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Information and Communication Technologies

Sowing the Seeds of Green Entrepreneurship: Startup Bootcamps and Pitching Competitions

Julia Brethenoux's picture

Heading back from a recent mission to Ghana, I felt really proud of what we have accomplished: training 20 of the most promising local clean-tech entrepreneurs through the Green Innovators Bootcamp. The words used to inaugurate the event are still in my head: “This bootcamp is not an end in itself. It’s the beginning of your journey as entrepreneurs.”

Indeed, bootcamps for startups and SMEs – as well as close cousins like Hackathons, Start-up Weekends, and Business Plan Competitions – are an increasingly popular activity used to catalyze innovative ideas and provide entrepreneurs with the tools and resources they need to launch their ventures.

In Ghana for example, infoDev -- a global innovation and entrepreneurship program in the World Bank Group -- organized a two-day training event to help a group of 20 early-stage entrepreneurs assess the feasibility of their business concept, identify their customer base, and refine their business model.
 
Organizing a bootcamp can be very challenging and time-consuming, but, when done properly – read “7 things you need to do to prepare for the perfect bootcamp” – the payoff is big. "Bootcampers" find these initiatives very useful to identify new solutions to the challenges they face to launch their businesses -- mostly access to finance, product development, and marketing. Furthermore, "pitching competitions" and "business contests" offer new entrepreneurs an excellent and safe stage to refine their business pitch -- a key tool of every successful entrepreneur.
 
One of the goals of bootcamps and pitching competitions is to bring together different stakeholders – from entrepreneurs to investors and policymakers – to facilitate the creation of ecosystems in which entrepreneurs can grow and thrive. But is it realistic to expect that bootcamps and similar training initiatives are enough to enable promising entrepreneurs to reach their full potential? The answer is simply: No. Make no mistake: Bootcamps are an exciting tool to create buzz and interest in countries that have little entrepreneurial history and culture. In most contexts, however, there is no follow-through with effective action plans that can keep the momentum going. This not only limits the value of these initiatives, but can also cause harm to a nascent ecosystem.

Closing the gender finance gap: Three steps firms can take

Heather Kipnis's picture
Despite eye-opening market potential — women control a total of $20 trillion in consumer spending —  they have somehow escaped the notice of the private sector as an engine for economic growth.  Women are 20 percent less likely than men to have an account at a formal financial institution. Yet a bank account is the first step toward financial inclusion.

Why is it important for the private sector to help with this first step?
 
In increasingly competitive global markets, companies are searching for ways to differentiate themselves, to deepen their reach in existing markets and to expand to new markets. Greater financial access for women would yield a growing market opportunity with phenomenal profit potential for companies. The size of the women’s market, and the resulting business opportunity, is striking:
 
  • Business credit: There is a $300 billion gap in lending capital for formal, women-owned small businesses. Of the 8 to 10 million such businesses in 140 countries, more than 70 percent receive few or no financial services.
  • Insurance Products: The Female Economy, a study in the Harvard Business Review, reported that the women’s market for insurance is calculated to be worth trillions of dollars.
  • Digital payments: Women’s lack of cellphone ownership and use means that millions cannot access digital-payment systems. Closing the gap in access to this technology over the next five years could open a $170 billion market to the mobile industry alone.
 

Greater financial access for women would yield a growing market opportunity with phenomenal profit potential for companies.


For the past several years at IFC, I’ve been working with the private sector, namely financial institutions, to address the supply-and-demand constraints that women face when trying to access the formal financial system. IFC tackles these constraints in three ways:
 
  • Defining the size of the women’s market, female-owned and  -led SMEs, and as individual consumers of financial services
  • Showing financial institutions how to tap into the women’s market opportunity by developing offerings that combine financial products, such as credit, savings and insurance, with non-financial services such as training in business skills
  • Increasing women’s access through convenient delivery channels, such as online, mobile and branchless banking

If you want to go far, go together

Jana Malinska's picture

A new global network of Climate Innovation Centers will support the most innovative private-sector solutions for climate change.
 
Pop quiz: What does an organic leather wallet have in common with a cookstove for making flatbread and a pile of recycled concrete?
 
