Women's Small Business Initiative

The average entrepreneur in Haiti does not have business training, lacks formal credit history, and has difficulty accessing adequate financing to start or expand a business. When entrepreneurs do get financing, loan amounts, interest rates, and repayment terms tend to be unfavorable for meaningful impact. Haitian women earn less than half of men’s wages (Haiti Equality Collective, 2010), and have higher rates of unemployment. Most become street vendors. These adversities, along with systemic gender discrimination, contribute to women having higher rates of poverty compared to men. Addressing this disparity through a comprehensive program will lead to profitable businesses, increased incomes, and financial independence for participating women.

The Women’s Small Business Initiative provides business training and financing to help women build sustainable and profitable businesses to increase income, escape poverty, and achieve financial independence. It includes these major components:

1) Business training using the Street Business School curriculum

2) An initial zero interest collateral-free cash loan to start or scale up an existing business

3) Subsequent grants in the form of livelihood assets (e.g., goats, merchandise) to help sustain the business

4) Membership in a group savings pool for entrepreneurs

5) Ongoing coaching for two years

6) Digital financial inclusion

7) Creating a new app with a credit scoring algorithm

The program piloted in 2020 and we added different parts to it (e.g., higher loan amount, grants) to ensure participant success in the context of difficult socio-economic realities including 48% inflation in Haiti. This strategy also helped reduce the need to constantly borrow, fall into a debt trap, and led to income increases of 20%, 50%, and over 100%. We next look to expand the digital financial inclusion component and build an app with a credit scoring algorithm . This will track and assess credit worthiness of participants for significantly higher loan amounts to expand businesses and possibly approach traditional banks if desired. 

We primarily serve and directly impact the nearly half of Haitian households (45.1%) that are women-led. Sixty percent of these households live in extreme poverty before the earthquake on January 12, 2010 (IMF, 2020) and make up most of the street vendors and support agricultural supply chains (USAID). Mainly due to gender inequality, the women entrepreneurs have less access to adequate financial services to help them start or expand their businesses compared to men. They operate micro businesses without training and are undercapitalized. Thus, the vast majority cannot afford supermarket prices for food and essential goods (UN Women) nor make enough to adequately pay for their kids’ tuition and healthcare.

The Women’s Small Business Initiative helps businesswomen create sustainable and profitable enterprises that lead to increased income which helps to better meet their needs, care for their children, and become financially independent. This is done through business training, loans, grants, coaching, digital financial inclusion, and building credit history.

Our solution, the Women’s Small Business Initiative, is the result of Haitian women expressing their desire to better care for their families become economically independent. We are well-positioned to deliver the solution in various ways.

1. Gender Inclusivity: Women head this program and participated in designing it base on their economic realities, past experiences, and business goals. Women are found in positions of leadership within our organization.
2. Grassroots Character:  We are a mostly local community-led organization. Our members live in the communities we serve and hold leadership positions. Members of our Board of Directors live in the community we serve, as do our personnel.
3. Partnerships: We collaborate with over 12 women’s organizations with over 1000 members. We have also partnered with the Street Business School to provide business training using their curriculum. Additionally, we’ve met with key stakeholders in government and the business sector as well as other nonprofits working in this area.
4. Team Experience: Our team consists of experienced professionals in finance, business, program development, administration, and women’s economic empowerment.

We work with over 12 women’s groups having membership of over 800. A new cohort class of 20 will be trained and finance starting in the summer. 

We believe networking through Solve will facilitate the expansion of the digital financial inclusion component of our program and help us to become more efficient, impactful, and reach more people. 

Our solution is innovative in two categories:

• 1)Programming

During the 2020 pilot year of the Women’s Small Business Initiative, businesses struggled to be solvent and profitable. This reflected the dire need for funding levels to be higher than what the microfinance industry typically offers. Unfortunately, we did not have sufficient cash to infuse into the businesses at that time. However, during the second year, we had goats from a separate project in the countryside. We addressed the need for cash infusion with goats as cash equivalents. The businesses were assigned a certain number of goats which are bred and sold. All money from sales is put back into the businesses. This strategy helped reduce the need to constantly borrow and fall into a debt trap. Incomes increased 20%, 50%, and over 100%.

