Unleashing the Potential of Developing World Entrepreneurs.

1. Unleashing the Potential of Developing World Entrepreneurs.

2. Revolutionizing Development Finance • Our mission is to create opportunity for talented developing-world entrepreneurs to launch and grow successful, socially responsible businesses. We work to achieve this missionby giving them the right kind of tools, networks, financing and support.

3. Revolutionizing Development Finance • Entrepreneurship is critical to job creation but is especially challenging in developing countries. Developing world entrepreneurs have talent and expertise, but most do not have access to the tools or financing mechanisms needed to overcome these barriers to realize the full potential of their ventures. • Agora Partnerships supports entrepreneurs by targeting four core barriers to new venture creation: entry, education, financing and management expertise.

4. Financing for SMEs in Latin America Organizations in the Field • Entrepreneur Development in Latin America runs the gamut from NGOs and foundations to government and quasi-governmental organizations. The services they offer include technical assistance, business plan development, small scale grants and low interest loans, “brokerage” services with investors, entrepreneurial branding, consulting, curriculum development, teacher training, and networking facilitation. • Despite the interest in business development, many models have gaps—some provide technical assistance without financing while others provide financing at levels too low or too high to help small to medium businesses. Others seek to bring match resources to businesses that need them, but do not provide the financing themselves. • Agora’s Model • Agora targets small and medium business that create jobs and drive economies • Match high growth potential entrepreneurs with MBA candidates from prestigious business schools. • Agora then provides financing to the most promising of the businesses Source: bridges.org

5. On the Ground in Nicaragua • Nicaragua is the second poorest country in the Americas. 2.3 million people, 48% of its population, live on less than $2 per day. • 45% of all income goes to the richest 10% of the population. Only 14% goes to the poorest 45%. • 70% of Nicaraguans are under the age of 30. 60,000 jobs per year need to be created to maintain current employment rate • The potential • Low-wage environment/high marginal productivity of capital • CAFTA agreement will help exporters, increase competition • Untapped talent of entrepreneurs in Central America Source: United Nations

6. Nicaraguan Entrepreneurs face almost insurmountable hurdles • Closed social networks • Closed family groups • Socio-economic discrimination • Difficulty to imagine success, no role-model available • Lack of formal business training • Lack of venture creation training/experience • Information asymmetries • Limited understanding of VC model • Lack of financing • Prohibitive interest rates • Prohibitive collateral • No angel market • Poor entrepreneurship climate • Onerous regulations • Poor infrastructures • High set-up costs (170% average per capita GNI) • Squandered human potential • Insufficient new business / job creation • Scarce access to national and regional markets • Too many entrepreneurs fail or never try A comprehensive approach is required to address all barriers

7. Agora focus Larger Firms Microfinance Extremely poor Existing entrepreneurs and family businesses Self-employment in the informal sector Enterprise expansion in the formal sector Loans for working capital, usually to finance trade (<US$5000) Debt or equity to finance growth (US$50,000+)   Endeavor, TechnoServe, USAID Very limited   Commercial banks, multilateral banks Trickle-up, Accion, $100 million Omidyar fund. There is little support for early stage entrepreneurs in Nicaragua Start-ups Business scope Target population Low-middle income university-educated aspiring entrepreneurs Objective New enterprise creation in the formal sector Type/purpose of financing Debt or equity to finance new enterprise creation (US$25,000 - 200,000) Current support  Business support Not available  Financial support Not available

8. Agora’s model A for-profit, double bottom line angel venture capital fund that ensures the most promising Agora Entrepreneurs have access to capital Sources of Capital: Investors A non-profit organization that finds, educates, and supports socially responsible, developing world entrepreneurs. Source of Capital: Donors Venture Fund Two legally distinct, affiliated organizations working together to create wealth, jobs and opportunity in Nicaragua.

9. Support Reporting Ownership WASHINGTON DC NICARAGUA Expansion to another CA Country, 2008 Venture Fund Organizational Structure Executive Board Advisory Board Investment Committee Agora Nicaragua Advisory Committee MBA Student Consulting Teams Agora Entrepreneurs (12-20/year) Agora Portfolio Companies (12-18 over 3 years)

10. Agora creates a merit-based process to identify promising entrepreneurs and provide them the opportunity to demonstrate their potential. Agora matches students with entrepreneurs for an intensive consulting and due diligence process Agora Venture Fund provides direct investment in the most promising ventures that meet strict investment criteria. Agora assists in the launch and execution of the business providing strategic advice, incubation services, business contacts and advocacy. Entrepreneurial Potential Identify Consult Invest Support Potential Realized Agora’s Model Closed social networks Lack of formal business training Lack of financing opportunities Poor entrepreneurship climate Current barriers Agora’s answer

11. The Agora Venture Fund A micro-venture capital fund, sponsored and managed by Agora Partnerships, that expects to invest in 15-20 early stage, socially responsible companies in Nicaragua in the next three years. • Objectives • Support outstanding entrepreneurs reach their potential • Achieve a competitive IRR and mobilize additional capital • Create a new entrepreneur-driven model for socially responsible development that can be replicate globally • Investment range: U$25,000 – U$250,000 • Key Element for Success • Market and Entrepreneur-focused. Investment, not charity. • Management and Technical Assistance provided by Agora Partnerships, an affiliated non-profit organization. • Systematic risk reduction at all levels of the models. • World class investment committee and experienced on the ground management.

12. Agora Partnerships Core Competencies Description • Encouraging innovative thinking to solve social and business problems • Educating entrepreneurs about small business corporate social responsibility • Improving cultural appreciation for entrepreneurship • Making entrepreneurs understand they can play a critical role in the development and improvement of their country and community. • Developing financial and business case studies and educational material specifically for the small business sector. INSPIRATION • Developing, testing and implementing innovative financial structures to provide long term, growth capital to the small business sector. • Creating investment vehicles to invest directly in the small business sector with the expectation of a positive social and economic return • Contributing to global innovations in small business finance by sharing our experience and helping to build the field of entrepreneur models of development. INVESTMENT • Providing professional class strategy and marketing consulting to small businesses capable of creating positive change. • Hands-on help connecting entrepreneurs to suppliers, buyers, professional service providers and others able to assist in the success of the venture. • Leadership development training through workshops, peer to peer learning, and connection to a broader community. • On-going operations consulting to help the business manage growth. EXECUTION

13. Agora Entrepreneurs • Agora Entrepreneurs are: • Passionate about what they do • Driven by a double bottom-line • Experts in their field • They Understand: • The value of job creation • The value of social returns • The importance of hard work and persistence • They Share: • Our desire to learn every day • Our willingness • Our vision for a better Nicaragua

14. Evaluation and Metrics • Financial Returns • Social Returns • Education • Number of consulting hours • Number of MBA consultants working with entrepreneurs • Number of projects • Networks • Attendance at Open House events • Anecdotes of Agora provision of important contacts • Agora entrepreneurs working together • Growth • Skilled-Jobs creation • Increase in sales • Training hours • Growing businesses with corporate social responsibility • Tax-contributions

15. Key Lessons Learned • A Small Investment Can Go a Long Way • The “Missing Middle” as a Means to Economic Development • Adaptation to Changing Environments • Managing Expectations of the Entrepreneurs • Seeking Honest Feedback

16. Agora PartnershipsSome of our Partners www.agorapartnerships.org