Sunday, May 11, 2008

Future of entrepreneurialism

The traditional definition of entrepreneurship is expanding to include more creative ways of approaching business, applying business disciplines to social problems and establishing a wider range of success metrics. Four key trends are coming together to facilitate this new era of entrepreneurship: a shift in social consciousness, the democratization of capital, innovative responses to traditional financial systems and the low cost of starting a startup in the globalized world.

Shift in social consciousness
There is a great attitude shift underway towards sustainability and social responsibility. Al Gore, Paul Hawken and others have helped to put global warming, carbon neutrality, poverty and equity firmly on the international agenda. Part of the new social consciousness is also about effectiveness and accountability. Cycling the bottom of the pyramid out of poverty requires getting target populations actively involved. Loans are better than aid.

Democratization of capital
The ability to have more granular attribute knowledge about all economic transactions has triggered the demand to direct capital and consumption based on these affinity attributes. People are willing to pay on average 5-10% more for their attribute choices, for fair-trade, organic and local items, for hybrid cars and for blended value or double/triple bottom line financial returns.

Innovations to the traditional financial system
The shortcomings of traditional financial systems, their hierarchical nature, the lack of universal access and cyclic failures like the current mortgage crisis are triggering innovative solutions such as…

  • Microfinance and P2P finance (for example, Kiva is currently active in 40 countries and lending about $750,000 per week)
  • Socially Responsible Investing and social capital markets including social venture capital as offered by GoodCap
  • Timebanks, gift economies and other non-monetary currency solutions
  • Alternative payment mechanisms like developing country cell phone networks as money transfer systems
Low cost of starting a startup in the globalized world
The increasingly low cost of starting a startup makes a whole new tier of businesses possible: the LAMP software bundle provides free technology infrastructure, APIs replace business development and blogs and community interaction replace marketing (social networks become an overlay, a property of every website) and virtual world interactions replace face-to-face meetings.


David Geertz said...

Great post Melanie. I like this concept of's something that I am trying to integrate into our startup but until now have never had a defining word for the action. "TIMEBANK"!

LaBlogga said...

Hi David,

Thanks for your comment. There is some more information about timebanks at and if you search on timebanks in general.

re: your interest in innovative film finance, you may be aware of P2P film funding site, A Swarm of Angels.

Also being in Vancouver, you might be interested in meeting a colleague of mine, Johann Gevers, another futurist with interests in economics, finance and innovative business models.

Roomy Naqvy said...

Melanie, I found you by searching or rather surfing through some women's blogs. Well, you are a senior blogger. I'm quite a kid--I began blogging this year. You were the first thorough professional, and a rather impressive one, whom I saw in the blogosphere.

After the encomiums, I guess I should also tell you that I found your blog and your posts quite interesting and informative. The basic problem that most people have is to find good finance and financing through personal loans and credit cards are bad and lousy alternatives. They aren't going to help you in launching an enterprise.

So, I never did launch an enterprise. I also realized reading your posts and following up on them that it would have been a great help if I were born in the US or lived there. I realize that a number of internet finance (read: lending/borrowing) websites are only for US residents. I know this is to ensure some sort of protection... but that doesn't really mean that everyone in all the other countries of the world is a fraud or a swindler.

LaBlogga said...

Hi Roomy, thanks for the comments, I appreciate it.

You may be aware of, a peer-to-peer lending site aimed at entrepreneurs in India and other emerging economies?

Also, there may already be local peer-to-peer lending sites in India, or the possibility of setting up such a business?

As another route to funding for entrepreneurs, there are Venture Capital firms in New Delhi, both Indian and foreign.

Good luck!