Believe it or not, each of these represents something revolutionary: a private sector-driven approach to climate change. Each of these products – yes, even concrete – is produced by an innovative clean-tech company. And as of March 26th, those businesses, and hundreds more like them, have something else in common. They’re connected through infoDev's newly established global network of Climate Innovation Centers (CICs), an innovative project that is taking the idea of green innovation beyond borders.
 
Having piloted the CIC model in seven different countries – Kenya, South Africa, the Caribbean, Ethiopia, Morocco, Ghana and Vietnam – it was time for infoDev, a global entrepreneurship program in the World Bank Group’s Trade and Competitiveness Global Practice, to follow a time-honored business practice: to scale up and take this movement global.

And so, as part of last month’s South Africa Climate Innovation Conference, we joined forces with 14 experts from the seven different countries where the CICs operate to establish the foundations of the world’s first global network devoted to supporting green growth and clean-tech innovation.



CIC staff debate and discuss the new CIC Network during the South Africa Climate Innovation Conference.

This global network of Climate Innovation Centers – business incubators for small and medium-sized enterprises (SMEs) – has been designed to help local ventures take full advantage of the fast-growing clean-technology market. The infoDev study “Building Competitive Green Industries” estimates that over the next decade $6.4 trillion will be invested in clean technologies in developing countries. An even more promising fact is that, out of this amount, about $1.6 trillion represents future business opportunities for SMEs, which are important drivers of job creation and competitiveness in the clean-tech space.

'Mission-oriented' strategies to invest in innovation: Competitiveness via an enterprising public sector

Christopher Colford's picture
Mariana Mazzucato on "The Entrepreneurial State"


“This is the most extraordinary collection of talent, of human knowledge, that has ever been gathered – with the possible exception of when Thomas Jefferson dined alone.” That quip sprang readily to mind this week – it was coined in 1962 by President John F. Kennedy, when he welcomed a group of Nobel laureates to the White House – at a paradigm-shifting, synapse-snapping seminar featuring Prof. Mariana Mazzucato and other leading economics scholars, who convened for a think-tank symposium on innovation policy and competitiveness strategy.

The ideal of innovative, inclusive, green and sustainable economic growth is achievable, Mazzucato explained to the Information Technology and Innovation Foundation – if policymakers and private-sector firms recognize that a dynamic economy requires a “mission-oriented” approach to driving technological innovation. An acclaimed economist at the University of Sussex – and the author of, among other works,“The Entrepreneurial State: Debunking Public vs. Private Sector Myths” – Mazzucato is inspiring an increasingly wide-ranging debate over how to create higher-quality jobs in higher-value industries by sharpening economies’ competitiveness.

An essential driver of creativity is “the innovative state,” as Mazzucato recently detailed in an essay in the journal Foreign Affairs – through disciplined, deliberate public-sector investment, not just in basic research, but in risk-taking ventures as a key stimulant to economy-wide growth. That requires a forthright embrace of the public sector’s ability – and responsibility – to “actively shape and create markets, not just fix market failures.”

With a frisson of what one panelist called “the goosebump factor” enlivening the ITIF seminar – which was moderated by another top scholar of innovation and competitiveness, ITIF’s Rob Atkinson – the think-tank crowd heard Mazzucato outline the need for public-sector agencies to be, not just an occasional partner of private-sector firms, but a persistent driver of investment in leading-edge industries.

Industrial policy is finally back on the agenda,” Mazzucato asserted at the start of her ITIF remarks. Yet her vision of a competitiveness-minded public sector promoting a modernized version of industrial policy goes far beyond the long-ago experiments in heavy-handed planning that many free-market fundamentalists – forever in thrall to Thatcherism – still enjoy deriding as doomed attempts to “pick winners and losers.” Political Washington’s stale bickering over such a frozen-in-time caricature of industrial policy has long since been eclipsed, among economics scholars and practitioners, by the imaginative approaches of Mazzucato and others to energizing “the entrepreneurial state.”

Focusing the debate on the many pro-active instruments that the public sector can assert to help channel investment into innovation, Mazzucato hurled the defeatist “picking winners and losers” accusation back at the laissez-faire fatalists: “The question is not whether we should ‘pick’ but how.”

