The impact imperative
“Social entrepreneurship is the biggest and most important form of entrepreneurship on the planet,” said Stephan Chambers, chair of the Skoll Centre for Social Entrepreneurship at the University of Oxford.
Chambers was addressing an auditorium of entrepreneurs of all ages at the Gordon Institute of Business Science (GIBS) in Illovo, Sandton, on February 2, as part of a partnership between GIBS and the Mail & Guardian to promote the role of entrepreneurs and share advances in this field that have taken place across the globe.
“[Being an] entrepreneur is an imperative, not an option,” said Chambers. “Governments and states are withdrawing from the public realm all over the world, even when we expect them to provide such social support as power, water, security, employment and health. Reliance on states and governments to be able to live a civilised and safe life is not a safe bet in our lifetime.
“The poorest countries in the world have the most entrepreneurs. If the state cannot support you or you cannot find formal employment, you will find another way to generate income.
“We live in a world of unparalleled correlation and risk. Things that are happening encompass finance, poverty and migration and the risks emerging are existential and correlating.
“My contention is that we know we can do more and speak to each other as [we were] never able to do before. We have more access to knowledge through such mediums as the internet and television and know about such aspects as bio-engineering, quantum engineering and medicine. The outcome of knowledge about these things, we know to be profoundly positive for humanity.
“Thanks to this communication, there is an enlightened combination of the entrepreneur and corporations that contribute distribution, mechanics, technology and infrastructure via contacts and government.”
Chambers cited an example of “lots of clever people, betting on being what they think it will be” as the company M-KOPA Solar, headquartered in Nairobi, Kenya. It is a major utility provider across countries, making solar products affordable to low-income households on a pay-per-use instalment plan, and claims to be the global leader of pay-as-you-go energy for off-grid customers. Since its launch in 2012, M-KOPA has connected more than 280 000 homes in Kenya, Tanzania and Uganda to solar power and claims it is adding power to over 500 new homes each day.
Customers acquire solar systems for a small deposit and then purchase daily usage credits for less than the price of traditional kerosene lighting. After one year of payments customers own their solar systems outright and can upgrade to more power. All revenues are collected in real-time via mobile money systems, and embedded GSM sensors in each solar system allow M-KOPA to monitor real time performance and regulate usage based upon payments. This connected design means that M-KOPA is processing vast amounts of data: over 10 000 mobile payments per day.
“In my view, this demonstrates [the] real promise of social entrepreneurship,” said Chambers. “There is at least the possibility that Africa will leap-frog [over] where we are in Western Europe and northern America, with the really big prize being changing the way business gets done.
“The social bit is the easiest bit. If we are still having a conference about this in three years, we [would] have failed to convince the world and failed to provide perspective to business that negative externalities can be dealt with. The agenda needs to resolve itself to the macro story and we should take the social injustice story as a given.”
Chambers said that humans by and large are created for doing good, but said the time has ended to “major on how virtuous you are as human beings. You need to focus on how inventive you can be”.
“We have come to the end of a historical movement of virtuousness that started in the Victorian era where the rich gave to the poor — a movement with its own set of problems, starting with getting us off the discipline hook.”
He contends that humans are almost “preposterously created” to help inventing and show the by-product or necessary element of creativity. “Invention is a profound commercial service to social justice and a contributor to the absence of disease, poverty and forced migration.”
Asked to define what entrepreneurs do, Chambers said this: “Getting stuff done without owning or controlling the means to get stuff done. If you control people and seek to occupy a hierarchical structure, you are not a classic entrepreneur.
“I care deeply how inventive, creative and resourceful entrepreneurs are getting things done. With the right mix of stubbornness, resilience, creativity and connections, an entrepreneur will succeed.
“Entrepreneurs also need to teach government and corporations in [positions of] social power to address and innovate around market failures; to be more resourceful without appealing to virtuous interventions.
“Economists believe there is equilibrium between supply and demand. However, even economists understand that markets cannot work everywhere. One example is antiretroviral therapy for HIV. We know supply can meet demand, but this is not happening.”
Chambers said that businesses should work around negative external issues and influences. He painted a scenario of businessmen sitting in boardrooms scratching their heads, trying to address their social responsibility problems, urging them to rather talk to entrepreneurs, who can help bridge gaps.
“Financial services are an example of being very, very slow to innovate and implement. There are so many opportunities for the entrepreneur to work with the ‘unbanked’ sector of the population, as they are a huge factor.
“There is also the need for collaboration versus competition. We have the famous model of markets that are captured by investor returns, but evaluate the effect, if we look at Tesla — the company that spent billions on research and development of car battery technology, which made this technology open to every other car manufacturer in the world — to change the world. This is a very ‘uncapitalistic’ thing to do,” said Chambers.
“Vested interests will not be solved without provocation by entrepreneurs. Look in spaces in markets where the rewards do exist.”