The World Bank Mobile Innovation Project under EPIC (P132570) REPORT NO.: RES30067 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF MOBILE INNOVATION PROJECT UNDER EPIC APPROVED ON JULY 10, 2014 TO UNIVERSITY OF WEST INDIES TRADE & COMPETITIVENESS LATIN AMERICA AND CARIBBEAN Regional Vice President: Jorge Familiar Calderon Country Director: Tahseen Sayed Khan Senior Global Practice Director: Anabel Gonzalez Practice Manager/Manager: Ganesh Rasagam Task Team Leader: Toni Kristian Eliasz The World Bank Mobile Innovation Project under EPIC (P132570) ABBREVIATIONS AND ACRONYMS The World Bank Mobile Innovation Project under EPIC (P132570) BASIC DATA Product Information Project ID Financing Instrument P132570 Investment Project Financing Original EA Category Current EA Category Not Required (C) Not Required (C) Approval Date Current Closing Date 10-Jul-2014 30-Nov-2017 Organizations Borrower Responsible Agency University of West Indies University of the West Indies Project Development Objective (PDO) Original PDO The Caribbean Mobile Innovation Project (CMIP) aims (1) to strengthen the Caribbean mobile innovation ecosystem and (2) to enable sustainable and competitive mobile enterprises to grow. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net TF Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-17431 17-Jul-2014 17-Jul-2014 17-Jul-2014 30-Nov-2017 1.50 1.42 .08 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Mobile Innovation Project under EPIC (P132570) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Description 1. The objective of the Caribbean Mobile Innovation Project is to strengthen the Caribbean mobile innovation ecosystem and to enable sustainable and competitive mobile enterprises to grow. The target beneficiaries of the project are mobile app innovators, aspiring and existing entrepreneurs from CARICOM region. 2. The project model is based on supporting and coordinating activities in locally based startup ecosystem hubs and the project consists of training courses, mobile app competitions, and support to promising entrepreneurs to launch their products, strengthen their market share and investment readiness. 3. The Caribbean Mobile Innovation Project was initially designed as a 40-month project under the Entrepreneurship Program for Innovation in the Caribbean (EPIC). The implementing agency, UWI Consortium, has been provided a grant (TF017431) by The World Bank Group on behalf of the Government of Canada in the amount of USD 1,500,000. The project implementation period commenced July 17, 2014 with a scheduled closing date of November 30, 2017. 4. The proposed change to the project is an extension of the grant closing date from November 30, 2017 to November 30, 2018. The requested extension is to ensure that UWI Consortium has adequate time to implement all the components of the project and meet the project objectives. B. Project Status 5. To date, the Caribbean Mobile Innovation Project has achieved most of its deliverables in accordance with its annual agreed work plan and has received 94.67% of the grant funding. The last disbursement of USD 259,428 was made on November 17, 2017, which includes an advance for the projected expenditures over a six-month period. UWI Consortium has provided a detailed budget for the extension period and has offered to support the project with in-kind resources, including additional personnel needs, where necessary. With the extension of the grant closing date, UWI Consortium will be able to complete the remaining agreed deliverables and disburse the remaining available balance. Some of the results achieved by the project from inception to date are listed below: (a) Entrepreneurs have commercialized 36 products and have achieved a cumulative total of USD 523,666 amount of investments raised and USD 387,023 of additional sales revenue. (b) 92% of the entrepreneurs have been satisfied to extremely satisfied with the project services, according to a satisfaction survey conducted by UWI Consortium to three cohorts of the mobile app competition entrepreneurs. (c) UWI Consortium appointed 4 mHubs across the region to support local entrepreneurs. Based on an assessment, all the mHubs agreed that participation in the project increased the technical capacity and visibility of their organizations, and improved the quality of support services provided to entrepreneurs. (d) To ensure the sustainability of the services, University of the West Indies is taking steps to incorporate several project activities and services into a highly strategic innovation and entrepreneurship initiative for UWI (UWIC Innovation Ventures). 6. The financial management performance of the project has improved after necessary personnel changes. The project is being executed in compliance with the World Bank’s policies and procedures and is in good standing with FM and all other fiduciary areas. In particular, the last audit submitted covered the 18th month period ended July 2016, and the Bank has granted a longer audit period, which should cover the period August 1, 2016 to November 30, 2017 (the original closing date). UWI Consortium has indicated that the audit will be conducted by the Auditor General’s Department of Jamaica. The audit will be due by March 31, 2018. In addition, the Senior Procurement Specialist has cleared the revised procurement plan. The World Bank Mobile Innovation Project under EPIC (P132570) C. Rationale for Restructuring 7. The proposed extension would allow sufficient time for the recipient to monitor and collect results data from