The second session of The Power of Social Entrepreneurship series began with an introduction by Melissa Paulsen, Associate Director, Entrepreneurship and Education Programs and Keough School Concurrent Assistant Professor of the Practice, welcoming back the virtual community that formed last week and those that have just joined. She provided a brief recap on last week’s session emphasizing that Social Entrepreneurship is not about creating entities but about bringing a new mindset to social value creation. Paulsen then introduced this week’s topic and crucial question: Can entrepreneurship help to reduce poverty? She also reintroduced the session’s speaker Michael Morris, professor of the practice with the McKenna Center for Human Development and Global Business. Morris has dedicated his career to bringing entrepreneurship empowerment to those operating under issues of adversity. His guest speaker is Rock Andre, Founder and CEO of the Center of Entrepreneurship and Leadership in Haiti (CEDEL Haiti), which is a social enterprise that promotes the development of entrepreneurial spirit in Haitian communities.
Morris explained the format of the session, which will consist of him sharing ideas and getting Andre’s perspective on them. The first topic is how we think about entrepreneurship. Entrepreneurship has the power to empower and transform and this perspective can lead to it being a solution for poverty; a part of the pathway to poverty alleviation. Morris proceeded to explain that poverty is not a characteristic, but a circumstance for people that continues to be a severe problem in our world. He provided an array of concerning statistics in regards to poverty around the globe and drew attention to the costly and ineffective efforts throughout the world, particularly the U.S., to alleviate it. The conversation shifted to the role entrepreneurship can play in making a dent in poverty. Andre proceeded to explain his experience and what led him to entrepreneurship. He explained that after the earthquake in Haiti, he conducted a survey to determine the needs of the people during this time and concluded that 53% of people’s priority was to find a job, even over food, shelter, and basic health services. After this result, he realized entrepreneurship is the tool that will be able to bring change to Haiti.
Morris moved on to explain the multidimensional nature of poverty, it is more than just the lack of money. The challenges of this multidimensional nature can be organized into four key factors in addressing entrepreneurship:
- Literacy Gaps
- Scarcity Mindset
- Intense Non-Business Pressures
- Lack of Safety Net
This is the Liability of Poorness. These are the factors that work against an individual in poverty who is trying to start a venture. Morris delved into each of these factors and provided several examples for each. This Liability of Poorness affects everything, from their opportunity horizon to their ability to access resources. Andre explained that the LOP is the reality in Haiti and that is what they are trying to change, beginning with educating to change the mindset. Doing so allows entrepreneurs to capitalize on what they do have rather than focusing on what they don’t.
Morris advanced to discuss the four types of entrepreneurial ventures: survival, lifestyle, managed growth, and aggressive. The poor disproportionately create survival ventures, which suffer from something called the commodity trap. Andre explained how CEDEL’s mindset training helps entrepreneurs break from this commodity trap by helping them differentiate and come up with a different approach to their venture. Morris then tackled the claim that ventures by poverty entrepreneurs are unproductive and inefficient, when in fact the opposite is true. These ventures play important roles on both the broader economic level, such as serving market niches and stabilizing neighborhoods, and the individual level, by developing the knowledge and skills of the entrepreneur. Morris explained the SPODER model, which are the steps taken to combat poverty through entrepreneurship.
The conversation continued, discussing the issues of expanding the poor’s opportunity horizon which would need the development of a different toolkit, one which would consist of escaping the commodity trap and designing sustainable profit models. The discussion then led to the importance of changing the entrepreneurial ecosystem, which Andre emphasized was not in good shape in Haiti. Andre explained that even though it is important for entrepreneurs to have the right environment to create a business in their country, entrepreneurs must not wait until all the conditions are perfect to start something. He proceeded to explain the importance of their youth entrepreneurship program, and how it invests in the next generation of entrepreneurs.
Morris transitioned to discuss what is being done at Notre Dame, particularly the South Bend Entrepreneurship and Adversity Program, and goes into detail on how the program functions and how it helps the local entrepreneurs. He also shared about the new Notre Dame’s new website portal, Global Partnership for Poverty and Entrepreneurship (GPPE). Andre then delved into his new high school initiative, which exposes young students to entrepreneurship through clubs. Andre finished by describing his challenging experience returning to Haiti after university in hopes of starting CEDEL Haiti and that passion that drove him to continue. The session ended with a Q&A session that consisted of the following questions:
- How do companies help with debt equity? And if people need grant funding, how they get started or how do they overcome that?
- Specifically within the U.S. context or within Haiti’s context, what are things that would help catalyze this entrepreneurial ecosystem?
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