Pick any country in the developing world.
Where are the women entrepreneurs in Pakistan?
They start and manage digital-content creation firms serving international clients. They are sole proprietors of construction businesses bidding for government projects. They supervise tailors and embroiderers in windowless storage rooms that double as stitching units. They export high-end gems and jewelry around the world.
Women entrepreneurs in Pakistan lead cutting-edge, innovative businesses – but there are far too few of them. The recent Global Entrepreneurship Monitor report finds that only 1 percent of Pakistani women are engaged in entrepreneurship – the lowest proportion in the world.
Pakistan is not alone in its dismal ratio of growth-oriented (or indeed any kind of) women entrepreneurs. Even in the developed Asian economies of Korea and Japan, only about 2 percent of women are entrepreneurs. Sub-Saharan Africa does much better in this regard, with 27 percent of women, on average, engaged in entrepreneurship -- but they are mostly involved in low-productivity sectors of the economy.
Women entrepreneurs, in Pakistan and globally, have narrow networks of friends and family who provide them with some initial capital to start their small businesses, with little expectation of further financial support. Their export customers are located wherever they have extended family. And they rarely feature in local chambers of commerce activities.
Banks are often reluctant to extend lines of credit to, provide working capital to or lend to women-led enterprises. This makes it difficult for these enterprises to pursue growth. Perhaps this is why the average growth projections for women-led enterprises are seven to nine percentage points below those for their male counterparts.
We had an interesting experiment last month with our very first Development Slam – modeled on the idea of a Poetry Slam – that was held with Aspen Institute’s New Voices Fellows and the World Bank Group’s storytellers.
The Slam allowed people to share their experiences in an interactive way with their peers and allowed the audience to participate as well via an open mic.
“If you cannot do great things, do small things in a great way.” - Napoleon Hill
Eight Commonwealth Asian Nations joined hands to discuss the contemporary needs of young entrepreneurs in the region at the Commonwealth Asia Alliances of Young Entrepreneurs (CAAYE) Summit held in Colombo, Sri Lanka from the 9th - 11th of November, in parallel to the Commonwealth Heads of Governments Meetings (CHOGM). The theme of the summit was highlighted as “Profit with a Purpose” which argued around its key objectives in promoting an ecosystem that supports the development of young entrepreneurs who contribute to economic, social and environmental sustainability across CAAYE countries. CAAYE 2013 was hosted by the Federation Chamber of Commerce and Industry Sri Lanka (FCCISL) in partnership with the Commonwealth Secretariat.
South Asia concurrently holds the greatest opportunities and the risks of been responsible for the world’s largest youth populations in transition, therefore facing reality and addressing those contemporary needs should be key to those respective stakeholders such as governments, for a more stable and prosperous economy. Common challenges faced by young entrepreneurs in Asia are “fundamentals” concerns, which could easily been eliminated if there is right focus and continuous review by the relevant authorities in these countries. Those concerns that caught my eye included the need for updated knowledge and curriculum development at all level, need to not jail but celebrate failure, revamping of “extensive” government and organizational procedures allowing to reduce the lead time.
When it comes to financing for entrepreneurs, this week marked a major event in the financial industry of the United States with immense potential ramifications for the developing world. This week, the US Securities and Exchange Commission’s unanimously approved rules for equity crowdfunding.
For context, equity crowdfunding allows entrepreneurs to sell equity shares of their company to a group of investors through an internet platform, and is a distinct category of crowdfunding apart from micro-finance (Kiva), perks-based (Indiegogo), and debt (Lending Club). The most notable crowdfunding website is Kickstarter which since 2009 has raised more than $840 million, from more than 5 million people, funding 50,000 creative projects. This platform operates on a pre-sale, perks or donation model where funders contribute funds for a future product, reward, or in-kind. Shares or equity were, until the SEC ruling, not part of the deal.
If we hold true that this SEC measure represents a seismic shift in the way entrepreneurs can raise funds in the United States, the question remains, can emerging markets leap frog the developed world to democratize access to finance for entrepreneurs in their countries?
The answer, we believe, is yes.
Brace yourself for some dramatic new evidence about innovation and entrepreneurship – and and circle the dates October 16 and 17 on your calendar.
Propelling leading-edge ideas about competitiveness, Professor Mariana Mazzucato will be among the luminaries at a major conference at the World Bank in mid-October, organized by the Bank's global practice on Competitive Industries. An all-star array of policymakers, academics, business leaders and development practitioners will focus on today's top global economic-policy challenge: spurring growth and job creation.
Exploring “Making Growth Happen: Implementing Policies for Competitive Industries,” the conference in the Bank's Preston Auditorium will include Mazzucato among
some of the world’s foremost analysts of competitiveness. A professor at the University of Sussex in the U.K., Mazzucato’s iconoclastic new book – “The Entrepreneurial State: Debunking Public vs. Private Sector Myths” – is now rocking the economics world. Mazzucato's insights are forcing a rethinking about the essential role of the public sector in driving the investments that are shaping the modern economy.
Public sector? Shaping the economy? Yes, you read that right: Mazzucato amasses persuasive evidence that the government-funded development and deployment of advanced technologies has been pivotal in changing the economic landscape.
Government’s role as a growth catalyst has been just as creative as the role of the private sector – and perhaps even more venturesome. Despite their buccaneering bravado, for-profit firms have lately shied away from high-stakes, high-risk investments in unproven technologies. Mazzucato refutes the defeatist dogma that claims, falsely, that public-sector investment can never do anything right.
“You have a good social project, but it is not an investable company”, I heard fellow judge and technology activist Mariéme Jamme say to a South African entrepreneur who had just given his best business pitch. He was taking part in the Dragons’ Den at the 5th Global Forum on Innovation and Technology Entrepreneurship, a fantastic 3-day learning and networking event organized by the World Bank’s infoDev and the South African Department of Science and Technology. You could see the entrepreneur (let’s call him ‘B.’) gasping for air, and one could hear a pin drop in the completely filled auditorium of the Global Forum. Over 800 people, mostly entrepreneurs, financiers, policy makers and technology ‘evangelists’ from all over the world had gathered here.
How are emerging market entrepreneurs leveraging technology and changing development paradigms? Why are the rewards of funding innovative new ventures in emerging economies worth the risks, and what makes these investments succeed? How can investors, policy makers, and the private sector in general help find and groom transformative high-growth enterprises?
Join Thrishantha and other experts on the World Bank Sri Lanka Facebook page on April 2nd at at 4PM Colombo Time for a live chat on innovation!
One day, I was driving in a remote town in Sri Lanka, when I saw this encouraging scene. A few school kids were playing cricket on a rainy day, and they had made a wicket out of three umbrellas. It might look simple, but a very powerful message about innovation is hidden right there. An innovator in my view is somebody who practices to ask two simple questions: 1) is there a better way to do this, or simply, is there a way to do this? 2) why did it happen that way? The second question is driven by the curiosity to learn the rules of nature, while the first question is driven by a very healthy attitude to get things done by exploiting the rules of nature. The kids who used the three umbrellas for a wicket simply asked if they could find something in their environment to serve the purpose of a wicket. Quite subconsciously, these kids, by embedding in nature, by walking barefooted on mud, grass, and sand, have mirrored natural laws of nature in their brains, that provided them with the basis to change the utility of an umbrella to a stump of a wicket. Therefore, in my view, best innovators are those who are active outside the classroom as well as in the classroom and laboratories.