Ask the average person on the street what comes to mind when they think of Jamaica, and the answer likely revolves around sun, rum, and music. But the Foromic conference in Montego Bay spotlighted the business side of Jamaica and the Caribbean, including how business leaders are beginning to recognize the region’s enormous potential for blending business and social impact using strategies such as corporate venturing.

Going beyond more traditional philanthropy and CSR, corporate venturing is a strategic approach linked to a company’s core business that offers opportunities for generating both social and financial returns. Global Corporate Venturing (GCV) Founder James Mawson describes its emergence this way:

Corporations and others are funding start-ups with an expectation of both financial return and making a positive difference to an area of social and/or environmental change. [The approach is using] the tools of venture capital developed over the past 75 years and, effectively saying [that] fast-growing businesses can and should [recognize] what effects they bring into the world by how they are making their money.

Businesses can apply this approach to many of their activities and functions, including research and development units, supply chain management, and strategic global partnerships, as well as on- or off-balance sheet investment funds and other corporate innovation activities.

GCV is currently tracking more than 1,500 corporate venturing units, including corporate innovation incubators and accelerators, and corporate venture capital funds that deploy capital to existing funds or as direct investors. This activity is happening around the world and growing in countries like China, where last year the internet company Tencent conducted approximately $5 billion worth of equity deals in 100 companies. Other corporates are developing funds with an explicit focus on investing in social businesses and social enterprises, such as Centrica’s Ignite Fund. Corporate venturing in the Caribbean is still relatively young and growing, both in size and in scale. But private and civil sector leaders are enthusiastic about its prospects, and many progressive leaders are actively testing related approaches to see how they can create better financial returns while simultaneously exploring ways to also deliver social outcomes in the region.

One example is Eppley Limited, an investment company with interests in Jamaica, the Caribbean, and Central America, and an affiliate of the global conglomerate Musson Group. Eppley has initiated a pilot program that enables micro, small, and medium enterprises (including artisan craft makers and food producers) to leverage their commercial relationships with larger companies (such as hotels) so that they can access capital efficiently—without the customary impediments imposed by banks and other traditional providers. The project gives these firms access to financing without having to provide collateral or historical financial information, or pay transaction costs. The program creates value (such as collateral) from these existing business relationships. It also improves coordination between small and large firms, which can access partner data (for supply management, for example) and payment systems. Managing this information electronically via a centralized technology platform is fundamental to the success of the program.

Another local example is the Branson Centre of Entrepreneurship Caribbean (BCoEC), which launched in 2011 with a vision of encouraging businesses “to operate in a sustainable and socially responsible way to improve livelihoods and transform the world.” BCoEC aims to generate jobs and growth for both Virgin Group companies and the overall economy by supporting entrepreneurs during business model development. Its efforts also benefit its business partner Virgin Holidays; contributing to the development of a vibrant community strengthens the community’s position as an attractive tourist destination. Importantly, if this were about building a direct, immediate return for Virgin Holidays, BCoCE would likely focus entirely on tourism. Instead, the incubator is industry-agnostic, recognizing the longer-term implications of its support. It looks at existing local factors and determines what makes the most sense in terms of sustainable economic growth for Jamaica and other parts of the Caribbean.

So, what makes the Caribbean so special when it comes to corporate venturing? Nearly 70 percent of the population is self-employed, which—given the relatively greater “autonomy” to make decisions quickly as well as more flexibility to experiment and change—makes it an ideal environment for disruptive business models. Through corporate venturing, small enterprises access support and investment from larger businesses, larger enterprises tap into emerging trends and new ideas, and society overall benefits from increased economic activity. The region is rich with many of the elements required for a vibrant corporate venturing ecosystem, including:

  1. Openness: The Caribbean is actively supportive of trade and access to global markets. This is also enabling growth in both exports and inbound commerce, such as tourism.
  2. Diversity: The Caribbean is a melting pot of cultures and languages—a huge advantage for the region, and one that can not only help fuel a vibrant and growing economy of creative businesses, but also protect and mitigate effects of economic downturns.
  3. Strategic positioning: The pervasiveness of English-speaking countries in the Caribbean, and the regions geographic proximity to the United States and Latin America create market access advantages.
  4. Unlocking microenterprise growth: There is a unique and vibrant micro-enterprise sector (including, for example, artisans) in the region, which has untapped potential for growth.

The efforts of organizations like Eppley and BCoCE represent the dynamic mood and attitude in the region. Businesses are embracing the opportunity to pioneer new ventures that create both commercial and social progress and impact, and the Caribbean is well positioned to take a meaningful leadership role in showing what is possible when leaders tap into business as a force for good. With the support of organizations such as AMCHAM, the Private Sector Organization of Jamaica, and Compete Caribbean, we can expect to see more companies initiate and evolve highly impactful corporate venturing strategies across the region.

Stereotypes can be deceiving. For a region better known as an amazing vacation destination and a relaxed pace of life, there is serious business model innovation underway, and business leaders in every other corner of the world stand to benefit from the lessons these pioneering endeavours bring to light.