Ana Escalante's blog

Unclogging the Water and Sanitation Crisis

Ana Escalante — Fri, 01 Feb 2008 16:04:23 -0500

Safe tap water is a luxury that many people in the world do not enjoy. In many developing countries, it is not safe to drink or use the tap water. The Center for Disease Control website of the United States government has health information about every country in the world, and it’s interesting to see how many countries fall under the advice: "Drink only bottled or boiled water, or carbonated (bubbly) drinks in cans or bottles."

Bottled water is expensive, of course, and people living at the BoP often cannot afford it. World Resources Institute’s research in The Next 4 Billion: Market Size and Business Strategy at the Base of the Pyramid showed that low-income customers pay anywhere from eight to sixteen times more for bottled or trucked water than they would for a local, public utility (page 58). If this isn’t a BoP penalty, then I don’t know what is.

Access to clean drinking water is a concern world-wide – but it is not the sole responsibility of government to provide it. The Next 4 Billion report concluded that there is a clear willingness to pay for clean water in the BoP. However, even if there is a willingness to pay, access to such services is not widespread, especially in rural areas. What the world needs are effective and innovative ideas on how to get these services to the people in the BoP, and to deliver them. Ashoka’s Changemakers has partnered with The Global Water Challenge to launch a collaborative competition to discuss and discover new solutions:

"Global Water Challenge is dedicated to finding solutions to the water and sanitation crises. We believe that we have both the resources and the will to live in a world in which everyone can drink clean water, and use a safe toilet. It is our goal to find and encourage ideas and individuals, wherever they may be, so that every school, every clinic, every home, every community, without regard to geography and income, has access to these basic needs."

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Echoing Green's 2008 Fellowship - Apply Now

Ana Escalante — Fri, 16 Nov 2007 06:41:50 -0500

Echoing Green is an angel investor for entrepreneurs focused on social change. I wrote about a couple of their 2007 fellows earlier this summer. They provide seed funding and support to entrepreneurs with innovative ideas for social change.

As an angel investor in the social sector, Echoing Green identifies, funds, and supports emerging leaders around the world and the organizations that they launch. Echoing Green has a two-year fellowship program, in which they identify social entrepreneurs that develop new solutions to social problems. They are currently accepting applications for the 2008 fellowship, for which 20 social entrepreneurs will be selected. Fellows will receive up to $90,000 to fund sustainable solutions to social problems.

I'd like to encourage our readers to make a contribution on innovative social change by applying to the fellowship and contributing with their groundbreaking ideas. As Jeremy Schifeling from Echoing Green says

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Hard Questions for Microfinance: How Much Profit is Too Much Profit?

Ana Escalante — Tue, 16 Oct 2007 08:50:18 -0500

Microcredit is generally considered a step forward in the war against poverty. Giving small loans to impoverished people helps transform lives – read the annual report of any MFI for details. While I am a firm believer that microfinance is a good thing, does it remain "good" when the people who are lending start making huge profits?

I have been following discussions inside the microfinance field, specifically regarding the Compartamos IPO.

"Carlos Danel and Carlos Labarthe, the CEOs of Compartamos, a nonprofit-cum-commercial bank which charges an annual interest rate of nearly 100 percent, believe that only the lure of profits will motivate people to lend to the poor. Today Compartamos reaches 700,000 borrowers and 88 percent of its clients come back for more loans. In 2006, it was rated as Mexico's most profitable bank”

via PSD blog and iPienso. I also read the Microfinance Gateway reports from CGAP and Microcredit Enterprises. These reports caused me to reflect upon the debate, and I came to the following conclusion: while poor people are in need of credit and willing to pay high interest rates, that in and of itself doesn’t justify charging such rates and earning huge profits out of them.

Compartamos started in 1990 as a non-profit organization lending small amounts of money to indigenous Mexican women. Today, Compartamos has turned into a giant, for-profit bank with more than 600,000 clients. Compartamos' transition from NGO to for-profit bank sparks controversy – while many indigenous women in Mexico are grateful for the programs, now the bank is targeted by critics. Among these critics are Chuck Waterfield, Jonathan Lewis, and Mohammad Yunus - Nobel Prize winner and pioneer of microfinance.

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Microsoft: Enabling Social and Economic Development in Digital Age

Ana Escalante — Fri, 12 Oct 2007 15:03:45 -0500

Yesterday, I attended "Unlimited Potential: Connecting the Next Five Billion," a presentation organized by SID-Washington's Corporate Responsibility Workgroup, USAID's Global Development Alliance, DAI and Georgetown University's Mortara Center for International Studies. The presentation featured Microsoft’s Unlimited Potential Group and was hosted at the Academy for Educational Development (AED). In short, it was a brief on Microsoft's strategy for addressing the BoP and it was very insightful.

