Today, I watched many videos by Tarun Khanna, about his experience in southern India, and his explanations as to how the struggles of people and systems in developing nations could be seen as entrepreneurial opportunities. Personally, I found the videos to be very enlightening, as they showed how a single experience could demonstrate a potential need that an entrepreneur could fill in order to improve the lives of people while making a profit.
The story made me think about insurmountable obstacles as entrepreneurial opportunities. In theory, the developing world presents a huge array of opportunities for those with talent, time, and money to invest into the project. The majority of the world’s population lives either in poor or developing countries with plenty of institutional issues that the people of first-world countries take for granted. So, why aren’t these opportunities seized by multinational multi-billion corporations, or even medium-sized businesses from the first world, that are looking to expand? The possibility of going into the Blue Ocean and carving a piece of the market there is much safer than trying to compete with one another in the oversaturated western markets, correct?
I think the reason why there are not many individual entrepreneurs or organizations willing to jump at the opportunity to make the lives of people there better and make a profit is because of the obstacles surrounding building up such a system. Khanna covers this in the part about corruption. The corrupt government would often put hurdles in front of businesses, and threaten potential investments. It could even push out foreign competition in order to favor their own, less efficient and capable businesses, using protectionist measures. This is already being done in countries like China, India, and Russia.
I can imagine that cultural and language barriers also play a role. Being a foreigner, I would view certain issues as problems, whereas the locals would have been used to it and not want to change. For example, the number of abortion clinics in many Muslim countries is very low, whereas their population growth rates are high. Western logic would dictate that opening a clinic there would yield great profits while answering a potential need.
However, part the reason why abortions are not popular in these places is because of the Islam religion and local cultural traditions, which forbid women from doing abortions. If anything, a western entrepreneur opening a clinic there could be seen as an affront to cultural traditions by many, making the enterprise far riskier. This, of course, not always the case – the example provided by Tarun Khanna speaks to universal values of wanting to receive quality care and to have information about doctors and facilities. What I am saying is that not every opportunity as seen from the eyes of a first-world country foreigner is an opportunity that can be solved by foreign capital.
The lecture was very useful to me, in general, it opened my eyes to how many problems could potentially be turned into business opportunities. However, I am not so naïve as to jump blindly at every imperfection of the world that is out there, seeking to solve it by addressing the institutional needs behind it. There are many risks involved, and many entrepreneurs, including myself, prefer safer, if less opportunistic markets, where rules of the game do not change and the laws actually function. However, I think this approach can be applied even to our own countries and cities. Many things here are far from perfect, and could use an entrepreneurial touch.