How the combination of public, private, and philanthropic capital can unlock funding for impact projects in vulnerable territories
The Amazon holds immense potential for businesses that conserve the forest while strengthening local communities. These are initiatives range from sustainable forestry and agro-extractivism to community-based tourism and regenerative agriculture.
However, most of these enterprises face a major challenge: limited access to credit and investment, as they are often deemed “high risk” by traditional banks and investors.
In this context, blended finance emerges as a strategic solution. It combines philanthropic, public, and private capital to reduce risk and attract investment in sustainable enterprises. By taking on the “first risk,” organizations like NESsT create the necessary conditions for banks and private investors to feel confident in supporting these businesses, thus increasing their access to credit and growth capital.
This model is grounded in three key pillars:
Impact: A strong commitment to sustainable development and social inclusion;
Risk-adjusted returns: Different types of investors take on varying levels of risk aligned with their expected returns;
Leverage: Catalytic capital assumes the first risk, reducing the exposure of private investors.
This arrangement can include guarantees, cross-subsidies, technical assistance, patient capital, and hybrid instruments always with the goal of making projects more attractive and financially viable.
In the Amazon, blended finance can be transformative
The blended finance model is particularly effective for enterprises in the Amazon’s bioeconomy value chains, enabling businesses led by women, Indigenous peoples, and traditional communities to grow with more stability and impact.
One example is NESsT’s support for sociobiodiversity cooperatives.
Photo: ASPROC
Associação dos Produtores Rurais de Carauri (ASPROC), located on the banks of the Juruá River, supports local riverine communities to produce and sell biodiverse products sourced exclusively from the rainforest, including pirarucu fish, manioc flour, natural rubber, and açaí. NESsT provided funding to ASPROC to support the renovation of a fish processing facility that had part of its structure compromised, enabling its rapid recovery and return to operation.
Additionally, NESsT's investments to Associação dos Trabalhadores Agroextrativistas da Ilha das Cinzas (ATAIC) and Associação dos Agropecuários de Beruri (ASSOAB) funded the opening a semi-industrial kitchen and a natural oil processing factory, respectively.. These investments in basic infrastructure helped prepare these community-based enterprises to access bank loans for working capital in the future.
Photo: CooperSapó
In the case of CooperSapó, business and governance support from NESsT played a key role in strengthening the cooperative’s management and enabling it to access new funding sources that require greater risk exposure.
When well-structured, the blended finance model helps transform promising initiatives into high-impact solutions, connect those in need of support with purpose-driven investors, and enable a forest-based economy that combines environmental preservation, social justice, and economic return.
To simplify the understanding of this mechanism, NESsT has developed an explanatory infographic that visually illustrates how blended finance works in practice and NESsT’s role within the impact ecosystem in the Amazon. The tool helps translate financial concepts into accessible language, making it especially useful for entrepreneurs, policymakers, partners, and anyone interested in understanding how to accelerate the development of the Amazon bioeconomy through innovative financing solutions.
Learn more about NESsT's work in the Amazon and how we are supporting sustainable businesses with innovative financial solutions.
Read the full report and discover NESsT’s recommendations to unlock funding for community-led bioeconomy in the Amazon:
Este blog forma parte de una serie que explora las ideas, los temas clave y los enfoques que impulsan la publicación de NESsTLiberar el potencial del ecosistema financiero mundial para invertir en una bioeconomía sostenible en la Amazonia desde la perspectiva de las comunidades locales".. Basado en las voces amazónicas y en conversaciones con la comunidad financiera mundial, el informe identifica nueve recomendaciones en dos áreas clave para que los inversores públicos y privados centrados en el impacto mejoren la orientación, la eficacia y la eficiencia de su financiación de la bioeconomía amazónica. A través de esta serie de diez partes, pretendemos llevar estas oportunidades a conversaciones más amplias y diversos espacios de debate, amplificando el alcance de las comunidades amazónicas y sus voces, experiencias y soluciones.