target beneficiaries to properly capture the growth in revenues, investments and employment attributable to the project, and complete the implementation milestones. In addition, an extension of the project closing date would ensure the budget will be fully disbursed. Remaining deliverables include: (a) Provision of remaining incubation support to PitchIT Caribbean cohort 3 winners (including investment readiness training and demo trek activities); (b) Launch of an Alumni Network and digital promotion of PitchIT winners; (c) Coordination of Knowledge Sharing event with CMIP stakeholders; (d) Participation at SLUSH 2017 conference Global Impact Acceleration program; (e) Completion of the service integration into UWIC Innovation Ventures to ensure sustainability, including the finalization of the program document and business model; and II. DESCRIPTION OF PROPOSED CHANGES D. Closing Date 8. This will be the first extension of the project. Proposed change is to extend the current closing date by 12 months from November 30, 2017 to November 30, 2018. This extension was requested by the UWI Consortium. E. Results Framework 9. The results of the project to date indicate that that some key assumptions used for the initial framework targets were too optimistic and should be adjusted to more realistic levels. It was also discussed with the Recipient that after two of potential mHubs did withdraw their interest in joining the project, rather than adding two new mHubs, the recipient should invest more resources to integrate the project activities into the broader UWI innovation and entrepreneurship agenda within the Caribbean. Updates to the results have already been discussed and agreed with the donors when the overall EPIC MDTF results framework was revised. For the Caribbean Mobile Innovation Project, the changes to cumulative target values include the following indicators: (a) IT/ITES Revenue: from USD 2,509,099 to USD 500,000; (b) Investment raised: from USD 1,626,917 to USD 500,000; (c) CMIP Reaching Financial Sustainability Targets: from 49% to 25%; and (d) mHubs Established by CMIP: from 6 to 4. F. Institutional Arrangements 10. Initial assumption was that CMIP would have been set-up as a separate legal entity during the grant period. However, as UWI expressed interest in integrating select services and activities into the UWIC Innovation Ventures initiative it was proposed that instead of a project advisory board the Recipient will invite strategic advisors to assist with the integration. Thus, there was no need for an advisory board, and it is proposed that this clause will be removed from the Grant Agreement. The World Bank Mobile Innovation Project under EPIC (P132570) III. SUMMARY OF CHANGES Changed Not Changed Change in Results Framework ✔ Change in Loan Closing Date(s) ✔ Change in Disbursement Estimates ✔ Change in Procurement ✔ Change in Implementation Schedule ✔ Change in Implementing Agency ✔ Change in Project's Development Objectives ✔ Change in Components and Cost ✔ Cancellations Proposed ✔ Additional Financing Proposed ✔ Reallocation between Disbursement Categories ✔ Change in Disbursements Arrangements ✔ Change in Overall Risk Rating ✔ Change in Safeguard Policies Triggered ✔ Change of EA category ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Financial Management ✔ Other Change(s) ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_RESULTS_TABLE RESULTS FRAMEWORK Project Development Objective Indicators PDO_IND_TABLE IT/ITES Revenue (US$) Unit of Measure: Amount(USD) Indicator Type: Custom Baseline Actual (Current) End Target Action The World Bank Mobile Innovation Project under EPIC (P132570) Value 0.00 387023.00 750000.00 Revised Date 17-Jul-2014 30-Sep-2017 30-Nov-2018 IT/ITES Employment (number of people) Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 80.00 416.00 Revised Date 17-Jul-2014 30-Jun-2017 30-Nov-2018 Investment Raised Unit of Measure: Amount(USD) Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 523666.00 500000.00 Revised Date 17-Jul-2014 30-Sep-2017 30-Nov-2018 Sustainable startups created Unit of Measure: Amount(USD) Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 0.00 24.00 Revised Date 17-Jul-2014 30-Jun-2017 30-Nov-2018 Intermediate Indicators IO_IND_TABLE Startup teams receiving services Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 266.00 100.00 No Change Date 17-Jul-2014 30-Jun-2017 30-Nov-2017 Level of satisfaction by startups of CMIP services Unit of Measure: Percentage Indicator Type: Custom The World Bank Mobile Innovation Project under EPIC (P132570) Baseline Actual (Current) End Target Action Value 0.00 0.00 75.00 No Change Date 17-Jul-2014 30-Jun-2017 30-Nov-2017 Applications received through mobile competitions Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 513.00 400.00 No Change Date 17-Jul-2014 30-Jun-2017 30-Nov-2017 CMIP Reaching financial sustainability targets Unit of Measure: Percentage Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 0.05 25.00 Revised Date 17-Jul-2014 30-Jun-2017 30-Nov-2018 mHubs established by CMIP Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 4.00 4.00 Revised Date 17-Jul-2014 30-Jun-2017 30-Nov-2018 OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline TF Status Closing Closing(s) Closing for Withdrawal Applications TF-17431 30-Nov-2017 30-Nov-2018 30-Mar-2019 OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE DISBURSEMENT ESTIMATES Change in Disbursement Estimates The World Bank Mobile Innovation Project under EPIC (P132570) Yes Year Current Proposed