Impact Investing and Venture Capital Financing: The Case of Tunceli-Ovacık Natural Products Cooperative

Tunceli-Ovacık Natural Products Cooperative is an initiative operating in the Tunceli province of Turkey in the production and sale of natural products to the country. The initiative is an example of an impact investment that creates significant employment and provides consumers with access to natural and reliable food through the correct and conscious allocation of public resources.

Importance in terms of Impact İnvestment :  In 2014, the mayor elected in Ovacık, a small district of Tunceli province, decided to expand the production of the region's famous chickpeas and beans with clean seeds and sell them throughout Turkey in order to develop the district's economy and provide employment. First, the municipality rented lands belonging to the treasury and produced 15,000 kg of chickpeas and beans with limited local seeds. It set aside the vast majority of these products as seeds. The remaining part was sold on the internet platform they created in a short time. The following year, farmers in villages affiliated to the district were trained on organic production. They encouraged farmers by providing free seed and fuel support to willing small farmers. In the second year, 150,000 kg of chickpeas and beans were produced, excluding seeds. The products produced were sold in a short time. In the following years, the initiative was transformed into a cooperative. The initiative, which started with chickpea and bean production, expanded by including other agricultural and livestock products specific to the region (organic honey, red mullet, cheese, jam, molasses, marmalade, beverages, flour, etc.). Currently, the initiative has thousands of producer members and branches have been opened in all major cities of Turkey.

Why It’s Best Practice:  The fact that a small district municipality sets an example for farmers by creating a small fund from its limited resources and generally providing natural production of products specific to the region with solidarity and selling them via the internet platform in a short time; then encouraging small farmers by raising awareness of natural production, providing seed and fuel support, and guaranteeing sales through the municipality, and providing significant improvement in the employment and economy of the region, makes it an important example of impact investment. Tunceli-Ovacık Natural Products Cooperative has become a reliable natural food brand known by consumers in Turkey.

Key Lessons Learned:

1. Small but correctly and consciously used public funds can create significant impacts.

2. An initiative started with a small public fund can turn into an initiative with thousands of members and can make significant contributions to the employment and economy of the region.

3. An initiative established with a small fund can produce thousands of regional products and provide millions of consumers with access to safe food.

4. A portion of the income from the initiative can be used to create an education fund and provide social development by providing access to education for children from poor families.