Alexandre Furlan, CEO of Instituto Muda, has been building his business since he finished college 12 years ago. São Paulo generates 20,000 tons of waste on a daily basis. Yet only 5% of the residential buildings have public recycling collection service - the majority of it goes to landfill. Instituto Muda tackles the problem by picking and sorting recycled waste and donating it to waste cooperatives. The business supports some of the most vulnerable people in the community and improves their lives with higher incomes and growth opportunities. Instituto Muda is doing some amazing work to tackle inequality and promote a cleaner environment. But when the COVID crisis hit Alexandre was incredibly worried that it would destroy everything he had built...
At Yunus Social Business, we were acutely aware of the economic threat that COVID presents for social businesses like Instituto Muda and the communities they support. While governments in wealthy European countries have been subsidising employee salaries, this has not been the case for the emerging countries where our portfolio Social businesses operate. Therefore, we wasted no time in co-initiating, along with the World Economic Forum, the COVID Response Alliance for Social Entrepreneurs. The Alliance is a 48-strong group of global organisations, from foundations and multilateral organisations to private companies. It was set up to provide business and financial support to social enterprises across the world, so that they in turn can continue to improve lives in their communities.
We have been closely monitoring the needs of the social businesses we support and in our first wave of support we have already distributed $650,000 USD to 14 different social businesses. In Brazil, this has allowed Yunus Social Business to support the payroll for employees for Redação Online, 4YOU2, Moradigna and maintain the incomes for workers through the cooperatives that Instituto Muda was able to continue supporting. The businesses suffered near total loss of income through the most difficult periods of COVID.
Instituto Muda collects recycled waste from condos and donates 100% of it to cooperatives which employ people living below the poverty line. These local cooperatives would have had to close during COVID because of lack of resources, so Muda decided to pay their operating expenses to keep them open (in addition to the waste that they donate). Instituto Muda stepped in to provide them not only with the financial help to pay their workers to support their families, but also with the supply of masks, equipment and disinfectant gel.
We continue to monitor the support that the social businesses in our portfolio and pipeline require and are looking at distributing a second wave of funding shortly. As countries like India and Brazil are potentially looking just at the beginning of the pandemic crisis - we seek to be there for our businesses not just as an investor but as a trusted partner in good times and bad!
Francisco Vicente, YSB Brazil, told us that the "Brazilian social entrepreneurs were speechless when they received the news from the Covid Alliance, in the middle of the crisis, which gave them time and strength to keep working with their teams without losing focus on the core business. The relief funds were targeted to housing reforms for the poorest families, income generation for waste pickers, maintenance of schools in difficult to reach areas and mentoring for writing skills to students."
At the halfway point through the program we find ourselves sitting back and reflecting over the last five months. And what a fine journey of progress and development it’s been. We’ve seen our entrepreneurs learn and share all sorts from methodologies to frameworks to general advice about life and business.
We spoke to Molly Burke co-founder of Cycle Connect, our latest investment in our Ugandan Fund. Cycle Connect provides rural smallholder farmers with the necessary tools to propel them out of poverty.
We are delighted to be featured in the latest episode of the Global Goals Cast in the spirit of International Eradication of Poverty Day, celebrated last week, the episode asks: “Is it possible to #EndExtremePoverty”.