1) @lajump, aka Leslie, rightly pointed out that the private sector has an important role too.  While the government is key to reducing red tape and facilitating start-ups, the Egyptian private sector must help by opening up its networks and taking risks on promising enterprises. “I am ready to put more money in,” Egyptian billionaire and telecom titan Naguib Sawiris told Businessweek.  Recognizing that it was the source of pain, he believes in “spreading” the country’s prosperity.  That will be key in order to protect his own.

2) Celebrate the ones that are there, but make sure that everyone knows about it.  Everyone wants to guide an entrepreneur and tell him or her how to do it.  What about telling the rest of us how he or she did it?  We in the West do it through publications such as Fast Company, Inc. Entrepreneur and entire newspaper sections devoted to the topic.  The same is not true in the developing world.  As a development and media junkie, I’m dismayed by the absence of entrepreneurship coverage in places like Egypt.  The stories of the incredible Egyptian men and women that have launched enterprises have the power others to believe in their ideas.  Perhaps that will inspire them to become entrepreneurs.  Better yet, perhaps it will inspire them to become writers, architects, designers and anthropologists (see earlier post).  Reading about someone turning an idea into reality builds confidence.

Journalism training is a must anywhere, anytime.  In this post-Mubarak era it an opportunity to equip Egypt’s talented reporters with the skills to report on entrepreneurs and entrepreneurship.  Reuters, the Soros Foundation and the European Center for Journalism are organizations doing just that. The fourth estate made all the difference in the French Revolution.  Let’s make sure it does the same in the Egyptian one.

• A year ago, Egypt’s government released figures on the country’s poverty.  It showed that it had reached 23.4 percent, “up from 20 percent the previous year.”
• In June 2010, the United Nations Development Program (UNDP) released its Human Development Report for Egypt.  That report noted that among the country’s unemployed, estimated to be 8 million, “90 percent were under the age of 30.”
• Business Insider has this informative piece about Egypt’s “economic tragedy”, in what it calls “3 simple charts.”

In a special report in 2010, The Economist ran this set of social indicators:

Egypt is more populous and poorer today than it was 20 years ago.  But it is also more literate and connected to the world.  That is good and bad.  Young Egyptians are developing skills and becoming more aware of the opportunities around the world – (and the lack of them in their own country).  You extrapolate.

Increased freedoms would go far to ensure that these youth can access those opportunities.  Expanding entrepreneurship would guarantee it.  As much as Egyptians need and deserve freedom, they need and deserve the tools that will allow them to build vibrant and sustainable businesses.

Endeavor is one of the few non-profits working to do that.  It is working to support “high-impact” entrepreneurs through world-class mentorship and high-level networks.  They are entrepreneurs such as Hind and Nadia Wassef who run Diwan, a boutique bookshop committed to reviving Egypt’s rich literary heritage, Mostafa Hafez, a young techie who creates video games at Timeline Interactive, the company he founded with the belief that Silicon Valley isn’t the only place where innovation comes from and Fatma Ghaly, who as the CEO of Azza Fahmy jewelry, has created a highly-coveted Egyptian designer brand.  These entrepreneurs are shattering perceptions that entrepreneurship in Egypt can’t succeed.

Last year, following the April 2010 Presidential Summit on Entrepreneurship, the State Department launched the Global Entrepreneurship Program (GEP).  ”Focused on supporting and empowering entrepreneurs,” GEP is another program helping Egyptians realize their entrepreneurial potential.  It’s one of the few government programs that doesn’t make me cringe.  That’s because, rather than doling out funds or ideology, it is tapping into its platform to identify entrepreneurs and connect them to mentors and networks in order to help start-ups thrive.  From the looks of the crowds in Tahrir Square, thrive is something Egyptians are hungry to do.

Earlier this week the White House and the Kauffman Foundation announced Startup America Partnership, an initiative aimed to allow Americans to test “new ideas, bring new products to market and generate new businesses.”  Isn’t there a way to replicate and adapt this for Egypt?

Hat tip to @krmaher and @auerswald who have enriched, through their smart and measured Tweets, my experience of the events in Egypt.

Smell

It brought tears to my eyes.  As soon as the astringent yet sugary scent that wafted through the Marriott Karachi hit my nose, my stomach tightened: someone was cooking onions.

I hate onions.  There’s no real explanation for it.  I just do.  And that’s a very big problem for me wherever I go.  The powerful bulb, worshiped by the ancient Egyptians, is the key ingredient in just about every dish everywhere.  That has made ordering in a restaurant tiresome – for both my fellow diners and me.  “Please, no onions,” has become my predictably Pavlovian platitude.  That was no exception in Pakistan.

One cannot escape the scent of onions in the south Asian country.  It, far more than curry, is the basis of Pakistan’s rich and meat-heavy cuisine.  That is why Nishan Channa, a 25-year old MBA student at Karachi’s Institute of Business Administration (IBA), has launched an onion business.

“I’m sorry that you don’t like onions,” Channa said to me as we sat on the maroon, beige and navy striped couches of the Marriott Karachi.  “But you can generate lots of things from onions,” he said with a smile, earnestly trying to convince me to change my mind.

