InfoDev: Growing Innovation
Supporting New Technologies and Entrepreneurs Through a Network of Specialized Business Support Centers
April 5, 2013
The global connectivity explosion that infoDev championed throughout the last decade has broken new paths to bring high-quality jobs to the marginalized. Accordingly, infoDev has refocused from ICTs to innovation and entrepreneurship support, designing new tools to help start-ups drive growth, tackle development challenges like climate change, and galvanize would-be entrepreneurs.
The private sector provides 9 out of 10 jobs in developing economies and is a leading engine of development. The main thrust of that comes from micro-, small-, and medium-sized enterprises, especially in technology sectors—a recent study argues that 3 jobs are created in a community for every new high-tech job.
However, entrepreneurs in developing countries often face barriers as they shepherd their ideas from mind to market. Notably, new ventures in emerging and frontier markets frequently lack affordable infrastructure, business mentors, training opportunities, access to financing, connections with regional and global marketing channels, and even a favorable innovation ecosystem.
Multiple parties—entrepreneurs, business support centers, investors, technology leaders, regulators, academia, development partners, and others—have developed granular solutions and insights with currency across sectors, countries, and stages of growth. infoDev’s unique grassroots network of business support centers allows the program to crystallize that knowledge, share it, and use it to set up cutting-edge innovation centers across the globe.
In response to the many hurdles faced by entrepreneurs in developing countries, infoDev works to improve competitiveness, employment and sustainable, inclusive growth by helping innovative technology ventures. infoDev serves its clients, donors, partners, and the wider development community by:
- Experimenting and pioneering on-the-ground approaches to supporting growth-oriented entrepreneurs in developing countries.
- Influencing the global innovation and technology entrepreneurship agenda.
- Developing and implementing scalable programs specifically targeted for mobile, climate and agribusiness enterprises.
- Promoting inclusive strategies that benefit marginalized groups, women, people living in extreme poverty, minorities, youth, and others.
infoDev has a number of major projects underway or in the pipeline for FY13-15. infoDev has secured funding from Canadian CIDA, UK’s DfID, the government of Denmark, AUSaid, the Ministry for Foreign Affairs of Finland, and Sweden’s Sida to develop specialized networks of Mobile Applications Laboratories (four), Climate Innovation Centers (seven), Agribusiness Innovation and Entrepreneurship Centers (four), and seed-stage financing facilities across Africa, the Middle East, East and South Asia, Eastern Europe, and the Caribbean.
infoDev’s Mobile Applications Laboratories (mLabs), along with various regional partners in the mobile sector, have piloted an array of minimal-cost ways to spur mobile entrepreneurship, including a global ideation challenge (in partnership with Nokia) and follow-up hackathon, a social media-driven pitch fest spanning the Caribbean islands, and top-visibility international partnerships. infoDev will crystallize the impacts and lessons from its multiple mobile pilots to date in a study coming in 2013.
After two years of stakeholder meetings and assessment studies, the first Climate Innovation Center (CIC) launched in Kenya in September 2012; six more centers are planned as of early 2013. Each is expected to support 70 firms over a five-year period, providing equity financing of $100,000 to $700,000. Priority projects will include renewable energy, water sanitation, micro-hydropower, bio energy, transportation, and solar power. This project also marks an innovative new step for infoDev as an “accelerator,” combining both incubation and financing.
Agribusiness Innovation Centers—currently planned for Ethiopia, Mozambique, Senegal, and Tanzania—will aid smallholders and new ventures to seize on post-harvest agricultural processing. The first AIC is slated to open in 2013.
infoDev also continues its long-term business and government advisory role, providing regulators, policymakers, and capacity builders with objective, authoritative resources such as the Impact Xchange (a network of climate specialists), the ICT in Agriculture Sourcebook, the Broadband Strategies Handbook, and various incubation best-practice studies.
infoDev projects are contributing to achievement of the following results:
- infoDev’s network of approximately 240 business incubators has helped 20,000 enterprises create more than 220,000 jobs worldwide.