• 2)Technology

We use the offline mobile application Taroworks for field data collection and Salesforce a cloud-based database to manage information collected while making use of existing industry mobile wallets. However, creating an app to integrate loans, repayments, and other metrics to generate a credit score for higher loan amounts could significantly improve impact on participants. They would be able to qualify for loans from traditional banks when scaling to medium size enterprises.

Our goal is to support enterprising women by providing businesses training, financing, and 21st century technology tools to increase income through business creation. We are in a growth phase and will scale up and increase our funding by obtaining grants from foundations, supporters of microfinance, and individuals who will fund at higher levels upon seeing the impact of our work. To demonstrate impact, we use technology such as Taroworks and Salesforce for monitoring and evaluation.

Year 1:                                                                                                 

Build an app with a credit scoring algorithm, and train 200 women to start or expand businesses

Year 2-4:                                                                                                        Support 500 women per year to start or expand businesses, increase income, and exit from extreme poverty

Year 5:                                                                                                          Support 1000 women per year to start or expand businesses, increase income, and exit from leave extreme poverty

Entry and exit interviews are conducted to document the economic status, knowledge level, and capability of entrepreneurs. We subsequently measure for progress and success using these various indicators: 

• Completion of business training
• Access to financial resources
• Increases in income after year one
• Expanded use of mobile wallets
• Introduce an app with a credit scoring algorithm
• Entrepreneurs build sustainable and profitable businesses in 2-3 years
• Entrepreneurs exit from extreme poverty or poverty
• Experience improved quality of life (we administer surveys to gage for changes in quality of life)

Problem:                                                                                                        Entrepreneurs in developing countries start enterprises without business planning and training, lack adequate financing levels and technology access.

Activities:                                                                                                

• Facilitate businesses training and financial literacy
• Provide startup capital and adequate capitalization
• Inputs such as coaching, technology, and support services

Outputs:                                                                                                

• Knowledge of business principles and procedures
• Initiation or expansion of businesses                         
• Knowledge of financial institutions, qualifications, markets, equipment, and processes

Outcomes:                                                                                                    

• Short-term- increase income
• Intermediate- build sustainable and profitable businesses
• Long-term- removal from extreme poverty or poverty

Applications are at the core of our technology use. We currently employ the offline mobile application Taroworks for field data collection and Salesforce the cloud-based database to manage information collected. We also use of existing mobile wallets such as Moncash. We next seek to develop an app with an algorithm to generate a credit score for the thousands we will serve upon scaling up. 

Home Roots Foundation is committed to equity and inclusion across race, gender, age, religion, identity, sexual orientation, and experience. We actively recruit women into positions of leadership throughout the organization and ensure they have voices in shaping projects that impact their lives and wellbeing. 

Our model provides critically needed training, funding, and technology tools for impoverished women to start or expand micro and small businesses to increase income, build profitable businesses long-term, and better take care of their families. Our comprehensive program addresses the problems of financial exclusion, undercapitalized businesses, lack of business training, and gender inequality by economically empowering women. We’ve found that undercapitalization and lack of training are the two biggest impediments to success. Thus, participants are funding at higher levels than average and receive additional subsidies to help with sustainability and profitability. We mostly obtain funds from our foundation partners and individuals to fund the program. 

As a nonprofit 501 (c)3 organization, we obtain donations from individuals and grants from foundations.  We also raise funds from crowdfunding sites we have partnered with, such as GlobalGiving. We are currently in a growth phase and have added proper monitoring and evaluation tolls to demonstrate impact and the effectiveness of our model. Subsequently, we will next scale up and approach funders to obtain much higher levels of funding. In the future, participants will pay a small application fee to help defray costs depending on funding levels. We also have used revenue generating activities such as operating taxis. Revenue from the taxis were put back into the programs to help with sustainability.

We have received grants from various foundations that support our work for women’s economic empowerment to include JustPax Fund, Tawingo Fund, CPPS Heritage Mission Fund, and others. We just receive 20k to help train and fund a new cohort. We’ve also operated taxis to generate revenue for the women’s program.