There are few things more powerful than the feeling of self-confidence and worth that comes from having a steady source of income. Working hard and achieving goals not only helps boost individuals emotionally, but a positive change in one place can have a rippling effect throughout a community.
This is even more true in developing nations. Countries like India have a population that suffers economically. Whether it's the lack of access to traditional banking or the difficulty in gaining access to clean water (21% of communicable diseases in India are related to unsafe water). We need to find ways to support the expansion of businesses with greater educational, financial and infrastructure access.
1. Start-Ups Amp Employment and Provide Post-Education Transition
It's impossible to say how many people are impacted positively by the average start-up. Start-ups range in scope and scale; compare a start-up app development company to a new automaker. Huge difference in the number of people that need to be hired. But, what we do know is that a percentage of start-ups are successful and as a result of that success they hire people.
Providing jobs to the community, improving standards of living and creating something of value to the end-consumer are natural bi-products of the start-ups third-world nations need. For recent high school and college graduates, a start-up can represent an incredible opportunity to gain the industry experience necessary to eventually work for a larger company.
2. The Challenges Start-Ups Face
Start-ups involve incredible risk. All of the blood, sweat and tears could result in a total loss. Business-minded people hate donating their time and energy; they crave a return. So, to create a climate where start-ups can thrive, we need to work on providing the following to developing countries.
Infrastructure: If you can't get your products to the intended consumer, then how can you sell them something? In many countries the cost of delivering goods or services to a customer completely precludes the market. For example, India's transportation "...sector has not been able to keep pace with rising demand and is proving to be a drag on the economy." (Source: World Bank)
Access to Start-Up Capital: In emerging markets, we've seen that capital allocation can be a real challenge; especially in more rural sections of the population where access to reliable information to determine creditworthiness can be problematic.
Even if credit reports can be ascertained, many individuals lack basic financial literacy. Their credit profile precludes them from accessing traditional financial support to launch a business. The one bright spot in a bleak lending market for disadvantaged populations is the rise of peer-to-peer lending.
This form of lending empowers borrowers to access capital from individual funding sources around the world. Usually this is something that's accessed online, once a company is properly registered. Thankfully, setting up a limited company or LLP is a very simple process. You complete an application form and filing fee, submit it for approval and start trading as soon as you like.
Personal Liability: While the legal formation of a business is critical to creating a legal shield to protect risk-taking entrepreneurs and shareholders, many individuals living in rural areas and have no access to legal assistance. Setting up a business is a self-guided process for these individuals. Making the process as user-friendly and accessible as possible is key.
For example, in most developed countries, entrepreneurs are able to establish a trademark, register a business and provide regular updates to quarterly and annual reports online. This kind of access allows for innovation to occur at the speed of a mouse click.
3. Unleashing the Entrepreneurial Spirit
When cities and regions come together to support entrepreneurial pursuits, everybody benefits. For example, Chicago has begun holding an annual celebration of small business and the grit showcased by startups in virtually every industry. According to DAC, "Grubhub food delivery, on-demand dry cleaning service DryV (like Uber for laundry), parking spotter app SpotHero, residential leasing startup StreamLease, and real time nightlife app SceneTap are just a few of the cool ideas that have come to fruition in the last four years." These advancements in service and product offerings to the city are the result of a city-wide effort to increase support to start-ups and the dreamers who are willing to take a chance on the futre.
If we want to wake up tomorrow to a better world, we need to remove the barriers to business creation that exist today. Creating a successful business and earning a stable income helps build communities up, and gives individuals a sense of pride. We need a world where everyone feels bought-in. If we can help people, even in the poorest of regions, feel like they have the opportunity to grab destiny for themselves, the world will be a far more stable and productive place.