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.

World's Ruling Elites Must Power Share

The Long Now and other future prognosticating outfits made the prediction that an end to human suffering would occur in this century. This means an end to starvation, massively preventable disease, poverty and other impediments to basic life fundamentals.

Indeed, this will probably come to pass more quickly than originally expected in this century due to a variety of factors. First and most basically, eradicating third world need is an idea whose time has come. Perhaps somewhat guilt-triggered, it is increasing unacceptable and unpolitically correct for the developing world not to have its basic human needs met. The July 2005 Live8 worldwide concerts exemplifies this reigning attitude.

Second, together with the unacceptability of developing world status quo is the belief that it is possible, even easy, to resolve these issues. Although, as Paul Saffo reminds, we should not mistake a clear view for a short distance, it is increasingly clear that solutions exist and have not been implemented as a matter of choice, partly due to the choices of the ruling elites and geopolitical influences. Amy Chua's "World on Fire" notes that development or indeed any modicum of progress is not in the incentive of ruling elites (in industrialized or developing worlds!) because it erodes their power base.

Third, the simultaneous realization that previous aid programs failed and the implementation of programs with results as a requirement is helping to eradicate poverty and disease. Former World Bank officer William Easterly points out in "The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics," that aid recipient countries were worse off in nearly every dimension twenty years after the formation and deployment of the World Bank and IMF. Unstructured and unmeasured financial aid failed. Newer philanthropic, NGO and non-profit efforts such as the Gates Foundation malaria program and Dr. Paul Farmer's Partners in Health tuberculosis and other programs are generating success with a results-oriented focus and willingness to address the cause rather than the symptom.

But.......the really interesting idea is not that humanity will progress (this is excellent but not the most interesting aspect), the really interesting idea is that world power and influence dynamics must necessarily change when there are suddenly hundreds of millions of people "coming online." Hundreds of millions of developing world people will be becoming independent, capable, educated and healthy and competing in and contributing to the global market. For example, Africa's labor force could quadruple rapidly because malaria is no longer an issue. What is really interesting is how the (current) industrialized world will respond to the increasing weight and influence of the (currently) developing world.

Economist Jeremy Siegel's view is that this will be a fairly smooth transition. The retirees in Europe, Japan and the US will welcome, indeed rely on, developing world purchasers of their stocks, bonds and businesses as they liquidate their assets to retire. Multinational brands, as recent trends suggest, will continue to matriculate to developing world ownership.

However, cultural issues and value systems are very difficult to manage, especially with the perceived diversity that currently exists in this world. There can be hope but not likelihood in the possibility of industrialized nations not seeing the inevitable and hastening decline of Western world rule but rather focusing on the continued higher levels of human achievement that will now be possible, massive innovation and transcendence into the next era of human civilization and advancement.