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If you plan to take Labor Day weekend to brush up on BOP reading (perhaps in advance of next week's "Business to Four Billion" conference), then you're in luck. Naturally, I'll point curious readers to our Resources page, and also to the recent papers by Aneel Karnani (a BOP critic). And, as of today, I'll add Anand Kumar Jaiswal to the list as well.

Professor Jaiswal is the author of a working paper entitled, "Fortune at the Bottom of the Pyramid - An Alternate Perspective." He is based out of the Indian Institute of Management - Ahmedabad, and sent me a link to his paper along with the following message:

[My] paper argues against viewing the poor as [only] consumers, as suggested by Prahalad or only as producers, as suggested by Karnani. Drawing from the unethical exclusion and inclusion perspective, it contends for selective consumption by the poor. I hope this paper will be of interest to visitors of NextBillion. [The] paper aims to extend the ongoing debate and contribute to better understanding of BOP.

I was understandably excited when I received this note. (Yeah, this stuff excites me, what can I tell you?) In any case, I have had a read through and my initial reaction is a bit mixed. To be sure, Prof. Jaiswal hits on some key points, especially regarding Prof. Prahalad's case studies in the 2004 Fortune at the Bottom of the Pyramid book. I found it particularly interesting to read about the history behind Hindustan Lever's sachet approach (they launched the initiative not to hit on a new market, but to prevent themselves from being out competed by Nirma.)

He also (rightly) points out how most - if not all - of Prahalad's case studies are taken from the "emerging" economies (Brazil, Mexico, South Africa, India, China), and not from more poor countries such as Pakistan, Tanzania, Nicaragua, etc.

That said, history has not stood still in the intervening years - there are tens, if not hundreds more case studies out there documenting real benefits derived by and with the BOP in conjunction with the private sector. Many of these studies document work ongoing in places like Kenya, Pakistan, Nicaragua, El Salvador, Bolivia, the Philippines, Indonesia, etc. The BOP is not just a "fad" in emerging economies, as Prof. Jaiswal insinuates.

Furthermore, he wades into the murky waters of measuring the size of the BOP. In doing so, he uses traditional poverty statistics and publicly available World Bank data - not a bad approach, but one that has been improved upon by the recent The Next 4 Billion: Market Size and Business Strategy at the Base of the Pyramid report by World Resources Institute and International Finance Corporation. At the very least, he could have looked at the report before making an ill-informed argument about the true size of the BOP.

(Side note: No, the BOP market is not $13 trillion per year, as C.K. Prahalad once asserted. It is more like $5 trillion per year, based on a peer-reviewed methodology developed by WRI and IFC. Prahalad didn't have access to these data, so he can be forgiven for the mistake. But it is equally wrong to use these insufficient data to recalculate the size of the BOP - as both Karnani and now Jaiswal have done)

Regardless of the measurement issue, I think that Jaiswal adds a lot to the BOP debate. His paper is a must-read as you prepare to go to Michigan next week for the conference, and I would encourage you to download it from the REPEC web site.

Thanks to Prof. Jaiswal himself for providing notice and a link to the paper.

Mobile banking seems to be the new way to "bank the poor." There are a growing number of companies working with these new technologies, some of which have been featured on NextBillion in the past. Schemes vary from those operating with standard in-country banking transactions to those with foreign remittances. Mobile banking is taking off because it is convenient, fast, simple, and secure - money can be transmitted almost instantly. That, and many people in developing countries now own or have access to a phone.

Recently, NextBillion got an e-mail from Mobile Plus and FE-Mobile telling us about their new venture: enabling low-value payments and remittances through mobile phones. Mobile Plus is a small group of entrepreneurs that have built secure payment mechanisms and low value cross border mechanisms for developing countries. According to their press release:

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A good friend directed me to the Hans Rosling’s TED talk. I found this video particularly interesting because the way Rosling presents data is very dynamic and viewer-friendly. The animated visualization of data makes it is easier to draw conclusions and see trends. That said, I want to question Rosling’s assertion about "myths" in these data. In reality, data can not only lead to myths, but can also debunk them or help correct other misconceptions of reality in so-called "third world countries."

Rosling’s main argument is that data should be made more accessible. With more accessible data, it will be easier to draw appropriate conclusions and create change. Today, with the Internet, data are becoming more accessible than ever before. For example, the United Nations had just opened up a lot of its databases. So I’m not sure that accessibility is really the issue.

Rosling also contends that, based on data, we can use design tools to show important trends and patterns happening in third world countries. For example, his Gapminder software "animates" data by creating a movable features. It’s a very dynamic way of looking at information and drawing conclusions, and I salute him for it. I won’t disagree that we need tools like Gapminder to help us display data in a more intuitive, dynamic fashion.

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NextBillion's good friend and colleague Stuart Hart - of the Center for Sustainable Global Enterprise at Cornell University and Enterprise for a Sustainable World - has recently released the second edition of his book, "Capitalism at Crossroads." The newly revised edition includes new case studies, up-to-date info on trends, and insights from the BOP Protocol.

The book is an updated, thoroughly revised edition:

Drawing on his experience consulting with leading companies and NGOs worldwide, Hart shows how to become truly indigenous to all your markets -and avoid the pitfalls of traditional 'greening' and 'sustainability' strategies. This book doesn't just point the way to sustainable enterprise: it offers specific techniques to recharge innovation, growth, and profitability in real businesses.

The new edition of "Capitalism at Crossroads" has a foreword by Al Gore, former vice-president of the U.S. and member of the WRI Board of Directors. The book is on sale on all major book retailers. Check it out, and congratulations to Stu!

