Through an innovative approach to funding small business
ventures, youth from around the world have come together to fight
poverty and unemployment.
Nearly 50 per cent of the world’s population is under the age of 25.
It is this young generation, and those that follow, that will need to
rise to the occasion if the world’s most critical problems are to be
solved. As problems go, there is perhaps none more pressing than global
unemployment and poverty, manifested in a growing inequality. If we are
to alleviate these struggles, we must facilitate entrepreneurship to
create jobs for this younger generation.In the summer of 2010, I visited Kenya to interview members of the different communities that had taken part in the 2007-08 post-election violence. What struck me most from this experience was the impact that poverty and unemployment had on these people. It was the poor, predominantly, who had fought. Some had been paid by elites to fight. Most had been fighting for a better and more prosperous life.Related:But it wasn’t just the direct relationship between poverty and violence that was so troubling. It was the much deeper effects of the impoverishment – the anger and disappointment of the current population and the fear that limited opportunities would be available to future generations.
That said, I remember being equally inspired by the productive endeavours that many young Kenyans were pursuing. A surprising result of the widespread unemployment in Kenya is the entrepreneurial nature of the younger generations. Because no jobs are available, everyone is forced to sell things (second-hand clothes, mobile-phone top-up cards, tourist merchandise, etc.) – this is the only way to survive. Talking to many of these young men and women, I was excited by their ambitious plans to create new businesses.
However, Kenyans are consistently denied the opportunity to achieve these ambitions and start new businesses because of a lack of access to capital. As a matter of policy, banks and microfinance institutions won’t lend to start-up businesses without collateral or a proven revenue stream. So the poor are trapped.
I left Kenya with a strong belief that a key to solving Kenya’s unemployment problem is the implementation of strategies aimed at supporting young people who are seeking to start new businesses.
This is where the idea for Balloon Kenya
emerged. At Balloon Kenya, we train young people from around the world,
giving them the skills to work with Kenyans in solidarity as they
develop, test, and create new businesses. Working with groups in Kenya,
we provide support for young entrepreneurs throughout the entire
business journey – encouraging youth to believe they can run their own
businesses, providing support and guidance as they design those
businesses, helping them get funding, and then mentoring them, enabling
them to repay their loans. Within this model, Balloon Kenya does two things that are particularly valuable. First, we work with young people who would not normally be able to access funding. We put trust in the same young people that banks turn away. Our funding model allows us to take more risks and offer low interest rates without demanding any collateral in return. International participants pay for this unique mentoring opportunity, and we use this money to invest in Kenyan businesses. Each time a new international cohort works in Kenya, the pot grows, allowing us to invest more. We know that some businesses will fail and loans won’t be repaid, but we accept and account for this as part of our model.
Second, we strongly support the idea of bringing together young people from different backgrounds and traditions and encouraging them to work side by side, because we believe that innovation and creativity can be spurred by such collaborative efforts. For instance, one youth group we worked with mentioned that many people were having trouble finding love in Kenya’s new urban environments. When a young person from the U.K. mentioned the success of internet dating agencies in England, the group suddenly had an exciting new business idea. Those young people have since launched Nakuru’s first dating agency, throwing singles events and providing matchmaking services. Another group came to Balloon Kenya because there was no garbage collection in its town. The youth initially didn’t see this as a business opportunity, but we empowered them to design a refuse-collection service that sells organic waste to farmers as manure and pig feed. In December 2011, they received a licence from the municipality to begin operating, and now their business provides jobs to unskilled workers, helps farmers produce more food, and improves the local environment.
As these examples show, entrepreneurship not only provides jobs and income, but also has the capacity to target other pressing social ills. In recent times, this has been increasingly forgotten as business has become unbalanced in pursuit of profit. By encouraging, funding, and supporting young Kenyans to solve problems that matter to their communities, Balloon Kenya is not only providing jobs, but is also improving community well-being for the longer term, enabling the establishment of businesses rather than offering one-time or sporadic provisions of aid.
Around the world, people are seeking a new way of doing things, searching for a new model of capitalism that reduces the growing gap between rich and poor. Whatever you call it – the triple bottom line, moral capitalism, social enterprise – Balloon Kenya hopes to empower young people to pursue a model of economic development that values people and planet alongside profits.
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