from within, rather than rely on foreign aid.
One of the best parts of my internship was the chance to learn about Impact Investing as a whole. I highly recommend two books which my supervisor recommended to me: Real Impact by Morgan Simon and The Innovation Blind Spot by Ross Baird. Impact investment organizations like Agora are transforming how our financial systems operate, trying to reform the status quo to make sure capital is not limited to certain demographics or geographic areas. For example, in the current ecosystem of venture capital, investors often talk about how they are on the lookout for not only great ideas, but great teams. On the surface, nothing is inherently wrong with the approach, but investors then tend to trust founders who went to the same schools as them, look like them, live nearby, etc. As a result of these biases, a shocking 98% of venture capital funds go to start-ups founded by men, with 2% left for female founders. Black and Latino founders receive less than 1% of VC funding. 75% of VC funding goes to start-ups located in New York, California, and Massachusetts. This distribution of funding is clearly unfair, but it is also extremely inefficient. Great founders with great ideas are waiting for the capital necessary to grow their companies, but they are overlooked because of where they live or how they look. For example, a Vietnamese immigrant founded a fish processing company in Texas, which takes the previously unused Asian Carp (an invasive species) that local fishermen catch, and turns it into gourmet filets and paste. Silicon Valley VCs would never touch such a company, since it doesn’t have the potential of a Snapchat or Facebook. But Village Capital, another impact investment non-profit, has helped the founders grow their business into a multi-million dollar operation.
Agora Partnerships currently only operates in Latin America, but could potentially bring their work to the U.S. I got the chance to witness first-hand what kind of impact Agora has had in Nicaragua, Ecuador, Honduras, Mexico, Chile, and other countries. Part of my time was spent on a project to better measure and report the impact results of Agora’s companies. We went through spreadsheets of data on revenue, employees, and customers reached, trying to determine how to best quantify what “impact” is. My geoscience classes at Williams turned out to be a valuable source of knowledge on sorting through data like this. It sounds straightforward, but unlike a traditional VC firm, Agora does not measure impact in strict terms of money. For example, one company that sells high-end solar panels may have much more revenue than a company which sells artisan crafts from Peru. However, the solar power start-up may only have ten customers who each pay 10,000 dollars, whereas the artisan crafts company sells thousands of goods produced by indigenous Peruvian women, who previously had no source of income. “Impact” is hard to define, but our best efforts tried to capture the social good produced by each company beyond the dollar signs. Going back to the previous example, the solar company sold enough solar panels to keep 100,000 pounds of carbon dioxide out of the atmosphere each year. There is no universal measure to compare which company has more impact, but our project was important to keep track of how Agora companies affected the communities in which they operated.
I was also given an independent project, to determine whether Agora should set up an internship network with U.S. colleges and universities, to connect students with their start-ups across Latin America. The basic idea is that students could be a cheap source of talent for cash-strapped companies, while students get the benefits of a study/work abroad experience. I researched existing programs to serve as models for Agora. I also conducted interviews and surveys to figure out how such a program might operate, and what the concerns of entrepreneurs and students were. I presented my findings to the company at the end of my internship: the results were mixed on whether to create an international internship program. However, I found my experience as a history major at Williams to be incredibly useful in the course of my research on the project. I did not set out to prove or disprove the feasibility of an internship program—like a good history paper, a more nuanced answer to the issue presented itself in the course of my findings.
I have always been interested in the possibility of starting a company, and this summer opened my eyes to the systems within which entrepreneurs operate. Businesses are not started in vacuums—they require time, energy, and money to keep them afloat and growing. Organizations like Agora are a key part in making sure everyone, even those who do not look like your typical Mark Zuckerberg entrepreneur, have the support they need. I learned how much I believe in the power of enterprise to improve agriculture, the environment, energy, healthcare, etc. However, too much of our focus is on the “unicorns,” tech firms backed by billions of dollars in venture capital. Agora showed me what happens when those who have been overlooked by the current system are given a chance—they better themselves and the world around them.
My summer in Washington DC would not have happened without the generous support of Peter ’79 and Laurie ’79 Thomsen, and I cannot thank them enough. I would also like to thank the ’68 Center for Career Exploration and especially Dawn Dellea—thank you for your hard work on ASIP and for giving me this opportunity to learn.
Megamenu Social