Village Enterprise

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Village Enterprise
VE Logo.png
Founded1987 (1987)
FocusEconomic development
Location
Area served
Africa
MethodGraduation Approach
Key people
Employees
140+
Websitewww.villageenterprise.org

Village Enterprise (formerly known as Village Enterprise Fund) is a 501 (c) (3) nonprofit organization that equips rural Africans with the resources to create sustainable businesses. The organization focusses on the micro-enterprise sector.

Established in 1987, Village Enterprise is active in the poverty reduction and microenterprise development fields, targeting people living below the extreme poverty level of $1.90 a day or less (as redefined in 2015 by the World Bank[1]), especially women and youth.

History[edit]

Village Enterprise was co-founded in 1987 by Brian Lehnen and Joan Hestenes.[2] For the first several years, Village Enterprise remained a small, volunteer-run organization that was operated from their home.[3]

In 2010, Dianne Calvi, Village Enterprise's first outside CEO was hired. The name changed from Village Enterprise Fund to Village Enterprise.

In 2011, the new Village Enterprise Graduation model was launched. The new model included rigorous targeting methodology, a one-year training program, and a savings program in addition to a cash grant and mentoring.

Village Enterprise is headquartered in San Carlos, California, with regional offices in Kitale, Kenya; Soroti, Uganda; and Hoima, Uganda, and just over 140 employees.[4] Over 95% of Village Enterprise's staff are East African, including its in-country leadership, a model that was recognized in the Spring 2013, 10th Anniversary edition of the Stanford Social Innovation Review.[5] Village Enterprise also employs local mentors for their businesses, who live in the communities they serve.[6]

Program[edit]

In 2011, 41% of those living on less than $1.25 per day reside in sub-Saharan Africa and it is forecasted to increase to 81% by 2030. Village Enterprise works in remote, rural areas of East Africa where as of 2008, over 60% of the population live below this extreme poverty line.[7]

Village Enterprise's graduation program consists of a set of sequenced interventions recognized by CGAP (the Consultative Group to Assist the Poor) as “key components to put very poor people on a sustainable pathway out of extreme poverty.” According to Nicholas Kristof of the New York Times, “the graduation program gives very poor families a significant boost that continues after the program ends.”[8] Common elements of graduation programs include business training and ongoing business mentoring, start up grants/asset transfer, and a business savings program. Other entities that follow a graduation model also provide limited consumption support, though Village Enterprise does not.

The Village Enterprise microenterprise model targets individuals who live under $1.90 a day using Grameen Foundation’s Progress out of Poverty Index (PPI)[9] combined with a village-based Participatory Wealth Ranking.[10]

The Village Enterprise model includes a year-long program that includes 14 modules of financial literacy and business training, a start up grant of $150, mentoring, and savings group formation and support.[11] Village Enterprise gives grants rather than loans, as people living in areas that Village Enterprise serves typically don’t have access to banks, or, aren’t ready to take on a loan. Recent research has shown that microloans have not shown to be successful in leading the ultra-poor out of extreme poverty.[12]

Typical businesses include farming, livestock, tailoring, and small retail businesses.[13] Each business has three business owners, to diversify risk and pool skill sets,[14] and supports an average of 20 people based on the size of families in the area.[15] Approximately 80% of Village Enterprise business owners are women.[16]

As an exit strategy, Village Enterprise forms Business Savings Groups (BSGs) of 10 businesses each. BSGs are a self-generating, self-managing form of microfinance that pools savings and loans to members. BSGs provide members ongoing protection against financial shocks and access to growth capital. Over seven million people across Sub-Saharan Africa currently participate in savings groups.[17]

Areas of work[edit]

Conservation[edit]

Village Enterprise's conservation program[18] was initiated in 2007 around the Budongo Forest, one of Western Uganda's critical chimpanzee habitats in partnership with the Jane Goodall Institute. Since then, Village Enterprise has extended to a wide band of protected areas and corridors. As of September 2015, the program is being implemented in southwest Budongo Forest villages and into the Hoima District community forests in Uganda. In 2012, Village Enterprise introduced the model in Kenyan villages surrounding the Kakamega Forest in partnership with Kenya Wildlife Services.

Youth[edit]

Village Enterprise created a program that aims to support rural youth entrepreneurs. This program is carried out by local business mentors. The program was based on the results of a Youth Study[19] conducted in Spring 2014 in partnership with FHI 360 and USAID to identify retention, training, and business selection strategies.[20]

Women businesses[edit]

Village Enterprise participated in a Boston Consulting Group study[21] on empowering women entrepreneurs in 2014. The report looked specifically at the importance of social capital and networks for the success of women entrepreneurs.

Financial initiatives[edit]

Village Enterprise's Business Savings Groups (BSG) provides a service to save, take out business loans, and access interest-free financing for family emergencies, thus acting as both insurance against catastrophes and as banks as a source of capital for business expansion.

Village Enterprise became an early adopter in the "savings revolution" by adding this component to their model in 2012. Across Kenya and Uganda, each BSG saved an average of $455 last year in 2014.[22] In 2014, they participated in a MasterCard Foundation research study of practices and possibilities in savings[23] and provided extensive data on the needs and preferences of 139 of their savings group members in Uganda.

