The Legatum Center for Development and Entrepreneurship at MIT in Boston was set up as a fellowship program to help MIT students build and scale their ventures through “principled, entrepreneurial leadership”. The center also provides seed grants and travel expenses for “students looking to explore and experience global innovation-driven entrepreneurship (IDE) opportunities”, as well as research grants and assistantships for the faculty and its students.
On Tuesday, representatives from the Legatum Center rolled into London – the Level 39 FinTech Accelerator in Canary Wharf, to be precise, to run the conference Accelerating Developing World Growth through Entrepreneurship and Finance.
The purpose of this full-day event was to explore the intersection between IDEs as a transmission mechanism for bringing innovation to impact, their reliance on outside “risk capital” and specialized entrepreneurial finance – there tend to be more entrepreneurs with innovative ideas than there is funding to back them – and getting ideas to impact.
Although the Legatum Center has a sister institute that is based in London, the city represents new territory for the institute – it was chosen partly thanks to the number of Britons to have joined the Center’s ranks – Fiona Murray, for example, who opened proceedings with a welcoming speech, is Associate Dean for Innovation at MIT Sloan, and Faculty Director of the MIT Legatum Center.
After Murray discussed the Institute and its work, and how the scientific and technical innovation it promotes can help to create innovative enterprises that drive jobs, economic development, wealth creation and regional prosperity in areas that need it the most, she handed over to Ben Brabyn, the Head of Level 39.
Delighted to welcome the conference, Brabyn also emphasised the diversity that makes London such a unique, culturally enriched, and entrepreneur driven society. “In London, you will meet and talk with people that are different to you”, he said – “it’s about embracing that difference, listening, learning, and adding to it.”
And so, to the first presentations.
Adetayo Bamiduro is the co-founder of MAX – last mile delivery. MAX stands for Metro Africa Express – the hyperlocal, retail and delivery mobile platform developed by the founders at MIT. MAX uses disruptive technology to guarantee 30-minute food delivery, 3-hour package delivery – whilst in the pipeline, new features to be rolled out between now and 2020 include using routing data from delivery routes to create a high performance urban mobility and proprietary addressing platform for the whole of Africa.
Bamiduro’s parents, he told the audience, came from a scientific (his father) and government career backgrounds, so to take on a challenge as entrepreneurial as this was, for Bamiduro, to take a step into the unknown. Perhaps this aspect of founding a company, putting the theory learned at a top academic establishment into practice, especially in a continent as lacking in basic infrastructure as Africa, is the trickiest, albeit certainly the most the most thrilling, part of launching a business.
Hence the reason impact funding is so essential. Without a funding runway, how can a business scale fast enough to realise the dreams of its founders? Business plans may be written in ivory towers, but it is in real life, and particularly the lives of those struggling to find gainful employment in some of the harshest economic climes in the world, where the effects of IDEs are most keenly felt, and most rewarding.
Bamiduro’s story was echoed by other presenters – Ella Peinovich is Founder and CEO of Soko, a start-up that works “at the intersection of art and technology”. After spending seven years working with social enterprises inside informal economies, Ella relocated to Nairobi where, as CEO of Soko, she helps connect mobile enabled artisans from developing countries directly to brands, retailers and online customers around the world.
Ella told the conference the heart-rending story of an impoverished Kenyan lady, who went from selling goods that she had made – perfectly built, beautiful jewellery, on the side of a dirt track, to placing some of her wares on the sites of top fashion designers with a global reach. From poverty, to being able to provide for her family – by doing an activity that she loved – surely this is how all start-ups should work? Soko are currently raising a round of Series A funding to further enhance the platform.
It’s worth taking a moment to explain and examine the phenomenon of impact capital. Impact capital is capital that is injected into a business where the results can be measured to determine what kind of social impact is made. It is increasingly common, in our society, to hear people discussing the social implications of their businesses – to want not just to turn a profit, but to make a difference to communities and societies.
