An effective deal sourcing strategy is a prerequisite for any fund’s success. As a new fund, DFCD and its origination facility had to be clever in how it was raising its profile, while building its sourcing capacity. Especially to attract interesting bankable nature projects outside our focus landscapes.
WWF hired a professional partner to set up and manage the Opportunity Window. “We chose the Hague-based WorldStartup because of its global experience in and network for scouting impactful projects”, says Aaron Vermeulen. Another important reason was the global entrepreneurship platform’s collaboration with Venture IQ. This company specializes in software to map and target niche markets to scan for potential projects using online data.
This enables us to really target our scouting. The DFCD’s criteria for bankable nature-based business propositions are quite straightforward, but through Venture IQ’s software we can target specific sectors, countries or even landscapes, project sizes etc. We can refine our search further and further.
The launch event in November attracted more than 800 participants, while in January, a webinar targeting Latin America and the Caribbean was attended by more than 250 interested parties, primarily companies developing interesting projects and so-called enabling organizations.
“We’re really happy with the number of applicants, but fine-tuning the pipeline management process and putting the projects through the process took more time than initially anticipated”, tells Aditya Putta of WorldStartup. "The direct email campaigns have had quite a good response rate", says Dana Blom of Venture IQ. “We notice most intake forms coming in are agroforestry projects. Next we'll also be focusing on the three focus countries of the Scalable Climate Solutions Challenge.”
First results
The teams of WorldStartup and WWF spend quite some time to refine the scouting and funnel process as well as the templates. But now everyone is on the same page and the Opportunity Window is gathering steam. The well-attended webinars really boosted application numbers, so the team is looking forward to the events planned in spring to promote the DFCD’s Scalable Climate Solutions Challenge in Kenya, Uganda and Bangladesh.
Since its launch mid November, the Opportunity Window has received 116 applications from across the globe. Around 70 applications met the DFCD criteria and will be screened closely to understand the proposals better. We need to gauge whether the business can become bankable or not and understand the risks involved. WWF’s regional leads and local offices are very important in the screening process. They provide the local context. The scouting and screening is really a team effort. If we’re positive - one in five cases -, we ask them to fill in an assessment form.
“We see that the applicants score high on impact, but we need to dig deeper to understand the business model, the potential for scale and bankability”, says Blom. It is therefore not surprising that proposals directly from companies tend to be much more successful than proposals from NGOs. “We learned this through the process”, says Putta.
It’s fine that the proposals still have points that need working on, because that’s what the DFCD is there for. But applicants can illustrate better their market prospects. “The private sector is often engaged but we are looking for commitment, for example through support letters, strong off-take agreements and so on”, says Blom. “This interview triggered us to make a list of recommendations for applicants to strengthen their proposal.”
Some proposals coming through the Opportunity Window are close to approval. So next time we will share some interesting deals!