- Since FY10, the four infoDev-established Mobile Applications Laboratories (mLabs, launched in FY11-13) and the mobile incubators in the infoDev network have received applications from over 1600 developers and entrepreneurs, brought 117 mobile applications to market, and provided in-depth support to more than 164 businesses. Out of those, 22 businesses have secured investments totaling more than USD 13 million. Out of the entrepreneurs and innovators supported by the mLabs, 16% are women. In the United States and Europe, only 1 to 5% of technology start-ups are woman-led.
- As of October 2012, over 1,300 incubator managers have received training under infoDev's Business Incubation Management Training Program—the first comprehensive training program available for managers of business incubators in developing countries.
- Three months after its launch in September 2012, the Climate Innovation Center in Kenya had mobilized 1,000+ stakeholders in 7 countries. It had identified 140 potential beneficiary firms, and leveraged its initial funding by a factor of 30. With 11 firms receiving support and an additional 24 formal applications in process, the CIC was on track to meet its objectives—creating 4,600 jobs over 5 years, mitigating up to 0.7 M tons of CO2, generating 90 MW of off-grid electricity, and bringing clean water to 110,000 households and better, cheaper food to 42,000 households.
- In FY10-12, infoDev commissioned or completed over 24 knowledge products—including studies on how (and how not) to design agribusiness incubators; on how online tasks can be used for development; on the opportunities for private entities in managing electronic waste; and the role of information and communications technology in post-conflict reconstruction. These resources have been downloaded over 325,000 times.
- As of FY13, infoDev has funded eight “Mobile Social Networking” hubs—in Azerbaijan, Georgia, Kenya, Moldova, Nepal, Tanzania, Uganda, and Vietnam—that organize monthly networking events, talks, workshops on issues related to mobile applications development, and even local chapters of high-profile international initiatives.
- At the Fourth Global Forum in Helsinki, Finland, in May and June 2011, infoDev conducted a business acceleration competition for a group of 50 top SMEs, ultimately awarding 20 with seed funding for internationalization. Of the winners, by late 2012 a Guatemalan producer of affordable water filters had grown to employ 110 people (including 73 women); a Kenyan farming marketplace had grown from 3 to 18 employees and reached 6,000 subscribers; a mobile health application had achieved over 150,000 downloads, and a social advertising service had secured USD 2 million in investment (more than the cost of the entire Global Forum) from leading Silicon Valley venture funds.
infoDev’s Fifth Global Forum, to be held at the end of May 2013 in South Africa, will feature Africa’s most promising entrepreneurial minds through a pitching contest, in order to connect them to potential investors, networks and useful networks.
infoDev works with a number of important partners and donors:
- The Republic of Korea—The Republic of Korea established the $15 million Korean Trust Fund on ICT4D, administered by infoDev on behalf of the Global ICT Department of the World Bank. As of FY13, the Fund has supported 34 projects relating to cutting-edge ICT solutions for development problems.
- The Ministry for Foreign Affairs of Finland—In combination with MFA Finland and Nokia, infoDev has created the Creating Sustainable Businesses in the Knowledge Economy program, which has provided support to a variety of initiatives, including Mobile Applications Laboratories (mLabs), the Global Forum on Innovation and Technology Entrepreneurship, the Central Asian Capacity-Building Initiative and the Open Africa Innovation Summit.
- Canadian International Development Agency—CIDA provided funding to launch the Entrepreneurship Program for Innovation in the Caribbean, a $20 million program over seven years to expand the region’s incubation and financing ecosystem and set up support facilities for mobile developers, clean technology start-ups, and women entrepreneurs.
- UK Department for International Development—DfID provided seed funding to develop business plans for Climate Innovation Centers, or CICs, devoted to technologies that help address climate change mitigation and adaptation. It also provided funding for research on mobile innovation and microwork and the role of ICTs in post-conflict situations.