Michael Rawding, Vice President of MS's Unlimited Potential Group, delivered the speech. He explained in detail about Microsoft’s BoP strategy. I found interesting that the Unlimited Potential group is not part of the company's corporate social responsibility department, but rather a for profit division committed to delivering relevant, accessible and affordable software to the BoP. This is exactly what the BoP discourse is trying to do - get corporations to engage through their business units, not just CSR departments.

Rawding discussed how Unlimited Potential is finding avenues to foster social and economic opportunity while at the same time bringing innovative technologies such as the Classroom Computer to people living in developing countries. He acknowledged the challenges of addressing BoP markets, especially since Microsoft historically has produced software and technology for the billion people at the top of the economic pyramid.

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"Filling the Finance Gap" The Clinton Global Initiative's Poverty Alleviation Working Group Session

Ana Escalante — Thu, 11 Oct 2007 11:05:08 -0500

How do we get more capital to the people who want to start their own SMEs? It is difficult to make a case for this "missing middle." NextBillion has identified this problem in the past, and it seems like now the issue is beginning to unfold in the development debate: the Clinton Global Initiative is now discussing this very issue.

SMEs are good for the economy - they create wealth, create jobs and usually need financing so they can grow to scale. The financing gap exists for a layer of potentially high-growth SMEs that occupy a space between large MNC projects and micro-entrepreneurs. The World Bank has found a connection between the number of SMEs in a country and a country's growth, and has posited that without SMEs, it’s difficult to sustain economic growth.

The following videocast is of a session entitled "Filling the Finance Gap" at the Clinton Global Initiative's Poverty Alleviation Working Group a couple weeks ago. The speakers: Alan Patricof, Sonal Shah and Hubertus van der Vaart, do an exceptional job of explaining the challenges of investing in entrepreneurs and SMEs in emerging markets; they debate about the financing gap, or the "mesofinance gap."

Watch the videocast here

I find what Patricof says about the companies in the United States very interesting. He mentions Staples as an example of a company that started small and then scaled up to become a big U.S. corporation, thanks to the existing capital structure in the United States. There are similar companies with great potential in a multitude of emerging economies, but most face a consistent challenge: lack of financing tools.

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Jobs/Careers: Managing Director – Development Focus Area at WBCSD

Ana Escalante — Thu, 04 Oct 2007 10:10:26 -0500

The World Business Council for Sustainable Development is recruiting for a Managing Director position based in Geneva, Switzerland.The role of this position is to contribute to the strategic direction of the WBCSD.

The successful candidate will be expected to:

Engage the company executives in the steering committee of the Development Focus Area to develop and gain approval of the strategy and overall work plans;

Engage broadly with the WBCSD member companies and regional network partners to raise awareness of development related issues and opportunities for business;

Work with representatives from WBCSD member companies – of many different industry sectors - to lead the implementation of the work program;

Advocate for improvements in the overall investment climate for doing business in emerging economies with government, intergovernmental and civil society organizations;

Explore collaborative opportunities with government, multi-laterals, development organizations and civil society organizations to partner with business to deliver real progress on the ground.

To submit an application for this position send a cover letter and resume to job@wbcsd.org. The deadline to receive applications is October 31, 2007. Click here for more details on the job listing.

This is the perfect opportunity to join the WBCSD team of professionals who share the motivation make a difference in the world and support sustainable development through business. NextBillion encourages our qualified readers to apply!

Imagine What’s Next: Ideas that Will Change the Way the World Does Business

Ana Escalante — Thu, 04 Oct 2007 08:26:48 -0500

The Social Venture Network hosted the competition "Imagine What’s Next: Ideas that Will Change the Way the World Does Business" in June and announced the winners on Monday. This innovation award's objective is to find businesses and leaders that create positive social change in the business sector.

Out of the ten winners, I would like to highlight two because of their work within the BOP sphere:

Design that Matters, Timothy Prestero, CEO (Cambridge, MA): Design that Matters (DtM) was founded to help social enterprises in developing countries scale more quickly by providing them access to better products designed specifically for their needs. DtM’s design work and business analysis is performed by volunteers from academia and industry, using the infrastructure available at their host institutions. Academic contributors include MIT, Stanford and the Rhode Island School of Design, and corporate partners include IDEO and Fisher Price, SolidWorks and Optikos.

