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Last night I attended a reception to launch Global Savings, Assets and Financial Inclusion, a new report issued by Citi Foundation drawing on the conclusions of last year's Global Symposium on Savings, Assets and Financial Inclusion organized, among others, by New America Foundation.

CGAP's Kate McKee, who collaborated in the report, offered some very interesting insights on the symposium and the report based on her experience designing asset building strategies. Especially interesting were her remarks on the fact that the microfinance movement and the BoP community in general must go beyond credit and transaction mechanisms --i.e. mobile banking, which have predominated in the debate about financial services for the poor so far-- and offer the poor real and practical alternatives to walk the "financial ladder" towards greater economical security through asset building mechanisms like savings and insurance.

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Editor's note: The following blog post was originally published as a comment by Joseph Bornstein, responding to the numerous reactions generated by his previous entry "What Is Called Development?: Exploring The Nexus of Economy"

"Where do we find ourselves? In a series of which we do not know the extremes, and believe that it has none." Emerson, paragraph one of "Experience"

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I received an e-mail last week from the organizers of Social Capital Markets 2008, a conference bringing together "entrepreneurs who want to change the world and the capital that wants to make it happen."

The organizers of SoCap08 - as they refer to it as - have lined up an all star cast of speakers, including longtime bottom of the pyramid practitioners including Bob Annibale of Citigroup, Paul Polak of IDE, Alvaro Rodriguez of IGNIA, Willy Foote of Root Capital, Jed Emerson of Blended Value and many more.  The conference tracks will also be of interest to NextBillion readers, especially the "MFI and Beyond" and "Social Capital" areas.

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Editor's note: I received this e-mail over the weekend, announcing a unique base of the pyramid sector competition.  Read on for details.

The Social Equity Venture Fund (SEVEN Fund) has recently launched the VINE (Virtual Integrated Networking Experience) Competition. The unique competition, open to all, merges the world of commercial financial investment with open innovation to promote a broader free flow of ideas for investment in emerging market small and medium sized enterprises.

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I'm hungry, and it's getting late; I'm worried about missing my train.  The potluck table full of food isn't helping my growling stomach, especially as more and more dishes arrive.  A fellow bystander casually offers play-by-play commentary: "India's represented.  Now Ireland.  Ghana's here; so is Peru.  Where are the Hondurans?  And the Zambians!  They always hold things up…"

This scene took place yesterday, in the courtyard of a 1970s-era dorm at MIT, outside of Boston.  Along with 60 others, I was waiting for the Hondurans and Zambians so we could begin the International Development Design Summit's (IDDS) around the world potluck dinner.  IDDS is a two week workshop/seminar/collaboratorium organized by MIT's appropriate design guru, Amy Smith.  A MacArthur Genius Award winner, Smith is renowned for her passionate, down-to-earth approach to design for base of the pyramid markets. (I wrote about her back in 2006.)

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I believe that the dialogue on philantrocapitalism featured in NextBillion is actually rooted in a matter of pure semantics. As Edwards points out in his book, the whole conversation surrounding NextBillion.net has coined a number of terms (Social Enterprise/Entrepreneurship, patient/creative capital/capitalism, blended value, double/triple bottom line, B, M and ToP, inclusive business, and the list goes on...) that can create confusion and may pose a risk overheating for the sector. Even SMEs are now being called Small and Growing Businesses. Not that I disagree; we want them to grow and become the next microfinance, but agreeing on a nomenclature wouldn't hurt. By the way, stay tuned next week for a wrap-up of the ANDE conference.     

Anyway, I guess this is the case for any growing sector and challenges like Edwards' are necessary for the it to gain maturity and continue its consolidation. Skoll Foundation has previously tackled the question of definition, and two recent papers continue the conversation around key issues for the sector's maturity: the first, by CGAP, discusses the (some may argue) blurring line between the for- and non-profit models, analyzing ownership and governance challenges faced by MFIs as they leave the NGO model and transform into commercial institutions.  Also, Harvard Business School discusses the future of social enterprise, as part of its year-long 100^th birthday celebrations.

On another note, just a couple of links to remain current on the latest water debate: Scientific American offers a very informative piece on the coming water crisis, possible courses of action and how it will affect everyone at the base and elsewhere in the economic pyramid. This week's Economist also goes into water shortages focusing on the markets and pricing issues, as does Aguanomics' David Zetland in a recent Forbes article. All pieces seem to agree at least on one point: sooner than later, prices will keep us from taking water for granted.

