Using Blended Finance To Do Something Never Done Before

When initiating a project, it can be intimidating to hear “look for examples, but you likely will not find any, because no one has ever done this before”. Upon first meeting my team’s client for SIRI Practicum, this was some of the first information we gleaned. While initially daunting, navigating a completely unique project in a team has proved to be informative and exciting. The team set out to narrow our scope, develop a workplan, and get an all-encompassing idea of our client’s expectations. Along the way, we have already learned much about each other, our own personal teamwork styles, working professionally with a client, and of course, searching for similar programs, with occasional success. 

Project Scope: 

A few weeks ago when I was choosing a project to work on for SIRI Practicum, I was immediately drawn to this project. Our client is an organization based in Brazil that works to sustainably develop the Brazilian Amazon, focusing on equitable housing and job opportunities to improve quality of life in the region. For this project, my team strives to design a strategy, using blended finance, to monetize the sustainable timber supply chain in the region, specifically for use in local social housing. 

At our first meeting, the client took extra time to ensure each team member thoroughly understood the mission of the organization, the rationale behind the project, and the intricate cultural complexities of the region in which we will be focusing. The client emphasized using blended finance, which uses a combination of public and private investments and funding to de-risk and incentivize sustainable markets. This project is the perfect candidate for blended finance and systems-level thinking. At this meeting, it also became clear that we were at the forefront of this project design, with few pre-existing programs like it and the client’s hope of taking a derivative of our program and expanding this beyond Brazil’s borders. Of course, this was extremely daunting, but as the team began research, developing the exact steps we could take to get ourselves to the finish line, we each became even more enthusiastic about completing this important and novel work.

Motivation:

I came to Columbia University with no investment experience and in fact, no experience working in the private sector at all. However, I have long wanted to gain skills in sustainable consulting and investing. While I do not have a thorough background in consulting, I have ample experience in research and data collection, and set out to utilize these skills as much as possible as I learned more about the consulting and sustainable investing sectors. In addition to research skills, I am highly organized, and enjoy cleanly maintaining teamwork with tools such as Gantt charts. While I still have skills to develop, these preexisting strengths were helpful as the team began to develop the work plan.

Work Plan and Team Expectations: 

The team is tasked with creating a plan to monetize the sustainable timber supply chain, specifically for use in social housing in Brazil. To start this project, and throughout the semester, it is critical for the team to conduct thorough research and to disseminate findings to each other. During the first two weeks, team members researched topics such as: blended finance, vertical integration, carbon credits in Brazil, indigenous groups local to our project area, and sustainable timber processing and transport methods. In addition to consistent research, the client has a number of other consultants working each on one certain aspect of this project. The team will collaborate with leaders from these groups to ensure the work we are producing is novel and important to the client. The group has outlined deadlines and weekly meetings for the rest of the semester, setting ourselves up to remain organized and on task. The group also established our norms, which will be important to the effective functioning of the group for the semester. We all agree to actively listen to each other and encourage equal participation, clearly and kindly communicate our perspectives, and importantly, to include social events to further group bonding. Active listening will be one of the most important norms this semester. In order to properly disseminate each of our research findings and work together to construct a plan for such a unique supply chain, teamwork and listening will be at the forefront of our meetings and our success. 

Preliminary Research Challenges:

For the first week, my task was to research the economics of our project, broadly. I looked into vertical integration, blended finance, timber supply chains, and any similar, pre-existing programs. While helpful for the project, this was also helpful for me to gain a better understanding of these processes. One challenge I have experienced so far with this research is, as was initially explained to us, there really are no similar programs currently in practice. There are timber companies that use vertical integration and non-profits that buy forest land to implement sustainable forest management, but there is nothing quite like this project. This makes program development all the more challenging, with no existing ideas to base work off of. However, this is also exciting, since we know we will be completing a meaningful project, despite the challenges. Another difficulty we have faced thus far is efficiently and thoroughly sharing out our research work. In order to gain the full breadth of knowledge required for this project the team splits up research categories, then shares findings at weekly meetings. However, it has been difficult, with so much important information we each feel we need to tell our groupmates, to do so efficiently, without forgetting key details. In the future, I will try to use my strengths in organization to develop a system to streamline this process. Perhaps this could include a weekly document where team members fill in their key points to stay on track, but also so team members can fill in any gaps the teammate may not have had time to include. 

Looking Ahead:

Thus far, the team has learned much about professional communication with clients, maintenance of organized shared online platforms, and completion of in-depth research on a unique topic. Perhaps most importantly, we have each learned about each other’s work styles, and are beginning to understand everyone’s individual communication styles and preferences. Continuing to find this connection and understanding will be key for continued success. Moving forward, it is important that the team clarifies the exact deliverables expected of us. We now have developed a firm understanding of our complex project, and this would be a helpful next step. We will also work to improve our understanding of the client organization so we can best tailor our work to their needs. Currently, my main question is: who is the target audience of our deliverables? It would be helpful to clarify how exactly our end products will be used, and this is something the team can ask at our next client meeting. I have learned much about sustainable investing and professional teamwork so far, and I am looking forward to furthering the team’s model of a financially-viable, sustainable timber supply chain in the Amazon, and hopefully, beyond.