In the Land of the Inkas

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Have you ever heard of sphagnum moss? Neither had we. Our team, FTMBA 2017 students Mitul Bhat, Katrina Gordon, Pan Lu, Hady Barry and Mostafa AbdelAziz, had the chance to explore this new world of small, absorbent, flowering plants through our Spring 2016 IBD project. We were assigned to work with Inka Moss, a Peruvian social enterprise, and one of its investors, NESsT, an early-stage impact investor, to develop a US go-to-market strategy for the sphagnum moss that Inka Moss collects and processes. Sphagnum moss is a highly absorbent type of moss that is used to grow specialty plants like orchids. It is used in its other forms as a soil conditioner, for decoration, or even as a natural water filter.

The “Moss” Diverse Team in IBD History

Inka_2 copyBetween ethnicity, nationality, languages spoken, professional experience, religious background, dietary preferences and sleep schedule, the members of our team were different in every way. This diversity in experiences and points of view made our experience quite unique!

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Exploring Peru

In an effort to get to know Peru before starting work, we arrived early to explore different parts of the country. We hiked Machu Picchu, checked out the glaciers of Huaraz, and challenged our bodies at elevations over 5000m (16,000ft) high. We also quickly learned we love Peruvian breakfasts and walking around the beautiful streets of Lima!

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Ceviche por favor!

In between working, we were able to discover the city and find what makes this beautiful place tick. To our surprise, food became a pivotal part of this trip. Lima is a culinary powerhouse, and the ceviche, Chinese fusion ‘chifa,’ sandwiches, meats and local fruits definitely made the long hours together and many revisions of our project so much easier.

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Getting Down to Business

We devised an elaborate plan to create a helpful strategy for our client, which meant our schedule was packed: defining target customers, developing positioning of products, creating a go-to market plan with detailed messaging, pricing, distribution, and marketing tactics, and finally an implementation plan to boot!

Day…

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…and Night!

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Highlands visit

To give us more context, our client arranged for us to visit Inka Moss’ production facility in the Highlands. We had to wake up at 5:30 am to catch a 7-hour bus ride from Lima to Jauja, but we were very excited to gain a better understanding of where the moss is grown and the collect, cleaning, drying and packaging processes.

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Most importantly, we had the unique opportunity to interact with the community and understand the impact that Inka Moss has had in the communities it works with. After spending one day in the community up on the mountain, the next day was filled with sharing and interpreting the information and insights from our trip, brainstorming on our next steps, getting to the bus station, and a 10-hour bus ride! The traffic was insanely bad, but we finished 5 movies, 2 books and caught up on 2 days of sleep. Success!

Down to the Wire

In the end, it was our mission to turn all our experiences into actionable insights and devise a holistic go-to-market presentation for Inka Moss to use to enter the US market.

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#doitforthemoss

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Happy client, happy team! As we presented to our client during our final presentation, our goal was to offer Marco insights and actionable next steps that would enable Inka Moss to hit the ground running. If you asked any of us four months ago what sphagnum moss was, we would have had little to say—but now we can’t stop talking or thinking about it!

 

Updates from IBD Peru and Chile – Team Bocadio Part II

Part II of Spring 2015 IBD Team Bocadio’s adventures working with Bocadio, an innovative, high-quality meal delivery startup in Latin America.

3 – On Getting a Phone

As we settled into our daily routine of data analytics and market sizing, it was clear that communicating with each other, and Diego, would require finding a dataplan. It was through this adventure that Christian and Steven discovered that Inventarte’s complex check-out process was perhaps simply indicative of a cultural difference we had missed: Peruvians enjoy processes. Indeed, as it turns out, securing a phone plan required no less than 12 steps:

The Twelve Labors of Claro

  1. Find the only store in Lima where you can purchase a SIM card for your phone from Claro, one of the major operators in Latin America
  2. Revisit the store a second time, as it is closed on the weekends
  3. Line up for a ticket, and explain purpose of visit in broken Spanish
  4. Realize you need your passport and the little immigration stub to accomplish most things in Peru
  5. Return to hotel to pick up passport
  6. Rush frantically back to the store, as it closes early
  7. Line up for a ticket, realize the person at the desk has changed, and explain again the purpose of visit in broken Spanish
  8. Wait to be called to a customer service counter and get a voucher for a SIM card
  9. Line up at cash register to pay for the SIM card itself
  10. Return to customer service counter to collect SIM card
  11. Line up at automated kiosk to add initial credit to phone
  12. Return to customer service counter, to activate phone
Claro - many phones but only one place to buy a SIM

