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Sustaining Entrepreneurship

  Feb 3, 2012
 

Dalberg, a strategic advisory firm together and Strathmore Business School (SBS) hosted a breakfast for entrepreneurs drawn from various sectors of the economy on Thursday, 26th January. Dalberg works to raise the living standards in developing countries and address global challenges that revolve around the issues that retard economic and social development.

The main objective of the breakfast was to create awareness of the G20 challenge where a business that adopts an inclusive business model will be selected and showcased during the prestigious G20 summit to be held this June in Mexico.

An Inclusive Business Model

Speaking as one of the panelists at the breakfast, SBS’s Founding Dean and Deputy Vice Chancellor of Strathmore University, Dr George Njenga stressed that “we should not see development through the eyes of the how the economy is performing; rather, see it in the eyes of the common good. Meeting the needs of the common mwananchi (citizen) and sustaining that will put us as developing countries in the right route”.

The panelists, who represented different sectors, stressed the importance of running an inclusive business model taking into account those considered to be at the base of the pyramid.

 

Mr Francis Njogu, the CEO of Gulf Energy, a leading oil and gas supplier in Kenya emphasized that there is latent purchasing power in the BOP (Bottom of the Pyramid) and that companies just need to know how to package products to make them affordable.

There are 17 million mobile handsets in Kenya, and yet 85% of all urban households are still using biomass (mostly charcoal) and kerosene for cooking because they cannot afford liquid petroleum gas as it is currently packaged.

Mr Nduati Kariuki, the Chairman of Kenya National Federation of Agricultural Producers (KENFAP), talked about the innovations taking place in the sector and the need to turn agriculture into a “business and not just a form of subsistence.”

Mr Kariuki emphasized that there is a need to make agriculture attractive to young people to get them involved in farming, and the way to do this would be to link primary agriculture with value addition services such as processing, packaging, and marketing.

To illustrate the importance of value adding services, he gave the example of coffee. He observed that whereas coffee in the US goes for $20/kg, a coffee farmer in Kenya only gets $ 80/kg.

The huge difference in prices is because once the beverage is processed and packaged, its value appreciates dramatically. Sadly, the small scale farmer in Kenya is not able to add this value to his product.

Dr Njenga observed that education is the key to growing inclusive business. He emphasized that economically it makes most sense to focus on the common good for all people. This is why SBS is focusing on creating education programs that prepare the key decision makers to work in sectors that can impact people from all walks of life.

Dr Njenga emphasized that in Kenya and Africa we are lacking enough technical experts to help us effectively compete in the global market especially in fields such as agribusiness that need people with both business acumen and technological knowhow. He said that SBS aims to create and mould such leaders.

Mr Biju ohandas, the Director of Acumen Fund in East Africa echoed Dr Njenga’s sentiments on the importance of leadership in growing social entrepreneurship in the region. The Acumen Fellows Program does exactly this by seconding brilliant individuals to businesses that are working with the poorest of the poor.

Other sponsors of the breakfast included IFC (International Finance Corporation), and KSix (Kenya Social Investment eXchange).

About the G20 Challenge

The Group of 20 (G20), together with the International Finance Corporation (IFC), launched the G20 Challenge on Inclusive Business Innovation, an online competition that seeks to find the best examples worldwide of businesses with innovative, scalable, and commercially viable ways of working with low-income people in developing countries, such as Kenya and many other African countries.

The G20 Challenge will recognize successful inclusive business ventures, and provide a global platform for all businesses to learn from successful leaders in this growing field. The winning business models will be showcased at the G20 Leaders Summit in Mexico in June 2012. (Source: http://www.inclusivebusiness.org/2011/11/g20-challenge-on-inclusive-business-innovation.html)

A panel that will incorporate members from the G20 (Group of 20 major economies), private sector, academia, foundations and international finance institutions will select up to 15 challenge winners based on:

  • Innovation
  • Development results
  • Potential for growth, including replication of the business model in other markets
  • Financial sustainability
  • Environmental and social sustainability


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