Village Enterprise's Innovation Incubator is running studies and pilots to determine the most sustainable and viable means of linking rural entrepreneurs to stronger markets through market analysis and mapping.

In 2013, Village Enterprise launched its Smarter Market Analysis and Risk Assessment Tool (SMART),[24] which determines the profitability, risk, sustainability, demand, and price fluctuation of different crops at the local market level. The tool has been recognized by the Rockefeller Foundation's 100 Next Century Innovators (among 1,000+ applicants) and featured in NextBillion.net.[25]

Results[edit]

Internal monitoring data show that 75% of the businesses that Village Enterprise starts are still in operation after four years.[26]

Randomized control trial[edit]

Village Enterprise is currently undergoing a Randomized control trial (RCT) in 6,600 households across a diversity of settings in rural Uganda with Innovations for Poverty Action (IPA). This RCT will provide new knowledge to contribute to the graduation program ecosystem, particularly questions on the marginal impact of individual components.[27][28]

Village Enterprise uses TaroWorks[29] to collect data via smartphones and then to analyze and report on the performances.

Funding[edit]

Village Enterprise is funded by individuals, foundations, corporations, and government and multilateral organizations, including USAID and FHI360.

External reviews[edit]

In 2010, Charity evaluator GiveWell rated Village Enterprise as one of their top charities.[30]

In, 2012, 2013, 2014, and 2015 Village Enterprise received Charity Navigator’s 4-star rating.[31]

In 2012, the Rockefeller Foundation recognized Village Enterprise as a Next Century Innovator for developing SMART (Smarter Market Analysis Risk Tool), a mobile agricultural tool that identifies risk/reward factors for small-scale farmers to consider when deciding which crop(s) to plant.[32]

In 2015, Village Enterprise's grants-based ultra poor program was recognized by Innovations for Poverty Action (IPA)[33] and featured in the New York Times.[34]

2010-2015 Village Enterprise received Guidestar’s highest, gold rating for five consecutive years.[35]

2015 Village Enterprise received Great Nonprofit’s "top rated nonprofit" award.[36]

2016 Village Enterprise was selected by The Life You Can Save as one of their top, evidence-based charities.[37]

References[edit]

  1. ^ World Bank forecasts global poverty to fall below 10% for first time
  2. ^ Maslow on Management, Abraham Maslow, John Wiley & Sons, Inc., p. 138
  3. ^ Village Enterprise - History
  4. ^ Village Enterprise - Field Team
  5. ^ Diversifying NGO Leadership - Stanford Social Innovation Review
  6. ^ Village Enterprise - Business Mentors
  7. ^ Rural Poverty in the Developing World - IFAD Archived September 12, 2015, at the Wayback Machine
  8. ^ The Power of Hope Is Real - The New York Times
  9. ^ Working with rural youth - USAID[permanent dead link]
  10. ^ Village Enterprise - Our approach
  11. ^ 5 Career Lessons I Learned From African Entrepreneurs - Huffington Post
  12. ^ In their Own Hands, How Savings Groups are Revolutionizing Development. Pps 6, 10
  13. ^ Diversifying NGO Leadership- Stanford Social Innovation Review
  14. ^ Working with Rural Youth - USAID[permanent dead link]
  15. ^ Successful Ugandan Tailor Helps Mend the Fabric of Her Torn Country - A Path Appears
  16. ^ Village Enterprise Performance Dashboard
  17. ^ Practices and Possibilities in Savings Groups - Village Enterprise Archived January 5, 2015, at the Wayback Machine
  18. ^ Village Enterprise - Conservation
  19. ^ Working with Rural Youth - USAID
  20. ^ Village Enterprise Youth CLA and USAID's Community Connector in Uganda - Learning Lab
  21. ^ Bridging the Entrepreneurship Gender Gap: The Power of Networks - Boston Consulting Group
  22. ^ Village Enterprise Performance Dashboard
  23. ^ PRACTICES & POSSIBILITIES IN SAVINGS GROUPS - Mastercard Foundation
  24. ^ Information as a Cash Crop - Stanford Social Innovation Review
  25. ^ SMART-er Ways to Plant Profitable Crops - Next Billion
  26. ^ Village Enterprise - Impact Studies
  27. ^ A multifaceted program causes lasting progress for the very poor: Evidence from six countries - Science Magazine
  28. ^ http://villageenterprise.org/wp-content/uploads/2015/12/Science-2015-Banerjee-1.pdf
  29. ^ TaroWorks Archived January 12, 2016, at the Wayback Machine
  30. ^ Top-rated charities - 2010 archived version - Give Well
  31. ^ Charity Navigator: Village Enterprise
  32. ^ Aid for Africa Member Village Enterprise Recognized as One of 100 Next Century Innovators - Rockefeller Foundation
  33. ^ Ultra Poor Graduation Pilots - Innovation for Poverty Action
  34. ^ The Power of Hope Is Real - The New York Times
  35. ^ Village Enterprise received Guidestar’s highest, gold rating
  36. ^ Village Enterprise received Great Nonprofit’s “top rated nonprofit” award
  37. ^ Top Charities, Backed by Evidence, The Life You Can Save, retrieved at 29 December 2016