Claro – many phones but only one place to buy a SIM

In the hotel lobby, Kayo had already secured her own dataplan, and was happily browsing away when Steven and Christian, having triumphed over Claro, returned sweaty and disgusting, but with chests stuck out like proud warriors bringing back in their pockets the spoils of their war. “Actually,” Kayo said, “for me it was very fast. Japanese Guide told me everything I needed to bring.”

On the inside, Christian and Steven wept.

4 – On Our Travels Outside Lima

In Steven and Ben’s absence, Kayo and Christian opted to use their weekend alone to travel outside of the city and see some of the country’s favorite sights. While forewarned by Japanese Guide of the challenges that lay ahead of them, they embarked upon a perilous 8-hour bus and car journey to Nazca, sight of the world-famous Nazca lines. Of course, travelling around the country is much easier today that it would have been in the time of the Nazca people. Thousands of years ago, it would have taken months to get from Nazca to Lima by llama whereas today, thanks to the way people drive, you are lucky to get there at all.

Whatever they may have felt, however, Kayo and Christian had no real choice: humans are hard wired to travel. Indeed, we travel because no matter how content we are at home, we yearn take new tours, buy new souvenirs, introduce ravenous new bacteria to our intestines, learn new words for “explosive diarrhea,” and have all kinds of other unforgettable experiences that make us want to embrace our beds when we finally get home.

Of course, none of this mattered once Christian and Kayo finally found themselves on the tarmac of the Nazca Aerodrome (Motto: “The only way to fly. No really, we mean it, there is nothing for hundreds of miles.”) awaiting their turn in the back of a tiny Cessna, the preferred method of viewing the ancient lines. Thankful that the very hearty breakfast they had enjoyed that morning was helping to keep them warm in the frigid desert, Kayo and Christian listened to the pilot’s instructions as they were strapped into their seats. “Oh and I hope you skipped breakfast this morning,” he concluded, “things can get pretty bumpy.” Christian opened his mouth to make a witty remark, but before he could, the minuscule aircraft shot into the air.

Happiness...

Happiness…

...and a little bit of anxiety -- just a bit

…and a little bit of anxiety — just a bit

Meanwhile in Santiago, Steven and Ben were helping Diego add a real-world lens to his market research. The goal of the visit was to better understand the market conditions and viability for starting a Bocadio branch in Santiago, and begin building relationships with investors and local operators who could one day help grow the business.

Our first day in Santiago, a Haas alumnus, and old friend of Diego, Koichi Arimitsu, had a dinner to welcome Diego, Steven and Ben to Santiago. Koichi shared his experiences as an entrepreneur in Chile, starting one of the first large-scale solar plants in the northern desert. Koichi explained that Santiago’s start-up community is growing quickly, and is heavily supported by a strong government infrastructure. Koichi also complained about the lack of delicious food, despite the wealth of incredible, locally grown ingredients (Chile’s top exports include Wine, Salmon, Avocados, Grapes, Apples, Pears, and Pigs). As Koichi explained, “they’ve got amazing ingredients, but have no idea how to prepare them!” In fact, Chileans avoid “Chilean” cuisine at all costs. What are the two hottest restaurants in town? Peruvian exports: Gaston Acurio’s Le Mar, and Ciro Watanabe’s Osaka.

Diego, Ben, and Steven were excited to hear that the market opportunity in Santiago was prime for a new, high quality, low cost food delivery service – especially one backed Peruvian chefs that could meet the demand of a growing middle-class that lacked in-home help.

