Several months ago I found a interesting story at CNN.com about how an American inventor of solor powered bulbs was attempting to both help build third world economies, via building village based businesses, and also change how social aid is handled / viewed world wide. Full post here.
The two most interesting quotes in this story follow –
First, Katsaros had to answer a key question that would determine how he would have the strongest impact: should his company be nonprofit, or for-profit?
Katsaros found inspiration from the 2008 book by Paul Polak, “Out of Poverty.”
Polak, who has worked in developing nations for 30 years, believes that the charity model of aid used by nonprofit organizations doesn’t work — despite its good intentions.
The best way to help people, according to Polak, is to treat them as consumers. If you can sell to them, he says, you can help them.
“In the beginning I was a nut case and nobody paid attention,” Polak says. “The consensus was 30 years ago that this is what caused poverty, and to be involved in business was outrageous and evil.”
Today, that is starting to change, he says. But that doesn’t mean that nongovernmental organizations have rolled out the red carpet for Polak’s ideas.
“Many NGOs say it’s making money on the back of the poor, but I love to make money on the back of the poor,” Polak says.
“You can feel really good about yourself giving stuff away … but if you are going to sell things to people, you need to have respect for them because no one is going to buy something if you have contempt for them.”
“If you have a village that’s used to the dole, it’s very hard to get them off of the dole,” Polak says. “We have to face the fact that conventional development aid has failed.
“It just doesn’t work.”