Side note: Stu will be delivering a plenary talk at next month’s Business to 4 Billion conference at the University of Michigan (also his alma mater). There are only 9 spots left, so register today if you’re interested – it is sure to be a good event for those interested in the BOP arena.

New Ventures interviews Axial Par director Paulo Bellotti about his firm's unique small enterprise development model and the key to successful SME investment.

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The tagline for Brazilian venture capital firm AxialPar is "Investing in Sustainability," but speaking with Director Paulo Bellotti, it quickly becomes clear that a knowledgeable firm in the green SME sector must be focused on more than just a company's environmental benefits. Paulo explains that investors moving into the profitable but largely uncharted territory of SME finance must have a holistic approach with any investment, taking into account sustainability impacts, but also placing a heavy emphasis on new technology, strong management and clear market opportunities.

It is on these foundational principles that AxialPar has based its efforts, mitigating the risk inherent in investing in small green companies by focusing on high-growth sectors including health foods, renewable energy and clean technology. Paulo asserts that small enterprises have an advantage in these newer industries, as their flexibility relative to larger corporations allows them to quickly adapt new environmental technologies to specific market demands. AxialPar also targets its investments in areas where there is a potential to create clusters of SMEs that can exchange technology and technical assistance in a mutually beneficial value chain - such is the case with portfolio company Mar&Terra, a sustainable fish farm that supports small local producers who form part of the company's supply chain.

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In high-income countries, asthma is usually a nuisance, but among the rural BOP, asthma can be a costly and deadly disease for victims who are unable to access treatment locally.

Eric Green, a medical student at Stanford University, traveled to Mexico last year as part of a group from his “Entrepreneurial Design for Extreme Affordability” class. In Mexico, he found inspiration for the invention of a very low-cost asthma inhaler spacer, an apparatus that attaches to the medicine canister and enables young children to take the medicine. He named the apparatus “Respira!,” Spanish for “Breathe!” He explains the motivation behind Respira!:

 

“This project began with a trip to the Higueras Health Center in Nuevo Leon, Mexico. There I met Jose Antonio, a young physician working and living in this center. He told me the story of Jesus, a child arriving with his mother in the middle of the night and gasping for breath [from an asthma attack]. Jose Antonio knew the right treatment immediately but had no way to deliver it. Although he had a refurbished nebulizer sitting in the corner of the room, it had not worked for years.

He then took me to a side room with a humidifier and explained how he desperately tried to get medication to Jesus’ lungs by pouring it into the humidifier, closing the door and hoping. It was the combination of his own feeling of frustration, the powerlessness and anxiety of the child’s mother, and the suffering and fear of the child that compelled me to address this need [for more affordable asthma treatment]” (excerpt from Respira’s Changemakers Competition entry, written by Eric Green).

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The "Disruptive Innovations in Health and Health Care" competition from Ashoka’s Changemakers - that Julia blogged about in July - is now in its last stage: the voting!

There were about 300 projects that participated in this competition, ranging from microinsurance to direct selling and franchising to telemedicine. Nine finalists have been selected, including "Scojo Microfranchises Deliver Affordable Reading Glasses to the Rural Poor" from the Scojo Foundation, which is one of our recently released What Works case studies.

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GlobalGiving, the online charity marketplace that we've blogged about before, has launched a new "prediction market" online. They are looking for a "master speculators."

Much like eBay's approach to online commerce, GlobalGiving is changing the way people give. We work with a network of well-run organizations and carefully research their projects - gathering detailed information on the project leaders, as well as the projects' objectives and expected outcomes. Then, we make it simple for you to give to these projects and track the impact of your generosity.

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After reestablishing New Ventures Mexico as its own independent organization, growing the program to incorporate a broader range of enterprise development services and creating a flashy new site worthy of a Webby (in our opinion), we at New Ventures global would have thought country director Rodrigo Villar could finally rest on his accomplishments. Apparently, we were wrong - building off a highly successful year for the Mexico team, it was announced recently that Rodrigo has been awarded as one of the newest class of Ashoka fellows.

Ashoka describes its fellows as being "social entrepreneurs who we recognize to have innovative solutions to social problems and the potential to change patterns across society. They demonstrate unrivaled commitment to bold new ideas and prove that compassion, creativity, and collaboration are tremendous forces for change." These words are an apt description for Rodrigo, who has worked relentlessly over the past four years to pioneer a new model of sustainable enterprise development in the region. The project for which Rodrigo was selected is a new "Green Pages," a sustainable products and services guide that will be a clearinghouse of information for new generations of green consumers in Mexico. Rodrigo noted the crucial timing of this project: "The idea now is to feed growing demand for sustainable lifestyles by providing easy access for consumers to this new class of products in a massive way."

The five new fellows in Mexico were announced at an induction ceremony last week, and the group had a chance to mingle with other Ashoka members at an event celebrating the organization's 20 years operating in the country. Congratulations to Rodrigo on this new partnership, it is a major milestone in a career of promoting sustainable enterprise growth in Mexico - just one achievement of many more to come.

The Inter American Development Bank (IADB) recently hosted a video competition called "The Faces of Exclusion." The purpose of this competition was to expand beyond traditional research techniques in socio-economics; the IADB was particularly looking for documentary films that stimulate reflection on social issues. All IADB member countries were invited to participate.

The winner was announced earlier this month, and is a very compelling video on the Prestes Maia building in São Paulo, Brazil, here's the video:

Prestes Maia, a 22 story abandoned building in deplorable conditions in São Paulo was the shelter of roaches and rats. Since 2002, it has been occupied by hundreds of homeless families when they united and formed the Downtown Roofless Movement (Movimento Sem Teto do Centro or MSTC) of São Paulo.

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