Randall Kempner

Social Entrepreneurship Takes Off in Brazil

Editor’s Note: This post originally appeared in the Stanford Social Innovation Review.

Ten years ago, I set foot in Sao Paulo for the first time. I remember being amazed by the people, the economic potential, and the insane traffic from Guarulhos International Airport. I’m just back from a trip to Sao Paulo, and two of the three things haven’t changed. The ride in from the airport still takes forever (I had to wait an hour just to get a taxi). The people are still incredibly optimistic and creative, even in the face of economic and social hardship. But instead of just economic potential, today Brazilian entrepreneurs are leveraging their deep intellectual, social, and natural resources to drive greater prosperity and create wealth.

The overall Brazilian economy, led by the agricultural, manufacturing, and mining sectors, is booming. Over the past ten years, Brazil has averaged 3.2 percent annual GDP growth. Last year, the country enjoyed an impressive 7.5 percent growth rate. The benefits of economic growth are being felt throughout the country. From 2001 to 2009, poverty rates dropped from 35.2 percent of the total population to 21.4 percent. Yet, that still leaves more than 40 million Brazilians living below the poverty line.

Brazilian entrepreneurs are emerging to address the needs of this marginalized population. Throughout the country, entrepreneurs are exploring market-based solutions to poverty challenges, including access to affordable housing, health care services, and information technology.

On my trip, I met some of those entrepreneurs at BASE, the first Inter-American Development Bank (IDB) Forum on the Base of the Pyramid in Latin America and the Caribbean (see NextBillion coverage here and here). The conference tagline was “bringing market-based solutions to Latin America and the Caribbean to promote social change.” More than 500 high-level participants from all over the world and representing a wide range of sectors flocked to the conference. Over two days, we shared insights from experiences in other countries, met local social investors, and engaged with government and policymakers.

Despite flight delays, two U.S. State Department officials managed to make their launch announcement of a new investment innovation hub. Designed to catalyze the creation of innovative business solutions that align positive financial gain with societal and environmental impact, this hub will be based in Brazil to leverage private sector participation from local firms and multinational corporations.

The IDB and the State Department chose their venue well. Brazilian social investing and social entrepreneurship are quente (or, hot)!

For the past few years, leading Brazilian-based organizations including Artemisia Social Business, the Avina Foundation, Potencia Ventures (formerly known as Artemisia International), and Vox Capital have been cultivating social or inclusive business models.

Since the fall of 2010, these organizations, along with a half a dozen others, have joined together to operate a regional chapter of the organization I direct, the Aspen Network of Development Entrepreneurs (ANDE). In typical Brazilian entrepreneurial fashion, they dove in headfirst. First, on their own accord, they raised funds from local supporters to contract a full-time coordinator. In January 2011, the chapter launched the Brazil edition of NextBillion.net, NextBillion Brasil, which has already published almost 100 articles and attracted more than 11,000 unique visitors. It has run several working meetings for members to come together and discuss ways to strengthen the pipeline. And, it has developed a comprehensive mapping of the social and inclusive business space in Brazil, the results of which will be released shortly.

The ANDE chapter in Brazil continues to be at the vanguard of this growing field, identifying entrepreneurs that can serve as role models, experimenting with new approaches to support the growth of their businesses; creating knowledge (based on practical experience and exchange of ideas); and sharing results, opportunities, and challenges in order to attract even more qualified people that can drive the next stage of growth.

The first time I went to Brazil, I was working with a U.S.-based start-up whose goal was to leverage web-based software to help small entrepreneurial businesses succeed in emerging markets. Our software business didn’t quite make it. This time around, with ANDE, our goals are similar, but the prospects are much brighter.

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Social Enterprise
poverty alleviation, social enterprise