News

In times of economic stability, ygap’s programs support early-stage impact ventures to refine their business models, validate the long-term viability of the venture, and increase opportunities for people to lift themselves out of poverty or disadvantage. The focus is on growth: improving profitability, increasing sales, and expanding the impact they are having in their local communities. However, these are not normal times. 

Small businesses in emerging markets – like those that we run most of our programs in – are particularly vulnerable to the impacts of this pandemic. Micro and small businesses form the backbone of emerging economies with approximately two-thirds of all formal jobs in developing countries in Asia and Latin America, and 80 per cent in low income countries, mainly in Sub-Saharan Africa. These businesses provide a market for local producers, a source of basic goods, and crucial services for vulnerable communities, reaching populations that are often overlooked by larger firms. These small businesses are now in a place where they are both particularly at risk of the economic shocks of COVID-19, and the greatest key to economic recovery. For ygap, having worked to support the growth of such businesses since 2008, this is a time not to hit pause. In fact, it has become vitally important for us to support their survival.

In response to the emerging challenges associated with COVID-19, we developed a Resiliency Toolkit for our alumni ventures and ecosystem partners that outlines clear actions that they can take to increase their resiliency in response to unexpected shocks, such as a pandemic. While this was a good first step, we knew we could be doing more. We asked ourselves how we might best support our ventures during this difficult time and what type of response would be relevant, timely, and ultimately, impactful. To help guide this response, we surveyed our alumni ventures to understand how COVID-19 has affected their businesses and how they’re working through these current challenges to determine where we can best play a role in supporting them. This is what we learnt. 

Balancing the immediate concerns of our ventures with an understanding that uncertainty abounds, we have mobilised an organisational response that is demand-driven, agile, and localised and supported by our global team. This response represents a temporary transition for ygap – from backing local change, to backing local survival. The objective of this response is to support our alumni ventures to continue operating; maintaining revenue, their employees, and their ability to create social impact. 

This response has three tiers that will enable us to produce support content and resources through our global response, engage with and support the sector through our ecosystem response, and most importantly, create locally relevant resiliency programs with each of our six program teams that respond to the unique needs of that area. 

We recognise that these are unprecedented times and that significant  unknowns remain. Firstly, we recognise the state of the pandemic differs between each country we work in. Varying government restrictions, lockdown laws, and the type of venture itself all impact the ability of our entrepreneurs to operate. Secondly, we have never supported our ventures through a pandemic before, so there may be any number of variables that could appear as we roll out this response. Finally, we expect that given these unknowns and the current rate of change surrounding the pandemic, that the type of support required by our ventures will change over time.

We are, however, confident that our core capabilities and skills as an organisation – conducting detailed needs assessments, providing operational and strategic support, developing learning resources and content, brokering connections, and distributing capital in an effective way – will enable us to respond to these unknowns if and when they occur.  

What we know for sure is that we are not going away, and that we will continue to evolve our outputs to support local impact ventures and the communities in which they work. We will continue to back local.

– Simon Lee, Head of Global Programs, ygap