INCAE Business School Costa Rica
Nicaragua’s Young Entrepreneurs Program (EJN, for its Spanish acronym), carried out by the Nicaraguan Development Institute (INDE), was created in 1991 as a Junior Achievement International (JAI) affiliate with local financial support provided by the International Development Agency (AID). Starting in 1997, EJN, no longer supported by AID, adopted a substantially new approach to train young entrepreneurs, without drawing away from JAI. With this new approach, EJN selected youths at risk as its primary program targets. This program version, supported by UNICEF for material reformatting, produced a successful pilot project that received the innovation award in 1998 for its adaptation of JAI materials to Nicaragua’s reality.
While EJN’s new program for young entrepreneurs secured ongoing UNICEF support, the traditional program, primarily funded by private companies, gradually lost momentum until it failed to have any beneficiaries in 2000.
In late 2002, the program’s Executive Director was challenged to secure stronger support for EJN’s traditional program after it had regained its vigor in 2001, benefiting 151 youths. She also expected to expand the impact and reach of EJN’s new program. At that time, her choices to accomplish these goals included:
1. Concentrating EJN’s efforts to promote a new legislation that would enable the private sector to make tax-deductible donations for educational purposes, like supporting EJN’s program.
2. Pursuing a new agreement with UNICEF to continue serving as a counterpart for its programs in Nicaragua, requesting venture capital to build startups.
3. Securing stronger, ongoing support from private companies to continue program delivery, developing a unique fund-raising approach for the program targeting youths at risk.
The case provides information on the social programs conducted by three private companies -Texaco, Pizza Hut and Coca-Cola- and their links to EJN’s traditional program. Readers are encouraged to characterize these ties and to offer their suggestions on how to seize any opportunities for EJN to move from a collaborative (donor-receptor) approach to strategic alliance-building scenario that brings greater benefits to both companies and EJN itself.
Based on this analysis that takes up a substantial share of the case, EJN’s Executive Director hopes to find a way to effectively approach these companies to raise funds for EJN.
This case may be used to introduce some notions associated with social ventures and to characterize the (donor-recipient) relationships maintained by private companies with EJN’s program as well as the opportunities available for more stable, long-term ties, like the relationship built by UNICEF and EJN.