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NextBillion News vol.19 December 5, 2007 =============================================================
NextBillion News: BoP Conference Update, Latin American Competitiveness, $100 Laptop, and More

[Contents]

1. New Resource: Business with Four Billion Returns!

2. Featured Blog Posts:

Conference Report: The Role of the Private Sector in Latin America
Abigail Keene-Babcock

A Lesson to BoP Technologists: Put the Business Plan First
Al Hammond

The Business Model of Hopes and Dreams
Manuel Bueno

3. Rising Ventures: Suminter India Organics

4. Featured Event: Symposium on "Sustainability Prize" Business Plan Competition

5. Jobs/Careers: Job: Product Manager, MicroPlace

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1. A New Resource: Business with Four Billion Returns!

This past September, the William Davidson Institute (WDI) at the University of Michigan and the Center for Sustainable Global Enterprise at Cornell University hosted "Business with Four Billion: Creating Mutual Value at the Base of the Pyramid." It tapped into growing interest in venture-based strategies for serving the four billion poor at the base of the pyramid (BoP) and was the first major BoP conference since 2004's Eradicating Poverty Through Profit event in San Francisco.

Business with Four Billion was successful, brining together nearly 400 of the leading BoP business managers, policy makers, social entrepreneurs, academics, non-profit experts, and development agency professionals from over 30 countries and six continents.

In the plenary sessions, leading BoP experts delved into key issues currently facing the BoP community. The concurrent sessions provided an opportunity for participants to engage cutting-edge thinkers on specific topics in three areas: Landscape, Development, and Capabilities.

NextBillion has now created a permanent Business with Four Billion resource page that details the conference’s activities and provides links to all available presentations from both the plenary and concurrent sessions. So, if you didn’t make it to the conference, or couldn’t be in three places at once to catch it all, now you can find out, in detail, what went on!

The resource page also makes it easy to find out more about leading BoP thinkers and organizations, research their work, and read blogs written by people during the conference.

Read more

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2. Featured Blog Posts

Conference Report: The Private Sector’s Role in Latin America

Abigail Keene-Babcock

On Tuesday, I went to Georgetown University to attend a high-profile panel on "The Role of the Private Sector in the Competitiveness of the Latin American Region." The line-up of panelists included three former presidents (Vicente Fox - Mexico, Alejandro Toledo – Peru, Jose Maria Aznar – Spain), one former prime minister (Roberto Danino – Peru) and three prominent businessmen from Latin America and Spain (Stanley Motta – President of Motta International, Marcelo Claure – Founder of the Brightstar Corp., and Gustavo Cisneros, Chairman of the Cisneros Group of Companies). Quite the assembly of lauded economic reformers and successful business leaders.

The event was paired with the launch of a new online journal, Globalization, Competitiveness, and Governability (GCG), a joint project between Georgetown and Universia, an online space for university education resources across Latin America, founded and supported by Banco Santander. GCG promises to be a rigorous source of ideas and advanced discussion on issues of business and governance in Latin America, and we’ll definitely be following it in the future on NextBillion for particularly good pieces related to business and poverty reduction strategies in that region.

Going in, I hoped to find some golden nuggets in the high-rollers’ comments – specifically referencing the BoP and the role of private enterprise in opening markets and opportunities to the poor, as both producers and consumers. I wasn’t disappointed, although the breadth of the topic covered meant that no issues were pushed into specifics and vagueness tended to prevail (aside from the very strong remarks of support for the Colombian free trade agreement currently pending before Congress, made directly to the VIP seating section).

Most of the panelists’ comments focused on the broad issues of trade liberalization, institution-building, economic/legal stability, education, health, and infrastructure. However, some remarks indicated that a few of the speakers had clearly latched on to market inclusion and engagement of the BoP as both an economic and social necessity.

Read more

 

A Lesson to BoP Technologists: Put the Business Model First

Al Hammond

A recent Wall Street Journal article documents the demise of Nicolas Negroponte’s dream of a $100 "one laptop per child" for millions of schoolchildren in the developing world. (Thanks to Ethan Zuckerman for pointing it out.) To give Negroponte his due, the idea stimulated significant technology development and focused market attention on the need for low-cost computing devices for BOP markets. And from an engineering perspective, it's a magnificent machine.