“The ‘entrepreneurial’ state, to me, means the state being willing and able to take on risk, to take on real fundamental uncertainty,” Mazzucato recently told The Financial Times. An enterprising public sector has often proven far more venturesome than short-term-focused private-sector firms, which often shy away from higher-risk, higher-reward investments that might diminish their next quarter's profits.   

“Venture capitalists themselves often enter [the innovation process] late in the game. In biotechnology, they actually came in after the state had made some of the most radical, revolutionary investments – which, after all, will often fail,” said Mazzucato. “And this is a very important point. Innovation is uncertain. It will often fail. So you need to make sure that the government budget can also fund some of the failures, cover the losses, as well as reap the return from some of the successes to fund the next round” of investments in innovation.

In his enthusiastic review of Mazzucato’s book, economics sage Martin Wolf of the Financial Times noted that energetic public-sector investment in innovation – and the abdication by private-sector firms of their oft-bragged-about, seldom-fulfilled role as bold risk-takers – has led to a “free-rider” problem that distorts incentives.

“Government has increasingly accepted that it funds the risks, while the private sector reaps the rewards,” wrote Wolf. “What is emerging, then, is not a truly symbiotic ecosystem of innovation, but a parasitic one, in which the most loss-making elements are socialised, while the profitmaking ones are largely privatised.” Neoclassical purists' continued scorn for the positive role of innovation-minded public-sector investment, Wolf reasoned, may be “the greatest threat to rising prosperity” in austerity-pinched Western economies.

Mazzucato’s analysis at ITIF reminded economy-watchers of how far the innovation-policy discussion has advanced, even as laissez-faire dogmatists belabor their weary bromides about the supposed taboo against “picking winners and losers.” Propelling a more nuanced vision of competitiveness strategy, as an improvement on earlier approaches to industrial policy, this week’s ITIF seminar advanced an enterprising agenda that Washington should weigh more often – analyzing not whether, but how, the public sector and the private sector can share the responsibility of crafting pro-growth policies and pro-jobs initiatives sans frontières. Meeting that challenge will require a paradigm-changing determination to champion an entrepreneurial public sector as a positive catalyst for creativity.

Mazzucato: "Value Creation" -- Dynamic Role for Government


 

The Hype and Hustle of African Tech Startups

Maja Andjelkovic's picture



This article was originally published in
SXSWorld Magazine
 
Hardly a day goes by without an African tech startup being featured in the mainstream media. CNN regularly updates its special report on the topic; The Guardian covers local debates surrounding emerging ecosystems; The Financial Times tracks Africa’s mobile revolution; Forbes has extended its “Top 10” series to include African female tech founders; Vanity Fair pins its hopes of “continental lift” on entrepreneurs. Blogs, opinion pieces and social media cover the sector in even more granular detail. Judging by VC4Africa’s 2015 report on venture finance, perspectives on African incubation and funding models, and the entrepreneurship program announced by Nigeria’s investor and philanthropist Toni Elumelu, it would seem that the African tech sector is among today's most dynamic industries.

Amid the buzz, many investors are asking: “Is the hype warranted?”

According to VC4Africa, an online community of very-early-stage startups and investors, investments through the platform more than doubled in 2014, rising from $12 million to $26.9 million, while the average investment grew from $130,000 to more than $200,000. Their research shows that 49 percent of ventures start generating revenue in their first year and that 44 percent are successful in securing external investment. More than 75 percent of these are in the technology sector, with agriculture, health, finance and energy startups also represented.

Further along the growth path, a smaller number of startups have recently netted over $300 million from a very diverse set of investors, according to CBInsights. 



Recent Investments in African Tech Startups
Adapted from: https://www.cbinsights.com/blog/african-tech-startups
 
At least eight companies have acquired growth capital in Kenya in 2014, along others in Nigeria, Egypt, Ghana, Tanzania and South Africa and elsewhere

New early-stage funds and angel networks in or focused on Africa are also on the rise. Among others, three models stand out: London-based NewGenAngels a collaboration between African and European networks (GAIN, EBAN and AAN); Kenya’s Savannah Fund, a partnership between Erik Hersman (iHub, Ushahidi and BRCK founder), i/o Ventures, 500startups and Draper Associates L.P.; and RENEW, linking American and African investors and startups.
 