Koichi's Texas-sized portion of Pork & Asparagus

Koichi’s Texas-sized portion of Pork & Asparagus

The second day in Santiago, Steven, Ben and Diego had lined up a number of meetings with potential investors, including another solar entrepreneur (Haas ’07), a family office who was responsible for bringing Papa John’s to Chile, and the head of Fundacion Chile (Haas ’06). The first two meetings went incredibly well, each investor indicating that Bocadio would do well in Santiago, and they may be willing to contribute to help fund its expansion.

Diego discussing the Bocadio concept with Haas alum Christian Sjorgen

Diego discussing the Bocadio concept with Haas alum Christian Sjorgen

Steven, Ben and Diego were over the moon with this feedback. Hearing from real investors in the flesh of Bocadio’s market potential helped validate the months of market research they had been conducting on the ground in Berkeley. Further, they began to realize that the idolization of Peruvian cuisine and lack of local flavors was unique to Santiago, and perhaps made it a better market to begin expansion when compared to cities with similar profiles (such as Bogota).

The third day, Diego had arranged a tour of Aramark’s largest food processing facility in Santiago. This plant was responsible for cooking and delivering hundreds of thousands of meals a year to mines scattered across the north and south of Chile. The plant tour would provide Diego a window into a state-of-the-art food production facility, and the techniques required to optimize cooking food & then chilling it for delivery at scale.

Walking through the factory floor, Diego, Ben and Steven got to see first-hand the incredible technology that made this type of food production possible – including a laser-cutting machine that could quickly dice any type of meat into uniform cubes, identical in weight, and a giant skillet that could cook hundreds of pounds of spaghetti with meatballs by simply loading the ingredients. While adding to the future wish-list of equipment, Diego, Ben and Steven were also able to have an insight that could be applied immediately – adopting a bar code scanning system that could trace the origin of each meal, allowing for better insights throughout the supply chain.

Visiting Aramark's Plant

Visiting Aramark’s Plant

Ben and Steven taking advantage of the weekend in Santiago on horseback through the Andes

Ben and Steven taking advantage of the weekend in Santiago on horseback through the Andes

Showing some school spirit

Showing some school spirit

 

Updates from IBD Peru and Chile – Team Bocadio Part I

Berkeley-Haas Full-time MBA students Benjamin Geller, Steven Truong, Christian Kaas and Kayo Inoue worked with Peruvian food delivery startup “Bocadio” to launch the business in Lima, and craft a plan for expansion throughout Latin-America. Bocadio combines technology and gastronomy to provide high-quality meals delivered quickly at a low price-point. Originally our goal was to help Bocadio in its initial month of operation in Lima, while researching opportunities for international expansion. However, upon landing we realized that construction on the kitchen had been delayed. With this impetus, we refocused our project on preparing the Bocadio team for a successful Beta period when the kitchen completed in August, and investigating international expansion in Santiago, with Steven and Ben joining Diego for one week to meet with investors and operators.

1 – On Arriving in Peru

While the team left Berkeley at 4am, it was already night time when we arrived in Lima, excited to begin our IBD adventure with Bocadio, the latest addition to the city’s thriving food scene and the local analog to the Bay Area’s successful Munchery concept.

Making our way through the airport towards baggage collection, Steven saw an excellent opportunity for us to get started on one of the most important parts of our project. “Guys, we need to take a picture for our blog!” If I had even been irritated by tourists’ propensity to photograph themselves in the inane and inconvenient of settings, I can now sympathize that they must simply be collecting material for their IBD deliverable. This picture of us happily holding up foot traffic in-front of the Jorge Chavez International Airport international arrivals’ women’s lavatory can attest to this.

Arrival in Lima

Arrival in Lima

Exhausted by our trip, we were happy to have arrived a day early and to have Sunday off to discover Lima. Our first challenge was an important one, particularly given our project context: where do we eat? TripAdvisor raved about a local joint Haiti Haiti Café that was, rather interestingly, neither Haitian nor really a café. Proud of our first foray into the local culinary scene, we would later tell our client team about Haiti Haiti and how happy we were with our discovery. “This is not a good place to eat,” the team grimaced. Surprisingly, it turns out that hotdoggurl_345 from Skokie, Illinois is a poor assessor of Peruvian cuisine. Who knew?