But the $100 price was never realistic; the market is dominated by small businesses and only secondarily by educational systems, and the project lacked a real business model, including such essential details as training and technical support. (We've written about OLPC's lack of training and tech support time and again here on NextBillion.)

It was from the beginning an inspiring but unrealistic vision—comparable to the "build it and they will come" belief that funneled hundreds of millions of development dollars into Internet access telecenters, 90% of which failed when the grants ran out. Technology push strategies just don’t work.

If there is any lesson that our studies here have shown, the essential starting point is a viable business model, grounded in a real understanding of needs, the value proposition as perceived by local people, and evidence of willingness to pay. Only then can technology opportunities really be evaluated. That is not to say that technology doesn’t have a critical role as an enabler for BOP communities — witness the still accelerating adoption of mobile phones (and their prepaid service business model). But engineers — especially those that don’t know developing market well — should take to heart the real moral of the laptop story: First, it’s the business model.

Read more

The Business Model of Hopes and Dreams

Manuel Bueno

It is often the case that business models touch but rarely elaborate on the aspirational value of many products offered for the first time at the BOP level and the subconscious consequences they have on BOP consumers. I recently read, with a touch of sadness, a short article published in the Sunday Times on September 30th called: "Book now for the flight to nowhere."

In this article the author talks about an old airplane, an Airbus 300, in Delhi. This airplane never actually takes off. But it offers the service of helping passengers imagine how it would be to take a flight. The plane only has one wing and is missing part of its tail. Meals are served with a trolley cart, and a generator powers the air-conditioning.

The plane simulates its flight every Saturday. Irrespective of the veracity of this story, it points to an acute unmet need at the BOP: the need for consumers to believe there is something more out there worth aspiring for and worth fighting for. There are, by now, several business models for the BOP – many that I have probably never heard about. Their primary aim is often to let the BOP customer avoid the poverty trap and poverty penalties associated with BOP markets while integrating them into the global economy.

But poverty penalties do not only include higher prices for worse goods, and they are not only about dirty water or non-existent transportation.

Read more

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3. Rising Ventures: Suminter India Organics

Suminter India Organics sells a wide variety of organically grown, non-perishable produce. It provides local farmers with the necessary training and certification from an internationally recognized organics certifying body, provides the necessary farming inputs for organic cultivation, and buys back their final products. By providing the forward linkages that farmers require to bring their products to market, Suminter bridges the gap between the company’s suppliers and the global market. Farmers incur substantially lower costs and also receive a 10 percent premium over market prices, and their products are commercialized through a fair and transparent process.

Read full company profile

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4. Featured Event: Symposium on "Sustainability Prize" Business Plan Competition

The William James Foundation will host an educational symposium on Friday, December 7^th from 4-6pm at the Affinity Lab Offices in Washington, DC.

This year, the William James Foundation is partnering with the Foundation for a Sustainable Future to present an extra level of "Sustainability Prizes." The prizes -- $2,000 for 1st place, $1,000 for 2nd place, and $500 for third place – will be awarded on top of any prizes awarded through the regular process of the William James Foundation’s competition.

The Symposium event will feature a panel of reading judges providing general feedback on the business plans submitted for the Sustainability Prizes competition. The judges will also announce which teams will be invited to the second round of the competition, and give tips for the second round. There will be a reception following the symposium. All entrants, readers, and individuals interested in sustainable business are invited.

Read more

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5. Jobs/Careers: MicroPlace, Product Manager

MicroPlace’s mission is to alleviate global poverty to enable every day people to make investments in the working poor. MicroPlace will accomplish this mission by maintaining a web-based marketplace to connect retail investors (every day people looking to invest as little as $100) with microfinance lending organizations that need capital.

Microplace is looking for a highly motivated individual who thrives in a start up environment and is passionate about the social mission of MicroPlace to join the team as Product Manager.

Location: San Jose, California

Microplace seeks candidates for the position with five years of product management experience, working with internet applications, preferably consumer facing websites. Experience in building backend systems a plus. Candidates should also have past experience in designing and managing the product planning process.

Read more

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NextBillion News vol. 19 December 5, 2007

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