Brazil faces many challenges such as poverty, income inequality, and social unbalance. Some entrepreneurs in the country are dedicated to address these issues and promote better lives for fellow Brazilians. You will meet some of them in a series of stories published on BayBrazil. In the first article of the series, meet leading organizations and understand the impact of social entrepreneurs transforming low income communities around the world.
Suelen Vale, BayBrazil reporter
Broad social inequality, low rates of high education, precarious housing conditions, poor access to preventive care, low social mobility, and high rates of teenage births are some examples of problems faced especially by developing countries, and Brazil is in this group. However, these same issues are motivation for thousands of entrepreneurs who work for the development of businesses’ ideas that are aligned with the concept of social entrepreneurship, which are enterprises able to impact society on a wide scale.
Leading social entrepreneurs are individuals with innovative solutions to social problems and their goal is to create a positive impact, reduce poverty, promote economic inclusion, and guarantee that human rights are met. According to the Director of Global Diaspora and Expansion at Ashoka, Maria Clara Pinheiro, there are many successful cases in the social entrepreneurial sector showing these entrepreneurs have great strength and capability to make the change.
“Muhammad Yunus, founder of the Grameen Bank, is a social entrepreneur who developed and spread microcredit globally; he also pioneered the concept of social business ventures such as Grameen Telecom, which has enabled rural village women to become profitable sellers of telecommunications service in their communities.”
Ashoka is a global organization that invests on leading social entrepreneurs, in different ways. The organization provides a stipend to those who need financial support, for 3 years, to allow them to commit full-time to their ideas, in addition to access to Ashoka’s network. The organization connects these social entrepreneurs with other changemakers, mentors, partners that will support them according to the stage of their ideas.
“This network is the value of the Ashoka Fellowship. Some of the entrepreneurs are in the early stages and need mentorship; others need support/connections to scale up their models regionally or globally. The Ashoka Support Network is a network of business entrepreneurs, consultants, lawyers, who support the Ashoka Fellows in this different stages of their lives”, explains the Brazilian Maria Clara Pinheiro.
A study launched this year by the anti-poverty organization OXFAM shows that from 2009 to 2014 the wealthiest 1% increased their possessions from 44% to 48% of the world’s wealth while 80% of the population currently own just 5.5%.
The Human Development Index (HDI) measures the level of life expectancy, education, and income indices in a country. Brazil has a HDI of 0.744, which is considered high, but the number puts the biggest country in Latin America in the 79th position in a list of 187 countries. The United States figure in 5th on the list with a HDI of 0.914.
There are many ways social entrepreneurs can empower communities to fight and overcome limitations such as income inequality and low literacy. The Center for Digital Inclusion (CDI), started in Brazil in 1995, works with low income communities to empower them to change their lives through the use of technology. The organization has currently more than 840 educational centers in 15 countries and has trained 1.4 million people in 20 years of existence.
Educational centers set up in economically vulnerable communities work through the franchise model established by CDI, which identifies the best partners in the communities who have credibility with the locals. These leaders are trained to become educators and the project is followed by CDI. All courses offered in these centers – from Microsoft Office to development of apps – are taught through the CDI’s methodology of social problem-solving. The Center for Digital Inclusion is present in low-income communities, prisons, psychiatric institutions and care for people with physical disabilities, indigenous villages, and public schools.
CDI School is the initiative started in partnership with education departments and companies to bring technology to the classroom in attractive ways, through the development of applications and coding. Rodrigo Baggio, Founder and Executive Director of CDI, explains that the organization’s goal is not just to present the technology itself, but encourage students to identify problems in their communities that could be solved through an app, for example.
“When you teach kids to code, they understand that they are capable to reprogram their own lives,”says Rodrigo Baggio.
CDI’s project with public schools has expanded to other countries than Brazil. Apps for Good is the name of CDI’s program adapted to schools in England, Ireland, Scotland, Spain, and Eastern European countries. Baggio says he wants to implement it in the United States as well.
“Five years ago we were invited to adapt our work for schools in England. It has been amazing. We teach kids to develop apps for smartphones that has a positive impact on society”, explains Baggio.
In Apps for Good, teachers and students work together using CDI’s methodology to detect problems in their community, think in a solution, and execute the project using technology. After finishing their apps, children from all England go to London to compete in a children’s version of a business pitch competition.
“The Apps for Good Award is incredible, kids get training to pitch their work and they even receive mentorship. Imagine two 12 year old friends pitching their social business plan of a social media created to combat bullying at school. That is amazing.”