This is the fifth and final installment of our series reviewing Michael Edwards' Just Another Emperor and the concept of 'philanthrocapitalism'. Follow the links to read part 1, part 2, part 3 and part 4.

By Rob Katz and Francisco Noguera

Philanthrocapitalism – harnessing business and the market to the goals of social change – is a controversial term. First introduced by The Economist's Matthew Bishop, then expounded upon by the Ford Foundation's Michael Edwards, philanthrocapitalism has been the subject of no fewer than four major online discussions and debates. Here at NextBillion.net, we have dedicated five blog posts to the topic, offering a range of opinions on Edwards' new book, Just Another Emperor: The Myths and Realities of Philanthrocapitalism.

Derek, Moses, Manuel and Nitin – who authored the first four entries in this series – offer a range of viewpoints, mostly critical of Edwards' argument that market strategies are inappropriate tools for driving social change. Edwards, of course, makes many salient points, and is not to be criticized as a hack. (Over at the Global Philanthropy Forum blog, Benetech's Jim Fruchterman deconstructs Michael Edwards in no uncertain terms, and comes close to making this very criticism. Edwards responds.)

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I visited the slums of Nairobi in the summer of 2002. I remember being completely overwhelmed by the poor living conditions: large families cramped into little rooms, putrid refuse scattered throughout the neighborhood, young children left seemingly hopeless. I remember thinking to myself, what can possibly be done?

That summer, upon graduating from the BBA program at the University of Michigan's Business School, I was in Kenya on a service project with a small group from my local church.  For six weeks, a dozen of us taught English, science, and math in schools throughout Kenya.  But it was while visiting the slums that something in my heart and mind shifted.   It was an epiphany of sorts – similar to another epiphany I'd had the summer before, which led me to Nairobi in the first place.

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Our regular NextBillion readers will already know that the MIT is one of the most important universities in the base of the pyramid arena. Some of their most important initiatives are the Legatum Center for Development and Entrepreneurship, stimulating bottom-up entrepreneurship fueled by innovations, and the Lemelson-MIT Awards, recognizing the impact that inventors can have on economic and social well-being.

In these and other cases, MIT's strategy has been to apply its engineering prowess to try to solve BoP problems in the shape of technologically-adapted inventions.

Now, MIT has launched a Next Billion Network to deploy innovative mobile technologies that can help people reduce friction in their local markets from the bottom up. This approach is based upon the belief (which I share) that mobile phones, by enabling increased connectivity, can offer new opportunities for low-cost, sustainable solutions in the BoP.

With mobile phone penetration rates in some countries still very low and with developed countries already being mature markets, it has been widely predicted that, within the next few years, the next billion people to get a mobile phone will come from developing countries. Moreover, it will be their primary (and perhaps only) connection to the global communications network.

The Next Billion Network could develop into something especially interesting, because it takes into account the fact that countries with low levels of phone penetration also lack widely-accessible computers and internet connections.  As such, the mobile phone has the potential to quickly fast-forward into both a PC and an internet device. Similarly, the NBN takes into account the role of mobile phone banking. The initiative, in sum, looks at mobile phones as tools that could become much more than a mere talking and texting device. I find this approach very exciting and refreshing.

The Next Billion Network is based at the MIT Media Lab and will comprise 6 core activities:

1. Year-Round Academic Coursework at MIT
2. Next Billion Challenge Awards
3. On-the-Ground Deployments with Local Partners
4. Working Relationships with Industry
5. Local Mobile Programming Incubators
6. Opportunities for High-Tech Entrepreneurship

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I recently had the pleasure of attending a presentation by Al Hammond which detailed his plans for revolutionizing rural medicine and access to telecommunications in developing nations. Here is a condensed rendition of the picture he painted: The majority of rural communities in developing nations have no access to telecommunication systems, and this is a problem considering that telecommunications are an essential tool for offering the poor services and possibilities that they would otherwise not have access to. The communications gap can be bridged by installing wireless access hubs in remote communities and the hand of wireless technology could leapfrog reaching almost any community at a cheap price.

This innovation opens a whole new market for cell phone companies and offers yet another excellent pipeline for BoP development and for getting a share of the fortune at the base of the pyramid. This is what we in the BoP community would call a double bottom-line profit model because the business plan is not only economically profitable, but also reaps social benefits by providing the services of telecommunications to poor rural communities. In this model, social justice meets capitalism. They shake hands, and build a better tomorrow.

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