California-based social enterprise investor NESsT has launched impact funds in Central Eastern Europe and Latin America to focus on livelihoods and sustainable land management.
In a statement, California-based NESsT said the new Violet Fund (CEE) and the repositioned Lirio Fund (LatAm) were its core impact funds in the two respective emerging markets, empowering social enterprises with capital and resources to solve critical social issues within vulnerable communities.
The announcements kick off the new year as the NESsT team looks ahead to double down on its global emerging markets strategy.
The NESsT Violet Fund is launching in partnership with Dreilinden gGmbH, a Germany-based non-profit dedicated to advancing societal acceptance of gender and sexual diversity. The mission of the fund is to facilitate better access to the labor markets and improve career progression in the workplace for marginalized communities, including LGBTQIA, ethnic minorities, at-risk youth, and people with disabilities.
"Communities that experience persistent social exclusion are most at risk of poverty," said Sebastian Siuchta, Violet fund director. "To build financial resilience against global economic shocks, such as war and climate change, individuals facing marginalization need access to quality employment opportunities with career growth, security, and a livable income, and that is at the forefront of NESsT's new impact fund."
The US impact investor further said the NESsT Violet Fund "is the first impact fund supporting SMEs committed to diversity, equity, and inclusion in Central and Eastern Europe. With this fund, NESsT aims to improve the lives of more than 2,000 individuals from marginalized communities to determine their own futures".
Since launching the NESsT Lirio Fund in 2018, the global landscape has evolved considerably. As a result of major disruptions and growing devastation from climate change, NESsT decided to refine the Fund's investment thesis to focus specifically on financing SMEs, improving livelihoods, and promoting sustainable land management in the Andes-Amazon basin.
The NESsT Lirio Fund portfolio enterprises maintain strong relationships with local communities, including indigenous communities, and help farmers to adopt practices that conserve the forest and promote gender equity. The Fund portfolio supports the livelihood of over 2,400 smallholder farmers and vulnerable workers, 45% of whom are women, in rural Peru and Colombia.
"One of the first enterprises we invested in when launching the NESsT Lirio Fund was Greenbox, a social enterprise that transforms regions in the Andes-Amazon of Peru from cultivating coca plants for use in drug trafficking, to harvesting organic fruit for use in value-add products," said Chad Sachs, Lirio fund director.
"Greenbox, a company that joined the NESsT Lirio portfolio in 2019, achieved a compound annual sales growth rate of 68% by the end of 2022. This success allowed NESsT to offer Greenbox an additional loan in 2022, demonstrating the potential for growth for companies within the NESsT portfolio."
Similarly, Pomario is a Colombia-based enterprise selling organic produce to Colombian families, retailers, and high-end restaurants. Pomario first joined NESsT as an incubation portfolio enterprise in 2022. A year and a half later, with NESsT's strategic guidance, Pomario grew to a size that enabled it to secure additional debt capital from the NESsT Lirio Fund.
Pomario hit record sales in its first year as a NESsT portfolio company, almost doubling its 2020 numbers due to new B2B sales channels, e-commerce, and the re-opening of restaurants.