- Danish International Development Agency—DANIDA provided seed funding for the development of Climate Innovation Centers, and continues to support other projects in the climate sphere.
- Swedish International Development Cooperation Agency—In FY13, Sida provided funds toward infoDev’sMulti-Donor Trust Fund. Its contribution will support new operational and analytical work in the field of mobile applications for the ‘bottom of the pyramid’, inclusive innovation and women’s entrepreneurship in Africa.
- Ministry of Science and Technology of Brazil—Provided funding for a report on e-waste in the country, and a proposed framework for handling its disposal, recycling, and reuse.
- infoDev has also partnered with the World Bank, IFC, Germany, South Africa, Nokia, the Bill and Melinda Gates Foundation, and the Brazilian Association of Science Parks and Business Incubation (Pt), among others, on a variety of initiatives.
infoDev’s decade-long experience in business enabling, access to finance, networks and capacity building, and knowledge management is complemented by its unique position within the World Bank Group. infoDev has the agility to pilot new concepts at the grassroots, and to scale workable solutions into larger projects that support the World Bank Group’s commitment to innovation and entrepreneurship. It also bridges operations and knowledge through best-practice assessments, research, and publications. infoDev supports the growth of a strong private sector in developing countries in a manner that leverages technology and innovation and feeds growth, competitiveness and inclusion.
Over the past few years, infoDev has built on its success in incubating technology-enabled businesses to launch specialized programs aimed at promoting the growth of new ventures in the mobile, climate and agribusiness sectors. These programs provide technology testing facilities, formal or informal mentorship, training courses, and regular multi-stakeholder networking opportunities, as well as traditional business incubation services. Supporting these strategic sectors contributes to growth and competitiveness, and leads to the development of value-adding jobs suited to the new knowledge economy.
In addition to our incubators, labs and innovation centers, infoDev is piloting acceleration approaches designed to allow a new venture with particularly high potential for growth to increase its investability quickly. Through intensive mentoring, re-evaluation of business strategy and sometimes, a reconfiguration of service and product offerings, we can help startups move from idea to prototype in just a few weeks, and go to market in as little as two months.
Example 1: Ecofiltro—a Guatemalan, family-owned manufacturer of low-cost home water filtration systems—first reached international notoriety as a Top-20 SME winner at infoDev’s Fourth Global Forum in 2011. Afterward, CEO Philip Wilson saw his company’s revenues soar to more than $1 million by the end of the year. In 2012 he opened a new plant and hired 110 new employees, including 73 women. The plant shipped 120,000 filters in 2012 and is projected to double that output in 2013.
Example 2: In June 2012, Alexander Shakaryan, an Armenian programmer, claimed the runner-up spot in the m2Work Challenge—a global ideation quest to unleash mobile phones’ potential as platforms for inclusive jobs. His app, MicroForester, allows individuals in developed nations to commission and track small reforestation efforts. After his win, Shakaryan obtained a sponsorship agreement with a local leading food industry company, drew investment interest from mining companies, and signed a Letter of Commitment with the American Institutes for Research for a future USAID-funded reforestation project in Cambodia. “I believe that m2Work was a big success in raising the awareness about the concept of microwork and collecting numerous new and innovative ideas,” he said.
Example 3: Anne Shongwe—a 25-year South African development veteran—came to mLab Southern Africa CEO Derrick Kotze in 2012. Her app Moraba—which combats gender-based violence by spreading awareness—had already been developed with funding from UNWomen and was well received by its target audience of children and teenagers. The challenge then was to “find the sponsorship to expand the game to predominant handsets in the market, develop the distribution ecosystem through third-party distribution, […] and mine the data and analytics that we have built in to the game design.” Shongwe teamed up with Kotze to seek alternative sponsorship, branding, and distribution avenues. In an interview for Al Jazeera, she affirmed her belief that the app could reach 100 million at-risk youth.