From November 12 to 19, the World Bank Group celebrated Global Entrepreneurship Week (GEW) with a series of events focused on the role of entrepreneurship for development. More than 500 entrepreneurs, academics and practitioners gathered from all over the world to discuss one key question: What does entrepreneurship look like in developing countries?
After listening to experts presenting their research and entrepreneurs discussing their inspiring stories, I believe the question has multiple answers. Like the GEW logo — a multicolor compass — entrepreneurship is a spectrum that embraces different realities, from social enterprises and community-led businesses to young startups and multinational firms.
So what’s the color of entrepreneurship?
To aspiring entrepreneurs around Cape Town, South Africa, entrepreneurship probably looks red. Red like the logo of the local RLab, a center founded in 2008 by Marlon Parker — a World Economic Forum Young Global Leader and an alumnus of President Obama's Young African Leaders initiative — to empower local communities through impact investing and social enterprise incubation.
Opening the Global Entrepreneurship Forum, Marlon talked about his mission to build “economies of hope.” In his welcoming incubation space, painted in a warm red, unemployed people, students and dropouts can experiment with new technologies, connect with mentors and participate in training programs to learn everything they need to launch a local business. His model incubates new enterprises within the community, with the community and for the community. Marlon has even introduced a local “reward currency”: a credit that can be earned only by doing good actions within the community and that, like real cash, can be spent at the Rlab and in participating stores.
But what conditions enable local businesses to reach regional or even global scale? This question was the focus of “From Start-ups to Scale-ups: the Realities of Growth Entrepreneurship,” a seminar organized by the World Bank Group in partnership with the Brookings Institution and the Global Entrepreneurship Research Network.
The event gathered academics and experts on entrepreneurship from across the world — including Anne Habiby, co-CEO and co-founder of AllWorld Network; Mirjam van Praag of the University of Copenhagen; Erkko Autio from Imperial College in London; and Wong Poh Kam of the National University of Singapore, just to name a few.
A major point of consensus emerged from the discussion: Government institutions play an essential role in supporting high-growth entrepreneurs. Whether this simply means ensuring a level playing field by limiting corruption or implementing more structured reforms that facilitate access to finance, panelists agreed that the World Bank Group is uniquely positioned to work with governments to create an enabling environment for high-growth firms in developing economies. This process of growing “entrepreneurial ecosystems” will be further analyzed in an upcoming World Bank Group publication.
From compelling research findings to concrete examples of entrepreneurship, the third event of the week, the World Bank Group’s Youth Summit, focused on the vibrant world of “millennial” tech startups. At the event, a group of talented young entrepreneurs between the ages of 18 and 35 pitched their startups’ solutions for climate change. I had the pleasure of being one of the four judges who awarded the first prize of the competition to Michael Eschmann, an entrepreneur from Switzerland who is working with communities in rural India.
To Michael, entrepreneurship looks yellow — bright like the sunlight that inspired his business concept. To meet the growing energy needs of Indian farmers, Michael and his team are launching HELIOS, a project that aims to develop and commercialize solar-powered irrigation systems across the country. Their idea is promising: Michael estimates that the installation of 10,000 systems could help mitigate 30,000 tons of CO2 emissions — equivalent to the annual emissions of 6,300 cars — and increase farmers’ income by cutting up to $300 per year in diesel costs.
SMEs and startups like Michael’s can often embrace more easily the “disruptive” entrepreneurial approach required to address challenges like climate change and access to energy. Compared to large and established companies, nascent firms have the flexibility to experiment with new business models, enter under-served markets, and take on technology risks. This approach fosters sector-wide innovation, competitiveness and, most important, investment: The clean-tech market for startups and SMEs in developing countries alone is expected to reach as much as $1.6 trillion by 2023.
On the stage: Pitch competition judges (on the left) and the six finalists; Michael Eschmann from Helios is second from the right.
Finally, at the last event of the week, entrepreneurship came in a solid green. The Climate Action and Green Competitiveness Conference offered a few examples of a third category of competitive enterprises: established companies “going green” to make sustainability a key driver of innovation and differentiation on the market. Hakan Bulgurlu, CEO of Arçelik — a major household appliances manufacturer in Turkey — argued that companies must constantly strive to be on the leading edge of sustainability in order to compete in the market in the long run. It’s not only a matter of environmental responsibility. Better talent and customer acquisition, greater efficiency, and increased stability of operations are just a few of the competitive advantages of this next generation of green companies.
Green, yellow, and red; social enterprises, tech startups, and large firms. No matter the category of entrepreneurship under discussion, the take-home message from the week is clear: Enterprises that pro-actively seize opportunities presented by innovative technologies, and that have sustainability and the well-being of local communities at the core of their business, will probably see pronounced growth and development. Those that don’t, by contrast, may see their profits and competitive edge vanish quickly.
To ensure that a growing number of companies become champions of sustainability and growth, the World Bank Group’s Trade & Competitiveness Global Practice works with governments and the private sector to strengthen innovation and technology policies, growth strategies and financing. A diverse set of programs supports entrepreneurship across different sectors and stages — from startups and SMEs to more mature and established firms. Programs like the Digital Entrepreneurship Program, the Climate Efficient Industries initiative and the Climate Technology Program are helping dozens of countries increase industrial efficiency and scale innovative and sustainable businesses in high-growth sectors, like agribusiness, tourism and manufacturing.
Like the color spectrum, entrepreneurship embraces different realities, all equally important for the development of competitive and inclusive economies. It’s our job to provide targeted support across different categories of enterprises by adapting our tools and strategies to their different needs, challenges and opportunities for growth.