Many early stage investors are still learning from their own experiences and adjusting their strategies accordingly. For instance, while most are bullish on Kenya’s tech scene, 88mph, an African seed fund has put further investments in Kenya on hold, while pursuing opportunities in Nigeria’s booming tech sector.
 
African entrepreneurship ecosystems have also benefited from a large number of technology incubators, accelerators and coworking spaces, connected through networks such as AfriLabs and backed by private sources, such as MEST in Ghana, and public-interest projects, such as infoDev’s mLabs and mHubs.
 
According to VC4Africa, the increase of capital is driven by three key trends: growing interest in startups from the African diaspora, the rise of local angel investors, and an increase in cross-border investments.
 
All of these instigate a positive change beyond investment returns; they set in motion a chain of opportunities in emerging and frontier economies. As Stella Kariuki, founder of Zege Technologies, once told me: “I want to be the change I want to see. [. . .] We build solutions that could be global but also solve African challenges practically.” Many of the startups serve consumers at the Base of the Pyramid -- the three billion people globally who live on less than US$2.50 per day, a market that is still largely underserved when it comes to basic services such as energy, education, health and banking.
 
It seems clear that investors and startups in Africa are getting to know each other better and are making more and better matches possible. This is an important step in reducing "the missing middle”: the absence of financing beyond the earliest stages of a company’s growth. As enterprises enter national or regional markets, their capital requirements increase exponentially. Without private and public sources of investment, these requirements stifle all but the independently wealthy entrepreneurs and those with established business networks. A diverse resource base for early-stage firms democratizes the opportunity for growth-oriented entrepreneurs and increases the overall potential of the local creative class.
 
So is now a good time to invest in African technology startups? The answer is yes, as long as investment decisions are made with care, patience, and in partnership with local investment communities.
 
Maja Andjelkovic co-leads the Digital Entrepreneurship Program at infoDev, a global program in the World Bank Group that supports growth-oriented entrepreneurship in emerging and frontier markets in the tech, climate and agribusiness sectors. Maja is interested in the potential of entrepreneurship to contribute to economic, environmental and social development. She has spent over 13 years connecting these fields, including as product manager in a web startup. She is a PhD student at The University of Oxford’s Internet Institute.
 
infoDev / the World Bank Group is organizing two sessions at Startup Village at SXSW Interactive 2015; one on the dilemmas and questions surrounding investing in tech startups in emerging markets, and the other on scaling up and accelerating technology innovation in Africa.
 
Angel investors interested in forming or growing their own local networks can benefit from practical advice and templates in a guide for angel investor groups published by the World Bank’s infoDev program and the Kauffman Foundation.
 
Sean Ding, Angela Bekkers and Jeremy Bauman contributed to the article.

The Genie in a Bottle: How Bottled Biogas Can Contribute to Reducing Kenya’s Dependence on Fossil Fuels

Edward Mungai's picture


Growing up, I always dreaded to enter my grandmother’s kitchen in the village. She used firewood to cook: There was such a dark, thick smoke in the room that I couldn’t breathe or keep my eyes open. I really don’t know how my grandmother could spend hours and hours in there, every day, for so many years. And unfortunately, my grandmother is not an isolated case. More than 90 percent of Kenya’s population uses firewood, charcoal or kerosene for their daily cooking needs.

I always dreamed that clean sources of energy would make Kenyans more independent and less exposed to the serious health risks posed by fossil fuels. In rural areas, most women like my grandmother rely on firewood; its consumption not only depletes our forests but also emits hazardous smoke that causes indoor pollution and eventually respiratory illness. In areas where firewood is scarce, women have to use cow dung as fuel, an option possibly even worse in terms of pollution. Urban areas are affected too: The poor rely mostly on charcoal, another biomass that has the same negative effects and health risks of firewood.
 
Cleaner fuel options have already been developed but are often too expensive or too difficult to transport across the country to be adopted by a large part of the population, especially by the 40 percent of people at the base of the pyramid.

So what can be done? How can we make clean fuels more affordable and accessible?
 
I first heard about bottled biogas when I visited a "green" slaughterhouse in Kiserian, Kenya. I was really impressed: My dream of a cleaner, more affordable and easily accessible fuel was right there before my eyes.

