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Entrepreneurs might just be the answer to global poverty

POSTED: June 25, 2014 8:00 a.m.
Aaron Thorup, Kauffman Index of Entrepreneurial Activity, Global Entrepreneur Monitor, and For/

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Jeff Hoffman, the founder and former CEO of Priceline.com, decided to take a year to say yes. It was an experiment to see what would happen if for one year — to the best of his ability — he responded to anyone who asked him for help.
His responses led him to cities and villages around the world, and that's how he ended up in Senegal with a 19-year-old young man who wanted to give him a business pitch.

The slick slide show and smart ideas were on par with presentations Hoffman had seen and heard in Silicon Valley, London or Harvard University. But this time he was sitting in a hut with a dirt floor and a goat bleating outside.
"Where did you learn how to do this?" Hoffman asked.

The young man had never left Senegal. Every night, after he worked in the fields, he took free online business classes from Stanford on Coursera. He learned how to present by watching TED Talks. He used free software from Slideshare, and had studied the 10 best investor pitches.

"That's how I found you," he said. "I emailed you after I found you on the Internet."
The point of the story, Hoffman said, was that the kid in Senegal could not have existed 10 years ago. "He could only have existed in the last two or three years, thanks to the democratization of information," said Hoffman.
Hoffman offered this story at the Global Accelerator Conference at the United Nations last week, a gathering of top entrepreneurs and high-ranking United Nations Foundation officials with a big idea of their own — using entrepreneurship taking root in remote areas of the world to address global development and poverty.

In the United States alone, almost half of all new jobs in the past 30 years have been created by firms that are less than five years old, according to the global entrepreneurship GEDI index, and globally, 65 million entrepreneurs each plan to create 20 jobs or more in the next five years. Many of these startups offer innovative products that are new to the market, according to a GEM report.

Supporting entrepreneurs isn't just about bringing new products to market, though, as far as Hoffman is concerned. He sees enterprising, business-minded young people pulling themselves and their communities out of poverty. We have the ability now, he says, to deliver tools and resources to "every little village on the planet so every kid can change the future of his nation."

Risk and reward 
High-risk entrepreneurs and bureaucratic U.N. officials might seem like a strange combination, but applying the problem-solving of a startup culture to global development is the idea, said Michael Dell, who spoke at the meeting via video call.
Dell was announced as the new United Nations Foundation global advocate for entrepreneurship at the meeting, a position that advocates for technology and innovation with policymakers and world leaders.

“Part of what we’re trying to do is sort of raise entrepreneurship to the level of the public policy agenda,” said Dell. “If you look at what’s going on in the world today, in terms of where jobs are being created, we need more entrepreneurs. We need more risk-taking."

More than 565,000 small businesses start each month around the globe, and the innovations and consumption they drive could be key to the recovery of the world economy as they create jobs, more global disposable income, and new products, according to Kauffman Index research. But only 15 percent of entrepreneurs say their country's culture supports entrepreneurs, according to ey.com.

At Tuesday's conference, the room was filled with 100 successful risk-takers from around the world who would like to kickstart the startup mentality in developing countries, including innovators like Neil Blumenthal of fashion eyewear company Warby Parker, producer and talent manager Troy Carter, and Tina Wells, founder of Buzz Marketing Group. Most were under age 45.
"Technology has enabled underserved communities to get out of poverty," said Ruma Bose, an entrepreneur, investor and philanthropist. "In the slums of India we saw a lot of hope and magic, there are thousands of new businesses there, and factories that generate millions in revenue and provide clean water. Even in the worst conditions the entrepreneurial spirit exists."

Pitching for change
Saba Gul, CEO and founder of the handbag company Popinjay, presented how her company's handbags are not only available through high-fashion retailers like Nordstrom and Anthropologie, but they provide Pakistani women with livable wages. Gul trains and employs 150 women artisans, who work four hours a day for about $3 an hour — a fair wage in that economy, says Gul.
Popinjay came about when Gul, an MIT graduate who grew up in Pakistan, was inspired by the story of Azaada Khan, a girl who grew up in a Taliban-ruled village in Afghanistan and dressed as a boy for 12 years so that she could go to school.

"What did I really do to deserve to be here?" Gul asked herself. So, she left her job as an engineer and went back to Pakistan.
“When I started Popinjay, my goal was really to get women to sustain themselves, but what I realized over time is that it wasn’t just about the money,” Gul said. “It was also about the fact that they gained so much dignity and pride in knowing that they were creating something with their own hands."

Likewise, Christopher Ategeka's startup has a model that helps people become self-sufficient but also provides a public service. He pitched his venture, CA Bikes, that makes bike ambulances to help save lives in rural places in Africa. The drivers of the bikes "ride-to-own" their ambulances to support themselves; it's a model that he calls "pulling entrepreneurs out of poverty."
Ategeka was looking for $500,000 in investor capital, and had already received some pledges before the day was out. "What I like is that this is a business that directly saves lives," Ido Leffler, co-founder of the Yes To line of natural skin care and beauty products, and one of the event organizers, said of Ategeka's pitch.

Developing countries are growing faster than rich ones, so savvy innovators are looking to market in up-and-coming countries like Brazil, China and India with emerging middle classes, but event organizers were quick to point to other reasons for promoting global innovation.

"Being an entrepreneuer is not just about making money, it's about creating change," said Leffler.
The idea that entrepreneurship is primarily about getting ahead or making Silicon Valley millions is an idea that Hoffman tried to dismiss as well — instead trying to emphasize the impact a startup can have on an individual life as well as a community.

"My whole life has been an adventure that I never dreamed of, brought to me by entrepreneurship," said Hoffman."I feel like I'm even more tasked with making that possible for others."
When he met the young would-be entrepreneur in Senegal, Hoffman told him: "I'm here to help you." But in the spirit of entrepreneurism, the young man wanted to find his own way.
"I want you to teach me to help myself," he said. "I want to never have to call you again."

Email: laneanderson@deseretnews.com

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