First lunch in Peru - they love their potatoes

First lunch in Peru – they love their potatoes

Another wonderful meal - we were making a habit of this

Another wonderful meal – we were making a habit of this

While Steven and Christian put their extensive experience with the Spanish language and mime to communicate important things like “beer” or “fork,” Kayo seemed to be faring altogether better with her guidebook, sadly impenetrable for mere mortals, which we came to know affectionately as Japanese Guide.

Japanese Guide, or why Kayo always knew more than we did

Japanese Guide, or why Kayo always knew more than we did

2 – On Meeting Diego

Monday morning was our first meeting with Diego, who came to meet us at our hotel. Diego’s little yellow car shot through Lima traffic like a pinball, with team Bocadio in tow. “Don’t be afraid if I’m driving a little bit crazy, eh,” said Diego, elbowing his way across three lanes of traffic to catch a late turnoff, “it’s just the way you need to do things around here.” Some pink returned to our knuckles as we partly unclenched our grip our Diego’s car seats. Diego’s car would later feature in one of my dreams, with a rocket attached to the back, like a bright yellow Batmobile.

In record time, therefore, we found ourselves at Bocadio’s new office, nested above a little café in the upscale residential neighborhood of San Isidro. We enjoyed meeting so many of the people who – up to now – had only been names on an e-mail chain: Mauricio, Alex, Willy and Laura. Also present on our first day was Coque Ossio, one of Diego’s principal backers and owner of, we have come to suspect, pretty much every restaurant in Peru. Upon finding us setting up shop in a bakery near our hotel, Diego remarked “how do you like the Bonbonnière, it belongs to Coque, you know.” The restaurants at Lima airport? Coque. This celebrity connection greatly entertained us, of course, and Steven enjoyed introducing us everywhere we went as friends of Coque. Often, people would nod enthusiastically, either recognizing the name of one of the country’s great chefs, or thinking Steven was crazy. My money is on the latter.

Diego's yellow car

Diego’s yellow car

We then had the opportunity to sit down with Bocadio’s head chef at Coque’s restaurant across the street, and perform the arduous task of taste-testing potential items for the menu. We were struck by the vibrancy of flavors, and the different uses of potatoes in the dishes – who knew that Peru had over 3,000 varietals! We knew at this point that Bocadio had a dynamite product, which was great to experience first-hand.

Bocadio team member Mauricio helping serve up our first tasting

Bocadio team member Mauricio helping serve up our first tasting

 

Alex Riccio, one of Bocadio's main chefs, and a Munchery alum

Alex Riccio, one of Bocadio’s main chefs, and a Munchery alum

The team working hard

The team working hard

Happy campers pose with Chef Alex

Happy campers pose with Chef Alex

 

But back to Bocadio. One of our first tasks was to accompany Diego to meet Inventarte, his website production team, to review their progress and offer some suggestions for user-centric design based on our extensive experience of the one class Ben took on the subject. One of the main observations we made that day was that the check-out process for new users seemed overly complex, to the point of being potentially off-putting for new customers. In a similar vein, much of this first meeting focused on reducing the complexity of the Bocadio sales funnel, to make the ordering process as pleasant an experience as possible.

Reviewing the progress on the website

Reviewing the progress on the website

At the end of our first day, Diego dropped us off at one of Lima’s best-known Cevicherias, renowned for their modern interpretation of Peru’s ceviche, raw fish seized with lime juice. “The restaurant is great, but not in the best part of town,” Diego said. “Don’t leave this street.” Ben turned around to ask if he would like to join us “Dieg…”

But he was gone.

Like Batman.

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“I’m Batman.”

Stay tuned for part 2 of Team Bocadio’s adventures…

Updates from EWMBA IBD – Team ProNaturaleza

Berkeley-Haas Part-Time MBA students Joe Bass, Mayhul Jain, Chidananda Khatua, and Hideaki Oshima participated in a summer IBD project in Peru with the nonprofit organization ProNaturaleza.

Quick background: Our project was about a nut that is grown on the Yarina Palm tree in the Amazon rainforest. The name of the nut is Tagua and it has an ivory like hard feeling to it; Tagua is commonly used to create jewelry.  The non-profit organization that we were working with, ProNaturaleza, was attempting to determine what new products could be created out of this nut to be sold to the US market and elsewhere eventually.

