The Clinton Giustra Enterprise Partnership recently announced the launch of its latest social enterprise. Called Acceso Peanut Enterprise Corp., it’s aimed at the more than 12,000 small holder peanut farmers in Haiti.
The Partnership, founded in 2007, is an initiative of the Clinton Foundation focused on economic development and poverty alleviation. About two-and-a-half years ago, it changed its emphasis to market opportunities that generate social and financial returns by addressing gaps in Haiti, the poorest countries in Africa and other developing nation supply and distribution chains. Also, instead of looking for homegrown enterprises, the Partnership decided to start its own ventures with the goal of creating enterprises capable of both rapid expansion and replication, the better to have a lasting and substantial effect on poverty.
Usually, peanut farmers in Haiti work far from markets, so they pay intermediaries to transport the crops. “They’re at the mercy of the intermediary,” says Mark Gunton, the Partnership’s CEO. “Normally, they’re in debt by the time the harvest comes.” Acceso, instead, buys directly from farmers, storing the food in strategically located warehouses—there are five, but eventually that will go to 40—and then sells to five large buyers in Haiti, which, in turn, sell to the local market. (The plan also should reduce aflatoxin, a disease peanuts get from improper storage and transportation practices).
Other parts of the model include providing information about good agricultural practices, as well as working capital. Farmers usually don’t have the cash to employ the labor they need or use the best fertilizer. So Acceso supplies seeds and fertilizer stored in its warehouses at cost. That can increase yield by a factor of five, according to Gunton, in addition to producing higher-quality peanuts. Another benefit: making the peanuts available to Haitians. At the moment, the country imports about 40% of the food, according to Gunton. “We expect that in five years they will no longer need to import peanuts,” he says.
The various Partnership ventures fall into one of three models. Supply chain enterprises, as the name suggests, focus on improving the supply chain for a product or crop; that’s where Acceso Peanut falls. Second are distribution ventures. For example, a year-old enterprise in Peru sends truckloads of food, shampoo, and other goods to small warehouses that are then sold by women door-to-door. They make a 20% margin on whatever they sell. Third: training centers, which provide internships and training.
The key to all these enterprises is the ability to be replicated quickly. The Partnership has started six different businesses in one year, with a pipeline of six more, according to Gunton. In the case of Acceso Peanut, there are plans to apply it to other crops, like lime and sorghum.
Further growth also should come from strategic partnerships. A recent one with PepsiCo works with local cashew farmers in India to produce blended fruit drinks. The first pilot tapped 3,000 farmers; the next will work with 30,000. “These are people who live on close to $1 a day,” says Gunton. “This venture will make a massive difference to their income.”