Verde Ventures Takes Big Step by Funding Small Businesses in Madagascar

9/26/2012

Impact Investors Expand Into Madagascar for Two Commodity-Based Companies: GIE Sahanala and Madécasse

 

Arlington, VA (September 27, 2012) – Verde Ventures, an investment fund founded by Conservation International, announced today that it has now provided a total of USD $475,000 in loans as well as technical assistance to Madécasse LLC and GIE Sahanala, which are small and medium-sized enterprises (SMEs) working in Madagascar. Both of these commodity-based companies are focused on building healthy, sustainable ecosystems as well as having a positive social impact. Verde Ventures’ latest investments will directly affect about 1,700 families across Madagascar.

“Conservation International’s Verde Ventures program is very proud of the successes our funds and technical expertise has had on socially and environmentally minded companies,” said Neel Inamdar, managing director of Verde Ventures at Conservation International. “With this latest round of support going to Madécasse and GIE Sahanala, our program is able to have a positive impact on hundreds of families throughout Madagascar.”

The unique natural wealth of Madagascar encompasses a spiny desert in the south, dry deciduous forests in the west and tropical rain forest in the east. These vital regions host at least 12,000 species of plants — 90 percent of which are endemic — and an array of fauna species, including 50 different types of lemurs. Many of these are recent discoveries with many more species being uncovered on an ongoing basis, making Madagascar an instrumental contributor to global biodiversity.

While many communities in Madagascar rely on these healthy ecosystems for their livelihoods, some resort to cutting down the forest for economic gain, which results in devastating long-term environmental and economic consequences. Currently, 80 percent of the country's forest cover has been lost, mostly due to destructive agriculture, mining and logging practices. Promoting sustainable business practices is a key element to conserving the unique habitats of Madagascar, where very few sustainable economic opportunities for rural populations exist.

Working in the northern region of the country, Madécasse produces fine chocolate and vanilla products grown in the area adjacent to the Tsaratanana Nature Reserve. The company directly supports local farmers by providing training and equipment that improves product quality and yields – in addition to purchasing the product at a premium. Madécasse is one of the only companies in Madagascar that also processes the cocoa into chocolate before it leaves the country. Keeping many of the aspects of the supply chain in country helps ensure jobs and production knowledge stay in Madagascar, while incentivizing sustainable methods of forest farming.

“Our efforts to produce a socially and environmentally conscious product have been furthered by working with Conservation International’s Verde Ventures program,” says Tim McCollum, co-founder of Madécasse. “This means we can invest more in making exceptionally good chocolate and in the people and places where we work in Madagascar.” Madécasse received a USD $275,000 loan as well as technical support from Verde Ventures to assist in their expansion efforts.

The second recipient, GIE Sahanala, a Fair Trade and organic exporter of vanilla and cashew nuts, received USD $100,000 in funding from Verde Ventures. In addition to providing financial support, Verde Ventures is actively supporting the company’s expansion and growth into both commodities markets, allowing GIE Sahanala to increase volumes and processing. Farming of these agricultural products is promoted as an alternative to deforestation activities in rural areas. This loan will also help the company diversify its operations by expanding into essential oils, peppers, cloves, cinnamon and wild rice.  The company currently employs 1,200 individuals, most of whom are women supporting households in rural areas of Madagascar. 

This latest news is part of a broader partnership with the French Development Agency (AFD) and the French Global Environmental Facility (FFEM) that enables Verde Ventures to expand its support to green businesses in Madagascar and across Africa. Through this partnership, Verde Ventures will provide USD$3.5 million dollars in financing to a total of 15 businesses operating in Africa by 2015. With the most recent allocations going to Madécasse and GIE Sahanala, Verde Ventures has 11 more projects it plans to invest in over the next three years. This support will help address the current lack of available, affordable capital, which is a major constraint to building green economies.

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Note to journalists:
For project site photos that can be used in relation to this story visit: https://ci.tandemvault.com/lightboxes/qxpQoiLSH?tc=tOAZC7tem
 
About Conservation International (CI) - Building upon a strong foundation of science, partnership and field demonstration, CI empowers societies to responsibly and sustainably care for nature, our global biodiversity, for the long term well-being of people. Founded in 1987 and marking its 25th anniversary in 2012, CI isheadquartered in the Washington, DC area. CI employs 900 staff in nearly 30 countries on four continents and works with more than 1,000 partners around the world. For more information, please see www.conservation.org, or visit us on Facebook or Twitter.
 
About Verde Ventures - Conservation International’s Verde Ventures program provides support for small and medium-sized businesses that contribute to healthy ecosystems and human well-being. Verde Ventures has enabled its partners to help protect and restore more than 1,146,924 acres (464,144 hectares) of important lands. Verde Ventures’ business partners also employ more than 55,000 local people in 13 countries. The Verde Ventures business philosophy is based on Conservation International’s steadfast belief that economic opportunity and responsible stewardship of the Earth are at the core of successful conservation efforts benefiting both people and nature.

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