This is a good thing – we have all become used to hearing entrepreneurs and founders talking about “changing the world” – but in practice it can be hard to achieve.
This was broadly the theme of the panel discussions that were conducted during the afternoon. Kenyan entrepreneur Angela Nzioki, co-founder of Plus People Kenya, an IT services provider focused on the financial inclusion sector, joined Gayle Peterson, co-founder and senior managing director at non-profit Social Impact consultancy Partners for Change (pfc), and Alan McCormick, MD of the Legatum Group, a private global investment firm headquartered in Dubai, in a discussion chaired by Fiona Murray, to discuss Philanthropic Capital and how best it can be applied for, and if secured, utilised.
McCormick made the point that, in many respects the most important change that needs to happen must occur within the minds of members of under-developed communities and countries. Simply realising that it is possible to improve one’s lot is to take a huge step on the path towards progress, but for those used to corruption, to seeing government money squandered and entrepreneurs come and go without achieving anything of substance, it must be disheartening in the extreme.
But this is the world that entrepreneurs operate in, and perseverance, self-belief and determination are as important as “game changing” technologies and disruptive business strategies.
Crowdfunding is playing an increasingly influential role in engineering change, and change of a social nature, in the UK, but it is by no means a Britain-only innovation. Francesca O’Brien, the Head of Private Markets at Syndicate Room, joined Fernanda de Velasco, the Co-founder and CEO of Play Business, a crowdfunding platform operating out of Mexico but with a global reach, and Benjamin Samuels of Homestrings, an African-based business expanding into international investments and crowdfunding, to discuss how to enable and enhance global crowdfunding.
Samer Sulty, founder and CEO of Zouk Capital, joined Deborah Drake, VP of Investing in Inclusive Finance (IIF) and Chris Cusack, Manager of Vilcap Communities Global to discuss how to access, and fund, African Markets. In an earlier discussion, Timothy Barnes, Head of Enterprise at Loughborough University, chatted to Kamal Bhattacharya, CEO if iHUB in Nairobi, a community space for start-ups and investors, Hayaatun Sillem, Director of Strategy at the Royal Academy of Engineering, and about seed stage capital and innovation.
Shanker Singham, Director of Economic Policy and Prosperity at the Legatum Instititute, spoke about prospects for global aid and trade, and supporting innovation driven entrepreneurship, before departing for the House of Lords, where he was due to offer a view on pre-and-post Brexit strategy. Rather him than us!
Without question, attendees left knowing a great deal more about social impact capital, and the expectations placed upon entrepreneurs who seek it, than when they arrived, but they may also have found they left with as many questions as answers.
Such is the role of the conference, and the Legatum Centre were correct in presenting the day as the beginning of a conversation rather than a roadmap for success.
In the event blurb, it was suggested the conference could “build on MIT’s tradition of taking an ‘action learning’ approach to understanding and solving problems”, and that MIT’s goal from this first conference is to “have a set of action-oriented follow-up items for further research and discussion.”
Did they achieve it? It would be hard to judge otherwise given the enthusiastic networking that lasted for a full 2 hours after the final conclusions were drawn.
From Michael Ng, marketing manager at Doreming Ltd, which provides financing to employees in advance of payday to help them access capital when they need it, to Ismail Malik, a serial entrepreneur who’s latest venture, Smart Ledger provides accounting software, the conversations ranged from the early days of the internet, when cables were being laid all over, or rather under Shoreditch, a decade or more before the advent of the “Tech City” phenomenon, to how to effectively measure social impact, to the rigours of running a start-up.
In a year’s time, it is to be hoped the Legatum Center Staff and alumni make another trip to London, and also to be hoped that they have plenty of “homework” to assess and a host of new emergent success stories, (look out for “Uber for cows”, an exhibitor at the conference, currently based out of the Kings College business accelerator), to reflect upon, and assist with their financing needs.