We seek to build a culture that transforms human lives, a culture of solidarity.

by Jean-Christophe NOTHIAS | Editor-in-chief, NGO Advisor
thedotgood uncategorized pedro werneck
Pedro Werneck
Instituto da Criança’s Co-Founder and President

Investment in Brazil’s non-profit sector used to rely on private sponsors and small donors. During its 25 year history the Instituto da Criança has always sought to diversify its income streams and establish more long-term, sizeable investments to support its projects. We talk to Pedro Werneck, a social entrepreneur with 35 years of experience and the President of the Instituto da Criança, about how with the best business practices and an ideology of solidarity his organisation is helping to reshape the sector.

Jean Christophe Nothias

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Pedro Werneck
Instituto da Criança’s Co-Founder and President

The campaign was developed collectively with my brother Carlos and some business friends who volunteered to help us.
It was named “Campanha de Cotas” and aimed at companies that wanted to start social responsibility projects but did
not have the capacity to do it on their own.

To make it attractive, we offered incentives that corresponded to the amount invested and recognised companies and
entrepreneurs with the title of co-authors for the projects we have completed together. This campaign also helps
achieve financial stability for the Instituto da Criança (IC). Through it we are able to cover our operational costs and
finance our own projects through it.

Currently, there are about 30 companies participating in this program and it is now recognized as a case study in the
management of social projects.

Jean Christophe Nothias

The need for equity in the social-profit sector is a contemporary issue. Social enterprises have been lacking equity-like capital (aka patient capital, quasi-equity) – patient long-term capital, which enables them to scale up their operations. Some foundations have started recently pooling investments and providing SPOs with unrestricted funding. What are your thoughts on this topic? What are the main challenges on the demand and the supply side?

Pedro Werneck
Instituto da Criança’s Co-Founder and President

I believe that every form of funding is valid and, without a doubt, a long-term direct investment could provide
exponential growth in the third sector. Specifically, long-term financial investment products can be seen in a structured
way in the European context. There they have investment funds such as the European Structural and Investment Funds
(ESIF) and also the European Social Fund (ESF).

However, here in Brazil, we do not have a similar model yet. We have the practice of investment through contests from
Foundations and Funds such as The Brazilian Development Bank (BNDES). In addition, a popular fundraising tool is
crowdfunding, which has even included a match-funding campaign by the BNDES itself to stimulate donations. Even so,
these are specific initiatives. I would say that our long-term investment scenario is still in its initial phase. A recent
advance was the approval of the Endowments Law in January this year.

I see the opportunity of raising resources without restrictions in a positive light, as it would enable the flow of resources
to the organizations’ operations, as well as to social investments. In this way, supply and demand could become more
balanced, given that today we have a great demand for resources and a modest supply. At the moment the high degree
of risk in these social investments drives backers away, especially if we consider that the return will be social rather than
financial profit, which is not a widespread concept yet.

In our case the IC is not a social business. We do not have amitions for profit. The investor’s support will be implemented
in social actions and co-participation in the results. Our purpose is to promote a Culture of Solidarity and we do this by
raising private capital, resulting in private social investment. We believe that in this way we contribute, with our network
of institutions, to solving the issues of social inequality in Brazil.

I believe that every form of funding is valid and, without a doubt, a long-term direct  investment could provide exponential growth in the third sector.

Jean Christophe Nothias

The need for equity in the social-profit sector is a contemporary issue. Social enterprises have been lacking equity-like capital (aka patient capital, quasi-equity) – patient long-term capital, which enables them to scale up their operations. Some foundations have started recently pooling investments and providing SPOs with unrestricted funding. What are your thoughts on this topic? What are the main challenges on the demand and the supply side?

Pedro Werneck
Instituto da Criança’s Co-Founder and President

I believe that every form of funding is valid and, without a doubt, a long-term direct investment could provide
exponential growth in the third sector. Specifically, long-term financial investment products can be seen in a structured
way in the European context. There they have investment funds such as the European Structural and Investment Funds
(ESIF) and also the European Social Fund (ESF).

However, here in Brazil, we do not have a similar model yet. We have the practice of investment through contests from
Foundations and Funds such as The Brazilian Development Bank (BNDES). In addition, a popular fundraising tool is
crowdfunding, which has even included a match-funding campaign by the BNDES itself to stimulate donations. Even so,
these are specific initiatives. I would say that our long-term investment scenario is still in its initial phase. A recent
advance was the approval of the Endowments Law in January this year.

I see the opportunity of raising resources without restrictions in a positive light, as it would enable the flow of resources
to the organizations’ operations, as well as to social investments. In this way, supply and demand could become more
balanced, given that today we have a great demand for resources and a modest supply. At the moment the high degree
of risk in these social investments drives backers away, especially if we consider that the return will be social rather than
financial profit, which is not a widespread concept yet.

In our case the IC is not a social business. We do not have amitions for profit. The investor’s support will be implemented
in social actions and co-participation in the results. Our purpose is to promote a Culture of Solidarity and we do this by
raising private capital, resulting in private social investment. We believe that in this way we contribute, with our network
of institutions, to solving the issues of social inequality in Brazil.

the dot good uncategorized test
Jean Christophe Nothias

The need for equity in the social-profit sector is a contemporary issue. Social enterprises have been lacking equity-like capital (aka patient capital, quasi-equity) – patient long-term capital, which enables them to scale up their operations. Some foundations have started recently pooling investments and providing SPOs with unrestricted funding. What are your thoughts on this topic? What are the main challenges on the demand and the supply side?

Pedro Werneck
Instituto da Criança’s Co-Founder and President

I believe that every form of funding is valid and, without a doubt, a long-term direct investment could provide
exponential growth in the third sector. Specifically, long-term financial investment products can be seen in a structured
way in the European context. There they have investment funds such as the European Structural and Investment Funds
(ESIF) and also the European Social Fund (ESF).

However, here in Brazil, we do not have a similar model yet. We have the practice of investment through contests from
Foundations and Funds such as The Brazilian Development Bank (BNDES). In addition, a popular fundraising tool is
crowdfunding, which has even included a match-funding campaign by the BNDES itself to stimulate donations. Even so,
these are specific initiatives. I would say that our long-term investment scenario is still in its initial phase. A recent
advance was the approval of the Endowments Law in January this year.

I see the opportunity of raising resources without restrictions in a positive light, as it would enable the flow of resources
to the organizations’ operations, as well as to social investments. In this way, supply and demand could become more
balanced, given that today we have a great demand for resources and a modest supply. At the moment the high degree
of risk in these social investments drives backers away, especially if we consider that the return will be social rather than
financial profit, which is not a widespread concept yet.

In our case the IC is not a social business. We do not have amitions for profit. The investor’s support will be implemented
in social actions and co-participation in the results. Our purpose is to promote a Culture of Solidarity and we do this by
raising private capital, resulting in private social investment. We believe that in this way we contribute, with our network
of institutions, to solving the issues of social inequality in Brazil.

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