World of Good, Priya Haji, Co-founder and CEO
(Emeryville, CA): World of Good seeks to lift thousands of women in the developing world out of poverty. It creates opportunities for hundreds of artisan cooperatives around the world by serving as a bridge to the U.S. retail market and providing access to fair wages, safe working conditions and long-term economic sustainability. ProjectGood.com is the newest venture launched in partnership with eBay to create a people positive shopping experience designed to help millions of consumers connect with producers around the world.

The winners of the competition will be honored at the SVN Fall Conference in California later next week. Since 1987, SVN has been working to promote social enterprises and encourage socially responsible investing, sustainable and green enterprises. They identify businesses and entrepreneurs that value both social concerns and profitability.

Technology Benefiting Humanity: Taking Innovation to the Next Stage

Ana Escalante — Wed, 03 Oct 2007 09:52:45 -0500

Santa Clara University will be hosting a conference on November 8^th with Manuel Castells, the world's leading researcher in the field of communication technology and society; Al Hammond, World Resources Institute's Vice President of Special Projects and Innovation and also a writer here on NextBillion; Sally Osberg (invited) President and Chief Executive Officer of the Skoll Foundation; Regis McKenna (invited) - Chairman of the Center for Science, Technology, and Society; and other foremost Silicon Valley thinkers.

This will conference examine how "social entrepreneurs" are breaking down barriers, and remaking the rules of innovation, with careful consideration to how social entrepreneurs "reframe" problems -- from overcoming civil engineering deficits, capital access constraints, base of the pyramid skill shortages, to dealing with fragmented markets.

Learn, too, about programs at the Center to bridge the innovation gap such as its Global Social Benefit Incubator (GSBI) and KnowledeX (sponsored by Applied Materials).

The conference will be very interesting – the innovators and thought leaders attending will offer insights on the ways technology and design influence the BOP and redefine parameters and market assumptions.

Admission is free, but advanced RSVP is required. To register, contact Sherrill Dale, sdale@scu.edu, (408) 551-6027. Click here for more information.

NESsT Celebrates its 10th Anniversary

Ana Escalante — Mon, 01 Oct 2007 15:02:05 -0500

Last week, I attended the NESsT 10^th anniversary party at Pangea Artisan Market & Cafe in the International Finance Corporation (IFC) building (2121 Pennsylvania Ave, NW, Washington DC). The store has an interactive education component, with computers that provide information about the store’s artisans and their designs. The place is great and it matches really well with the idea of NESsT – promoting social enterprises in the world.

NESsT is an organization that works in emerging market countries "by developing and supporting social enterprises that strengthen civil society organizations' financial sustainability and maximize their social impact."

NESsT combines the tools and strategies of business and entrepreneurship with the values of philanthropy. It supports the development of social enterprises in emerging democracies worldwide. Former NextBillion staff writer Lauren Abendschein blogged about NESsT a couple of months ago.

At the event last week, I met the co-founders and CEOs of NESsT, Nicole Etchart and Lee Davis, both wonderful and insightful people. Nicole is from Chile and she works at NESsT’s offices in Santiago. During the event, a NESsT board member gave a speech recalling the story of when Nicole and Lee started with their idea in Baltimore, and how difficult it was for them to convince people to support them and to believe in the ideas that NESsT embraces. Today, after ten years, NESsT is one of the most recognized social enterprise catalysts in the world. They work with four initiatives, including a venture fund, university support, consulting, and a marketplace.

In some ways NESsT is similar to New Ventures, because aside from providing one-on-one relationships with the companies in its portfolio, it also to strengthens the field of social enterprise through training, forums, workshops, and publishing. The entire team at NextBillion congratulates NESsT on its 10^th Anniversary and wishes them to continue the good work!

The Tech Museum Awards Laureautes Announced

Ana Escalante — Fri, 28 Sep 2007 16:12:15 -0500

Technology Benefiting Humanity and the Tech Museum Awards winners were announced earlier this month. These awards recognize and support solutions that benefit humanity and address some of the most critical issues facing our planet and its people.

The Laureates are announced each year and they can be individuals, for-profit, public or non-profit organizations and they must demonstrate that with the use of technology, they can improve the human condition in one of the five areas:

- Evidence that a serious problem or challenge with broad significance is addressed by this use of technology
- A noteworthy contribution that surpasses previous or current solutions.
- A novel application that represents a breakthrough or a creative adaptation of an existing technology.
- The potential for this use of technology to serve as an inspiration or model for others.

Among the 2007 laureates are P&G's Children's Safe Drinking Water Program, Kiva and PATH all of which we have blogged about on NextBillion. To see the complete list of all Laureates click here.