My ambition

As I did explain in the previous two blogs my basic frustration is that the most important group for development within low-income societies are kind of neglected by developmental aid and conventional financial institutions (although this last group is excused by the fact that they are commercial entities chasing financial return on their investment). I believe that investing in small and medium enterprises backed by a real entrepreneurs, a business builder, is a highly effective, efficient and sustainable way to bring economic development in a low-income country that is superior to tradition developmental aid. Because it is solving the three problems developmental aid is struggling with in a very natural way:
- Ownership: Everybody knows the horrible stories of aid that did not work. In most cases the reason for the failure is that the target group does not feel ownership of the aid product. The good thing of business builders is that they have the drive and ambition to build and to change their own situation. The entrepreneur is moving, an investor is helping to speed up the process.
- Sustainability: The ultimate proof of sustainability for a business is profit and growth. This implies that customers, employees and other stakeholders are satisfied with the products and revenues of the company. Also, the effect of assisting strong entrepreneurs is sustainable because economical feasible businesses are lasting, even after the activities of investors expire.
- Cost effective impact: SME’s in both high and low-income countries are the engine behind the creation of employment. Realizing the best business plans with strong entrepreneurs maximizes impact on the social environment of those businesses. For stakeholders, these enterprises generate the perpetual stream of income needed to uplift their lives in other areas. As a rule of thumb the potential social return on the investment is one direct and 1 indirect employment opportunities per 3000 euro invested.

More financial resources should be available for business builders. According to google.org: “Today, there are trillions of investment dollars chasing returns – and SMEs are a potentially high impact, high return investment. However, only a trickle of this capital currently reaches SMEs in developing countries. Our goal is to increase this flow.” Like them, my person mission, the reason why I am in presently in Uganda, is to increase the investment flow in small and medium enterprises and business builders. I like to contribute in proving its effectiveness in bringing development and making it mainstream. My dream is that investing in medium and small enterprises will be as fashionable as micro-credit is presently.

This requires an effective infrastructure that connects social investors/ developmental aid budgets with good investment opportunities (strong entrepreneurs with strong business plans). This infrastructure is not available in Uganda. To proof the effectiveness of investments in small and medium enterprises in low-income countries I want to build an infrastructure and show that it is working!