The direction of CDI for the development of social businesses is not by chance. The organization has undergone transformations over the 20 years of existence. In 1995, when it was created in order to recycle computers and offer the technology to low income communities in Rio de Janeiro, the digital landscape in Brazil was completely different from now; the internet had just begun to be commercially released in the country and very few people had access to it.
In the last decade, the lan-houses — shops where the clientele could access the internet paying hourly — exploded in the country as people were interested in accessing the internet but did not have this luxury at home. CDI then helped over six thousand lan-houses improve their businesses and operate as social enterprises in a time when these establishments were being marginalized by policy making, according to Baggio.
“CDI Lan was our first social business in a wide scale vision. At the time, politicians were proposing bills that forbade lan-houses close to schools. We worked to insert the lan-houses in the public policy and to reframe their role in Brazil, through a code of conduct, training, mapping, and diversification of businesses in a way that added value to the local population”, Rodrigo Baggio explains.
Now that Brazilians can access the internet from the palm of their hands through mobile devices, lan-houses lost power and relevance. CDI lan has become CDI Ventures, a social enterprise that offers consulting on social entrepreneurship, having partnerships with companies in search to create strategies of social responsibility. CDI’s revenue generation comes from this social enterprise and also through donations. According to Rodrigo Baggio, the idea is to create more social businesses to become independent from the traditional fundraising that NGO’s usually do. CDI has about 100 employees in all countries it operates and 1,100 teachers, in the educational centers, who are paid by the community organizations.
This year, CDI partnered with the Bill & Melinda Gates Foundation to reinvent 50 public libraries in Brazil, bringing innovative solutions to these spaces through technology.
“We need to reprogram the system which we live in. Therefore, social entrepreneurship, bringing the vision that everyone is a change maker, is very powerful. It is necessary to influence societies, schools, universities, and businesses to the transformation”, says Rodrigo Baggio.
Mobilizing governments and policy making is the best way social enterprises can create impact on a large scale, according to the CO-CEO of NESST, Loic Comolli. The company provides financial support and training to social entrepreneurs in Latin America and Central and Eastern Europe.
“I am not saying that social entrepreneurship is small. Not at all. But when you merge social entrepreneurship with policy making, getting a bigger scale, to me that is the best of the two worlds.”
Comolli believes that there are four ways that social entrepreneurship can impact societies. The first one is the direct change on the lives of low-income people who are helped through social enterprises. Secondly, the influence on policy making, once the social entrepreneurs pressure government institutions to change and implement laws that foster more opportunities for social enterprises to tackle the issues. Another way is how social entrepreneurship has affected and inspired financial institutions to launch impact investment initiatives. The fourth one is educating people regarding their consumption habits and their perception about the role of businesses in communities.
The Director of Global Expansion at Ashoka, Maria Clara Pinheiro, says that “making the world a better place” requires everybody’s participation; social, business, and public sectors. She explains that many Ashoka Fellows partner with the private sector and government to scale up their solutions.
These alliances across sectors highlight the importance of connections when it comes to social entrepreneurship. Maria Clara Pinheiro says that in order to succeed in a world that is constantly changing, people need to develop skills of empathy, leadership, teamwork, and problem solving, which Ashoka calls “changemaking skills”.
“Ashoka believes these skills can be taught, but most importantly, they need to be practiced. So we are now creating networks of schools (Changemaker Schools) and universities (Changemaker Campuses) that are committed to support children and young people in learning and practicing these skills.”
In Brazil, NESST has invested in a social enterprise from Recife called Bio Fair Trade, which works with artisans, helping them understand the market, create high quality products, and sell their art to national and international clients.
“This enterprise works with a network of artisans across the country, most of them women and low income. NESST has developed a new business plan with them so they can expand its activities across Brazil and internationally. Right now they are starting to sell to Europe,” explains Comolli.
NESST invests from $25,000 to $100,000 in social enterprises through grants and soft loans, to help them validate their business model and then scale. The company also provides mentorship, with teams in seven countries working closely with entrepreneurs.
“We assist them with everything, from marketing to sales. We put a performance management system in place to track various financial and social impact indicators, so the entrepreneurs are running their businesses based on performance. Forty six percent of the social enterprises in our portfolio become profitable in less than 24 months. This is a good number, considering these are early-stage social enterprises,” concludes Loic Comolli.
