Macro
After a lot of research , as for now, there is no direct competitors for the micro equity platform for social good. There are indeed crowd investing platforms but they are not targeted at the lower part of the pyramid. One example is Eureeca. Eureeca is the first global online crowd investing, or crowdfunding for equity platform connecting SMEs (small & medium enterprises) with investors (the crowd) to raise funds in exchange for equity. To put it simply:
they help business’s find funding.
Eureeca is not a threat to IMPCT but instead an example to follow. The team actually talked with the CEO and he gave so much valuable information about what awaits IMPCT. The team is very grateful with him and his team. IMPCT would like to take the best features of their platform and adapt it to impact investments in urban slums.
Micro
IMPCT does not have competitors in the slums and international foundations already doing a magnificent job to improve ECE. But it needs to be clarified that the team doesn’t see them as a huge threat and enemies but instead as partners and co-workers walking together to improve millions of lives.
In El Salvador, one of them is “Casa Maternal” founded in 1950 by Lolly Meza de Palomo.
This NGO has, since the beginning, helped three generations of kids have a better future. Florence Augsburg, the person running it, contacted IMPCT and kindly explained everything from educational plan, nutrition, legal, revenue streams and so on. This was very insightful for the team to understand how to penetrate the Salvadoran market. As said before, IMPCT doesn’t consider them as a big competitor since they don’t have the same long term goals. They have had a very successful daycare of hundreds of kids for the past 65 years with no plan of scaling or expanding. They even introduced the team to another powerful
Hilda Rothschild Foundation is a non-profit NGO established in 1994; the objective, to help women move out of poverty and disadvantage. Since 2011, they are focusing on providing high quality initial and pre-school education to the children of the poor, establishing and supervising programs in education for children ages 0 to 6, and training teachers in Montessori education principles and practices. They are doing a great job and it is very similar to what IMPCT aspires. However, their source of income is still donations (not investments) from wealthy people in the United States. The team plans on contacting them once in El Salvador or New York to talk about the Salvadoran and Latin American market.
Gymboree are also in the ECE business for 35 years in El Salvador. One would think Gymboree could be another competitor but they are very expensive and there is no way a family in the slums could ever afford this. IMPCT still needs to set a meeting with them to learn more about their activities and educational plan.
Informal Daycares are probably IMPCT’s most important competitor. These are mothers or women taking care of neighborhood kids in their own urban slums community. This is extremely common in El Salvador, Central America and many other countries. Having a baby can stop many mothers from working and earning income. So, they go to their relatives or neighbors to look after their kids in exchange of favors or money. Their advantage is they can trust each other and it is very convenient (proximity). However, the disadvantages are many:
during these period the kids are not getting any education, adults basically just need them to survive and wait to enroll in the national education system by age 5. They don’t get proper nutrition and there is no way you could know what those people are doing to the kids.
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Figure 19 Informal daycare in San Salvador
In El Salvador we hear terrible stories about physical abuse, sexual abuse and some rare cases selling the kids. This is atrocious and IMPCT contribute to stop this. The field agents need to convince the parents that IMPCT is the best solution for their kids. The educational daycares will provide quality early education and nutritious food in a clean and safe environment at a very affordable cost.
6.2. Alternatives
Macro
For investors, the alternatives are endless but IMPCT wants to focus on conscious impact investors. However, they still have a lot of alternatives but only the most important will be mentioned here.
Kiva is a 501(c)(3) non-profit organization that allows people to lend money via the Internet to low-income / underserved entrepreneurs and students in 86 countries. Kiva's mission is “to connect people through lending to alleviate poverty. They basically have thousands of individuals listed in their website with personal projects that you can contribute on. You can lend them money for them to launch their project, they will then make a profit and repay you with a small interest. IMPCT somehow consider them a threat because they have been growing fast around the world. However they target every kind of project ranging from agriculture, construction, street market stands, cattle and education among many others.
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So this is an opportunity to focus uniquely on education. But, demand is huge. If you really think about it and put it in perspective, the need in the slums around the world is so big that IMPCT needs to see them as complementary forces.
Of course the oldest way of helping others are donations. These are simply giving something of value to others in order to help them. A lot of times it is in the form of money. The problem is that most of the time when someone donates, they don’t know where their money goes and how it was used to alleviate a need. It is not personal at all and you only do it once. After the donation is made there is no link between the two parties. The donor is rarely cares about a follow up. IMPCT wants to change this and keep those “donors” active. In fact, IMPCT will promote investments and not donations. People will be interested in what their money is doing, the social and financial impact.
Micro
The most important alternative but sadly not the most prepared one are mothers. We don’t argue that the best way a kid can be raised is by their mothers. Here is Andres’ testimony:
“I was luckily raised by a very talented, thoughtful, kind and smart woman. Everything that my beautiful mother did for me as a toddler directly influenced where I am right now. Not only intellectually but also artistically. To give an example: she owns the most successful dance academy in El Salvador and ever since I was little I was exposed to music, movement and rhythm. Did this have any kind of positive consequences? Of course it did. People consider me very creative and talented in music and arts. I didn’t understand why until I got into this ECE world and understood that I am a living example of early childhood development. What if I could give a similar opportunity to millions kids?”
This is exactly what IMPCT is trying to do. The team don’t see mothers in slums with eyes of compassion but instead as capable and innovative edupreneurs. Therefore they are not an alternative, they are essential in the model and IMPCT wants to empower them.
The other form of alternative are non-educational daycares. These are very common in the
by ordinary people whose mission is to simply take care of kids. These are a good alternative to parents because they have more time to work. The only problem is that kids are not receiving any kind of education in them and have only basic services like changing diapers and feeding them.
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