After taking a visit to Machu Picchu and checking out other sights in Peru, we were excited to start the project! To learn more about the plant, the people and the infrastructure, the first week was spent in Iquitos, the gateway town to the Peruvian Amazonian Basin. It began with a chance encounter with Lisa Ling at the Iquitos airport who was working on a documentary on local hallucinogens – we think!

IMG_0784Joe, Chida and Hideaki at Machu Picchu

IMG_20140708_123617Joe’s hand, Hideaki, Chida, and Mayhul with Lisa Ling

In Iquitos, a town connected to the outside world only by river or air, we were able to visit a factory that processes Tagua nuts into buttons but was currently shut down due to unmet financial commitments.  We then visited the drying plant to learn how these nuts were dried – turns out it’s the old school method of a big cement slab and baking sun.  Perspectives are different everywhere and this was true on our factory visit as well.

DSC_0132Tagua Nut factory in Iquitos

However, the most interesting part of the Amazon visit was a trip to Pacaya Samiria National Reserve, one of the largest reserves in South America.  The trip to the national reserve consisted of a two hour bus ride and then a three hour canoe ride to the ~150 person village of Viente de Enero.  Though there was no running water and no steady electricity in this village in the middle of the rainforest, we were able to watch the World Cup semifinal match between Argentina and Netherlands in a local person’s hut thanks to his generator – the man had his priorities straight!

In meeting the locals and seeing their homes, it was evident that this was a simple life with chickens running around and huts constructed primarily of straw and natural materials.  In the evening, the kids would play football and the community would hang out; the village even had their hut version of a discoteca, which would play music till 6am in the morning.  Their entire livelihood consisted of picking Aguaje and Tagua from palm trees and fishing in the local waters, and selling these raw materials to the larger towns down river.

IMG_1065At Veinte de Enero Village

DSC_0194With the locals at Veinte de Enero, Pacaya Samiria National Reserve

DSC_0238The school had no running power, but they did have laptops for their students- that was great to see!

The next morning we went on a short jungle walk to see how the Tagua nut was harvested. With machete in hand, our local guide led us on another canoe ride within the Reserve where we were able to walk around the dense and beautiful jungle. Lesson learned – New Balance tennis shoes don’t do the job for jungle walks!  Especially when the guide tells you that there are four types of venomous snakes in the area where the Tagua nut is harvested. This put things in perspective though – for these local villagers to even make a few bucks requires putting their lives at risk everyday. We heard multiple stories of being bitten by snakes.

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DSC_0205Harvesting the Tagua Nut with our local guide Carmelo

After returning to Iquitos, we were able to kiss a pink river dolphin and feed Amazon manatees at a rescue center.  We also visited a local market where people from across the Amazon visit in an attempt to search for organic glue, which we were able to eventually find. While looking for this glue, we also saw both legal meat as well as illegal meat (spider monkey, turtles, tapirs, sloths) for sale, which speaks volumes about the tough job that law enforcement has protecting the local species.

In embracing the Berkeley-Haas Defining Principle of “Student Always,” we not only learned about the Peruvian Amazonian people and the Tagua nut, but also came to the realization that the Amazon basin has an incredible amount of sustainable economic potential – be it through eco-tourism, harvesting fruits or nuts, or fishing.  The next step is to just unlock it!

Team ProNaturaleza: Opportunities Abundant in Paracas, Perú

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Team ProNaturaleza – Katie McMahon, Adam Selvin, Priyal Sheth, and Michelle Verwest – are in Peru consulting for ProNaturaleza, one of the largest and most successful Latin American NGOs focused on environmental conservation.  Our project is centered on the Interpretation Center (i.e., visitor/guest center) of the Paracas National Reserve, a natural protected area located on the southern Pacific coast of Peru, approximately 250 km south of Lima.  The main purpose of the Paracas National Reserve is preservation of the marine ecosystem of over 1,500 species and historical cultural heritage of the area.  In addition to a business plan, we will evaluate the economic viability of ProNaturaleza operating the Interpretation Center with the government and propose a business model for replication to other national reserves in Peru.  A long-term goal of our client is to generate a profitable revenue stream to reduce dependence on private funding while promoting conservation in Peru’s important, valuable, and beautiful ecosystems. 

