Evaluation: Alterna’s Cultivation of Impact Small & Growing Businesses (SGBs)

Alterna is a non-governmental organisation (NGO) that supports locally-driven entrepreneurship to provide sustainable, market-driven and context-relevant solutions to development challenges faced in Guatemala and in the Central American region. Founded in 2010, Alterna first focussed on building its own impact ventures, and in 2013 started providing services to two types of entrepreneurs: ‘’inclusion SGBs’’ that tend to operate more in traditional/subsistence sectors and rural areas and be managed by entrepreneurs with less formal education; and ‘’dynamic SGBs’’ that have the potential to achieve social and/or environmental impact.

Both types of enterprise tend to be small when support commences (baseline median revenues are <€10k, or at the idea stage. Argidius first partnered with Alterna in 2014, renewing the partnership in 2016, and again in 2019. By the end of 2018 over 800 SGBs and 700 entrepreneurs had been supported. These enterprises had generated over €25M in incremental revenue; created 500 full time jobs (net); and mobilized over €10M external finance. The cost per enterprise ranged from €1k to €8k depending on the services delivered. ​

In 2017, an independent evaluation was commissioned to assess the results Alterna’s cultivation services delivered to SGBs in Guatemala between January 2017 and the end of December 2018, with emphasis placed on assessing Alterna’s contribution to SGB growth, and the impact of job creation on additional employees. ​

Key Findings: ​

  • Alterna’s cultivation program is relevantadditional, and successfully meeting SGBs most pressing needs. Alterna are perceived as a trusted and credible organization that provides high quality services and a strong focus on social and environmental impact, and inclusion. Alterna are a fast and smart learner
    • SGBs are growing revenues, creating jobs, and 25% of those supported in 2018 raised investmentCollateral benefits were also observed including developing the enabling environment of a new film sector in Guatemala, empowerment, community and household development, social and environmental outcomes. 
    • ‘’Supported SGBs stated that they would not have been able to make critical improvements to their businesses without Alterna and Alterna does not have a direct competitor in the market that provides the same services.‘’
  • Impact at the employee level:
    • All new employees interviewed improved their financial situation on taking up their new positions in the SGBs 
      • New employees in 4 of the 6 impact SGBs studied were young people just graduated from school and this was their first job and first source of income
      • In two of the three inclusion SGBs, new employees had been informal workers, working mostly in temporary jobs and earning significant lower wages.

Executive Summary
Management Response
Alterna’s thinking on segmentation has been incorporated into this report