The Keekonyoike Slaughterhouse found an innovative way to produce affordable biogas and package it for distribution all around the country. Using a special bio-digester, this business can turn blood and waste from a community-based Maasai slaughterhouse into biogas for cooking. To facilitate transport, the firm stores the fuel in recycled cylinders and used tires, reducing even further the environmental impact of the operation. Just to give me a better idea of the "green" potential of his business, the manager told me that this first biogas plant is expected to cut methane emissions by more than 360,000 kilograms per year (the equivalent of almost 2,000 passenger vehicles).
 
Indeed, "bottled" biogas (biogas compressed into a cylinder) has huge potential in Kenya: Farmers can directly produce it, recycling the waste from their farms; can use it for their cooking needs; and, thanks to the bottling process, can sell the excess on the local market, generating income while saving the environment.
 
The Genie in the Bottle


Keekonyokie is a company that began operations in 1982. It runs an abattoir that slaughters about 100 cows per day to meet the meat demand in Nairobi and its environs. In 2008, with the support from GTZ, the company constructed two 20-foot-deep biogas digesters that would help manage the abattoir waste, which was becoming a menace and a health hazard. Within a short time, the biogas being produced from the digesters was more than the company could absorb. The company managers started thinking of compressing and bottling the excess biogas, but they needed support to test the technical and commercial viability of their idea.

When infoDev’s Kenya Climate Innovation Center (KCIC) opened its doors in October 2012, Keekonyokie was one of the first companies to be admitted.
 

Behind the Scenes of 'Startupland': A Documentary that Tells the True Stories of Entrepreneurs

Toni Kristian Eliasz's picture


Try to search for stories that feature the growing pains and gains of growth-oriented technology startups – content that is not only entertaining, but of high quality and most important, educating. It is a surprisingly hard task in today's economy, where entrepreneurship is booming again.

More efficient ways to transfer remittances are emerging. Are migrants and their families ready to benefit from them?

Massimo Cirasino's picture

The price of sending international remittances has reached a new record low in the first quarter of 2014. The global average cost of sending money across borders was recorded at 8.36 percent. This figure is used as a reference point for measuring progress toward achieving the so-called “5x5” objective – a goal endorsed by the G8 and G20 countries – to reduce the cost of sending remittances by five percentage points, to 5 percent, by the end of 2014.

Most indexes of international remittance costs – published by the World Bank in the new, ninth issue of the Remittance Prices Worldwide report, which was released on March 31 – indicate good progress in the market for remittances.

The global average cost is significantly lower when weighted by the volume of money that flows in each of the report’s country-to-country pairs. The weighted average cost is now down to 5.91 percent, following a further decline in the last quarter. For the first time, the weighted average has fallen below 6 percent.

Nearly one-third of the remittance-sending countries included in Remittance Prices Worldwide have now achieved a reduction of at least 3 percentage points. Those countries include such major sources of remittances as Australia, Canada, Germany, Italy and Japan. This is also the case for 39 out of 89 of the remittance-receiving countries.

Female Entrepreneurship: What Support Programs Should Do (and What They Should Avoid Doing)

Xavier Cirera's picture
Take a look at the nine points listed below, and think about the various support programs for women entrepreneurs that you may be familiar with. Have you seen these factors before?
 
  • Ignore gender differences
  • Create curriculum around PowerPoint (Stand and deliver)
  • Emphasis on existing idea or opportunity
  • Use of big business examples
  • Use of industry standards
  • Reliance on banks as start-up funds
  • Primarily including male instructors and speakers
  • Assumptions about firm size
  • Assumptions about linearity of growth


This is a list of what NOT to do when designing and implementing successful support programs for women entrepreneurs, as suggested by Prof. Patricia Greene of Babson College at a recent presentation at the World Bank Group. Her seminar was the first in a series on "Women Entrepreneurs: A New Approach to Growth and Shared Prosperity."

Helping Green Business in the Caribbean

Herbert Samuel's picture


Increased hurricane activity and rising sea levels are well-known effects of climate change, and they prompt solemn head-shaking when we read about them in reports. But in the Caribbean they are part of a terrifying reality that is happening now: This reality was demonstrated again by recent flooding and landslides in the Eastern Caribbean that left 20 dead and hundreds of millions of dollars in damage.

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