Evaluating the Funding Sources of Coffee Exporters in Colombia

Campesino Specialty Coffee is a Colombian company sourcing specialty coffee directly from smallholder farmers in Antioquia. To fulfill their mission of providing long-term solutions to coffee communities, they have a direct relationship with producers, providing complete transparency and upholding sustainability at the farm level. They started in 2016 in the town of Jericó, Antioquia with five dedicated farmers and have grown to over 120 producers. By focusing on quality, they have been able to increase the return to their producer partners and provide a higher-quality coffee to their roaster partners, creating a sustainable business operation for all parties involved. To further increase the impact in the community, they have launched a Coffee Education Center in Jericó, to provide continuing coffee education to their producer partners, their families, and the coffee community 

To improve their financial situation, they requested a local and a remote F2F volunteer to evaluate their grant sources and propose new funding sources. The local volunteer chosen was Andres Prieto, an Industrial Engineer with an MBA who is an expert in risk management and social responsibility. Andres has a lot of experience in organizational development and measuring the return of social investments. The remote volunteer selected to work with Andres was Alen Amini, who holds a BS in Supply Chain and Operations Management, an MBA and an MPA from the Harvard Kennedy School. He currently works as a management consultant at a social impact consultancy firm; advising nonprofits, government agencies, and mission-driven companies on strategic planning and overall program development. 

During the assignment, Alen researched and presented ways in which Campesino could find more funding in the US, from banks, donors, and NGOs. Additionally, he gave them recommendations on how to improve their relationships with US-based banks and how to raise their credit score. On the other hand, in early December 2020, Andres flew from Bogota to Medellín to spend six days with Campesino’s CEO and visit their offices in the city and their facilities in Jericó.

During the visit, Andres trained and coached Campesino’s senior management in several strategic planning topics, especially on risk assessment. After the first couple of days of his trip, Andres identified areas in which Campesino had deficiencies, or issues that needed improving, and made recommendations. He concluded that although Campesino was already generating social value through its education services to the farmers, they could generate even more social value by teaching them about organizational and business topics such as how to develop their financial statements and how to use the financial system. 

To improve their economic value, Andres recommended that they sign longer-term contracts with their producers and clients, to ensure the purchase of coffee at better prices, and its sale under better conditions. He also helped them negotiate better interest rates and a higher credit amount with their local bank. Finally, he also recommended that they review their risk assessments, as he believes they were overvaluing their legal risks and undervaluing their cash-handling risks. 

Thanks to Alen’s and Andres’ help, Campesino is now better prepared, both financially and organizationally, to increase the scale of its coffee production and the reach of its education center. This will improve the conditions and capacities of their associated coffee producers, increasing their quality of life, and providing them with more long-term stability.