NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

WRI’s New Ventures program held its third Investor Forum in Mexico last week and honored four enterprises as winners of the Business Plan competition. All nine companies that presented in the competition were selected for their commitment to environment and their financial profitability. Winner’s included Itanoni Flor de Maiz, a gourmet tortilla franchise promoting native Mexican varieties of corn; Indesin, a company producing cogeneration plants for clean energy; Lightcom, a company with several patents for innovative solar lighting solutions for both indoors and outdoors; and Proteak, a commercial teak farm that will improve degraded lands. Other companies included Tema, which uses water lilies to clean contaminated lakes; BioPremium, which produces organic mushrooms; Alibio, which produces organic fertilizers and water treatment systems; Rio y Montana, which provides active ecotourism excursions; and Movere, which specializes in ecologically-friendly pallets and logistics services.

These companies may have an advantage in the market after being recognized by WRI for the environmental benefits and financial promise they show, but Luiz Perez Cano from the Nafta Fund presented some bleak statistics for the emerging markets, particularly Latin America and Mexico. Of the private capital in the world, 82% is directed to the US and Europe. Asia, including the large population centers of India and China, receives only 15%. Australia receives 2%, leaving Latin America with only 1%. Delving deeper, within Mexico, only 3% of investment for SMEs comes from private sources. These numbers do not bode well for SMEs seeking financing.

We hope that a program like New Ventures, with the complementary investing from funds like EcoEnterprises, Verde Ventures, and Equator Ventures, will accelerate the change of these statistics by showing that investing in our sustainable SMEs makes financial sense. We have seen an upswing of interest and investing in our companies by local private funds and angel investors over the past couple of years.

New Ventures selects environmental SMEs each year in Brazil, Mexico, India, and Indonesia. Each company receives business mentoring to improve the business plan and strategies and prepare to interact with investors, starting at a New Ventures Investor Forum. For more information, please visit the web site.