¡Buenas Tardes de Perú! 

Team ProNaturaleza has had a busy week evaluating ecotourism in the Paracas region of Peru!  As of the end of this week, we have conducted many interviews, including interviews with the Head of the Paracas National Reservel (‘El Hefe’), managers of three four- and five-star hotels located in the Bahía de Paracas, and representatives from a local fishing village in the Paracas National Reserve.

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Insights from El Hefe

Paracas National Reserve is managed by the Peruvian government entity SERNANP (Servico Nacional de Areas Naturales Protagdes por el Estado).  An eye-opening interview with the head of the reserve provided valuable insights to working with the government.  With a limited budget for operating the reserve, El Hefe candidly shared the difficulties of managing 335,000 hectors of protected land and sea area with limited resources.  The reserve’s rules are difficult to enforce, especially with little support from local police and cooperation from visitors.  It is extremely difficult for reserve management to make decisions without buy-in from the head SERNANP office in Lima and plans are executed at a snail’s pace.  The reserve’s understaffed operations allow minimal resources dedicated to the Interpretation Center, explaining the underutilized enclosed area of the center, broken exhibits and displays, unmaintained facilities, and lack of tourism offerings and services for visitors.  Government oversight, requirements, and timing will be key considerations for ProNaturaleza as they negotiate a contract with the government to operate the Interpretation Center, a viable proposal that clearly makes sense given the center’s under-utilization and complete lack of revenue generation.

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Hotel Operators Optimistic

The interviews with the hotel operators concluded that tourism is thriving in the Paracas area, yet there remains enormous potential for growth in ecotourism services and offerings in the Paracas National Reserve.  Hotels are consistently at or near 100% occupancy during high seasons and on the weekends.  A new four-star hotel is under construction and set to open in October before a large conference in the area in November – all hotels are completely sold out for the conference and during most weekends during the summer.  Tourism growth is optimistic with demand trending upward.  We discovered the average daily spend at the hotels is a significant multiple over the daily spend of the average tourist at the Paracas National Reserve, indicating an opportunity to increase the average spend through robust tour offerings and services in the Paracas National Reserve from the Interpretation Center.

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Lessons in Conservation, Continued

A shocking realization came to light with a visit to a local fishing village in the national reserve.  With several fishing villages grandfathered into the reserve’s protected area charter, the relationship between some of the local fisherman and the reserve is strained due to historical fishing practices that do not contribute to sustainability or conservation, including fishing with dynamite and in unauthorized areas.  While exploring one of the reserve’s many secluded beaches, Team ProNaturaleza came across two dead sea lions on the beach.  Our assigned expert conservation consultant, Luis Rios, speculated that the sea lions died due to unnecessary force and beating from the fishermen when the sea lions became stuck in their fishing nets.  This heartbreaking story led us to think about opportunities in which the Interpretation Center could provide outreach programs educating the fisherman on sustainability and conservation best practices to coexist peacefully with existing marine life.  There is also opportunity for the Interpretation Center to involve local fisherman in tourism, thereby driving spending and increased wealth to their communities.

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Tourists Ourselves!

We were able to put ourselves in the shoes of the Interpretation Center’s future visitors by playing tourists ourselves!  We have enjoyed exploring the vast and beautiful Paracas National Reserve, its culture, birds and marine animals, beaches, cliffs, and natural overlooks.  Touring the Ballestas Islands via boat, we viewed the unique and abundant marine life, noting that the tour operators navigated too close to the sea lions and penguins to be within the legal limits as defined by the government – another conservation issue to note that ProNaturaleza could potentially help alleviate through education and outreach.  It has been especially enjoyable to research and indulge in the many culinary offerings of the Bahía de Paracas, including the absolute freshest ceviche, seafood, shellfish, octopus, and the famous Pisco Sour!  ¡BUENASASO!

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Team ProNaturaleza returns to Lima tomorrow looking forward to an important meeting with the head of SERNANP on Monday and an eventful and productive week in the ProNaturaleza offices!

¡Chao… Hasta Luego!

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