Going Beyond Networking - Launching a Venture in the Base of the Pyramid

"How do I get the resources I need to start my BOP business?"

This question came up in a recent discussion with a colleague from the Univeristy of North Carolina. Dozens of students graduate each year from UNC's Kenan-Flagler Business School with a top-rated MBA degree and a passion to pursue Base of the Pyramid (BOP) opportunities, but few companies are hiring for these types of positions. You can always start your own business, but how does an aspiring entrepreneur from the top of the pyramid attract the resources needed to launch a new business in the BOP?

Just like any other entrepreneurial endeavor, it's all about building credibility.

Credibility gives your entrepreneurial idea the power it needs to become a true business innovation. The higher your credibility, the higher your probability of finding funding, partners, customers, etc: i.e. all the resources you need to get going. The farther afield you are going in terms of geography, expertise or industry, the farther you have to build up your credibility to win the resources your venture needs. MBAs are taught how to do business planning and how to detail the growth of our companies, but rarely do we think of the same step-by-step methodology to plan the growth of our credibility and how we will pay for our learning curve. And credibility is critically important in the Base of the Pyramid where ideas greatly outnumber available funding*.

David Bornstein, who chronicles social entrepreneurs in his acclaimed book "How to Change the World", offers a description of this process. Bornstein states that social entrepreneurs typically start with what they know and issues they feel passionate about:

Social entrepreneurs, like business entrepreneurs, should begin with what they know best and should focus on an idea or issue that resonates deeply in their lives. Entrepreneurs rarely come up with their ideas suddenly. Typically, they spend years thinking about them--often searching for the right moment in their lives to move forward. Sometimes their ideas can be traced all the way back to childhood interests.

The budding social entrepreneurs then go through a stage of credibility building.

Before starting out on their own, they often work in jobs that teach them how a particular type of business or industry operates. Social entrepreneurs go through the same types of "apprenticeships." They usually work for several years in a particular field, profession or organization, acquiring the knowledge, skills and contacts that enable them to branch out on their own and improve upon what is currently being done. Then they enter the "launch" phase--when they start preparing to build their own organizations. Again, like business entrepreneurs, social entrepreneurs usually begin by tapping their personal networks--friends, families, colleagues, teachers, mentors. They often start with a few well-selected tests of their ideas--to demonstrate early viability--and build credibility and momentum. They enlist advice from well-connected and experienced allies about how to raise funding, think through strategy, and build a team of supporters and advisors.

For MBAs and others starting ventures in the BOP, creating a series of projects to build relationships in your target area is critical. Even if these projects are volunteer or charitable works, the credibility you build will be invaluable. For example, here at BRINQ, we seek to gain experience in new markets by running small toy-design contests with local non-profits, helping us to build the relationships and credibility we need to promote our commercial "sow & gather" approach to innovation. For another example, take a look at Theresa Williamson in Rio, Brazil, described as a "powerhouse" by WorldChanging.com. Williamson founded her high-impact "Catalytic Communities" four years ago as her doctoral thesis at the University of Pennsylvania. Williamson recounts her own learning curve in detail in her dissertation "Catalytic Communities: the Birth of a Dot Org" (PDF).

The key lesson to learn is that when you're starting with very little and need the most help, you have to find ways to give the most help you can. And not just to the people you want to serve, but to the people you most want to partner with. You need to go beyond networking to credibility building. Afterall, you measure your network by the number of people you can call when facing a problem, but you measure your credibility by the number of people who will call you.

And when people start calling, the resources will follow.

* To illustrate the scarcity of funding, BRINQ recently made it to the semifinal round for Echoing Green funding. Echoing Green is one of the few organizations that will consider funding "for-profit" socially oriented ventures. We were one of 700 groups Echoing Green was considering for funding in 2005, we're now one of 150. Echoing Green will eventually select 12 organizations to fund, a funding rate of under 2%.



Excerpt from "Theodore Roosevelt on caring"
"Nobody cares how much you know, until they know how much you care."

Are you feeling the increased pressure of the tough economy? You will. And when it hits you, I have a very effective way for you to handle the inevitable stress: Care more and worry less.

Came across the above article and Teddy Roosevelt quote on Tom Asacker's blog. Care more, worry less is a great way way to remember to give more when you need the most.