Channa is attempting to generate a business that utilizes “100 percent” of an onion’s resources, producing “zero wastage.”  His idea: first, sell fried onions, a staple in Pakistani kitchens, to local restaurants and hotels.  He’s already started with Karachi’s popular BBQ Tonite, an Olive Garden-esque eatery.  Then, use the peels as biomass fuel to produce electricity and whatever waste that is leftover as cattle feed.

It’s an idea that many others outside of Pakistan have already run with.  That Channa is, in present-day Pakistan, fascinated me.  Agriculture is no longer the country’s main economic driver.  Following the global trend, Pakistan has largely become a service-based economy.  Given nearly 60 percent of the population is illiterate, that strikes me as a problem – perhaps the cause of Pakistan’s problems… But I’ll leave the economists to analyze that.  I’m more interested by Channa’s interest, not in gadgets or, (forgive the cliché), guns, but in onions – and using them to solve the country’s severe energy and economic crisis (see previous posts).

In today’s uber-connected-Social Network-reality TV-obsessed world, young minds are eager, more than ever, to claim their 15 minutes.  Ideas seem to be born not for utility but out of vanity, or worse yet, anger. Channa’s desire to be Pakistan’s Mr. Onion is a welcome contrast to that.  It is a clear signal that practical, perhaps even old-fashioned, solutions to solve Pakistan’s problems exist.  And they do so at the hands of Pakistanis themselves.

Sound

Pakistan hums with machinery.  It is a powerful hum that, in certain instances, drowns out all other sounds.  One barely notices the cacophony of Pakistani families who travel in packs, or hears the ‘Allahu akabar’ of the azan, the Islamic call to prayer, or even the jingles of the brightly colored and elaborately adorned trucks and buses whose hoods are decorated with a belly dancer’s jangled hip scarf.

This potent hum, however, is no white noise.  It is the reverberation of back-up power generators that are found in most Pakistani businesses, hotels, offices and homes.  With persistent outages that can last up to 15 hours daily, self-powered generators are the only viable option, for those who can afford it.  I counted five outages sitting in my five-star hotel one night.  Yes, Pakistan has an energy crisis.

Pakistan’s government has not adequately responded to this crisis.  Rather than repairing outdated power plants that lack capacity production or resorting to alternative and less expensive sources than oil and gas, it has called for a reduction in supply, decreed that “marriage halls will no longer be able to host all-night wedding parties,” and has banned neon signs and brightly-lit billboards.  To be fair, Pakistan is afflicted with a host of other plagues including insurgent violence, unemployment, inflation, corruption, weak governance, and crumbling infrastructure, made worse by this past summer’s devastating floods.

AP photo

Still, without solving the key matter of energy, the country has little prospect of economic progress or defeating the insurgency.  “The shortages have crippled industry and led to rioting across Pakistan,” a BBC report says. Energy: Pakistan’s Catch-22.

Pakistani officials blame tax evaders for the problem.  “Why should Pakistanis pay their taxes,” one citizen told me, “when they have to pay out of their own pocket for the basic services the government cannot deliver?”

While energy is ultimately a government’s responsibility to provide, it needn’t be government’s burden to produce.  There are entrepreneurs that have ideas for solving Pakistan’s energy crisis.  Wasae Shaikh, a scrappy and scrawny 25 year old I met at Karachi’s Institute for Business Administration, is one such person.  Shaikh, a second-year MBA candidate, wants to set up model villages that produce solar and wind energy.  National Geographic sparked his idea.

“I watched this episode about wind farms in Amsterdam,” the trim bearded Shaikh said to me as we stood underneath a large tree in the institute’s courtyard.  He thought, “We’ve got wind here in Pakistan.  The sun too.  We can launch an alternative energy business using solar panels and biomass fuels,” he said pausing to look at me.  “I want Pakistan to be self-reliant. We have to give it a try for our people.  I want to do it for my people.”

Wasae Shakikh's Talentrepreneur shirt caught our attention on IBA's campus

“For my people,” was a refrain I kept hearing from Pakistan’s youth and its entrepreneurs.  Their country may not have enough energy, but they do.  And they’re using theirs to pull Pakistan out of its political and economic abyss.  Young and bright Pakistani entrepreneurs, who have the option to leave, are staying behind to launch businesses, in such fields as textiles and technology, to help their country.  Wasae Shaikh is one example.  In the coming days and weeks I will give you others.  Through their efforts, Pakistan, I believe, will continue to hum, not to the machinery of generators, but the machinery of this generation.

Sight

“Welcome honored donors,” read the banner hanging over the passport control counter at Benazir Bhutto Airport in Islamabad.  That, along with hot, musty air, was my greeting to Pakistan, at 3AM two Sundays ago.  I had arrived, along with my colleagues Phil Auerswald and Sara Shroff to assess Pakistan’s entrepreneurial landscape.

Not far from the banner, there also hung a framed black and white photo of a gaunt man in a dark textured and triangular hat, similar to the one that Afghan President Hamid Karzai sports.  It was Muhammad Ali Jinnah, the revered founder of Pakistan – the land of the pure.  Jinnah established the republic in 1947, after gaining independence from the British and breaking from India.

Jinnah reappeared a half hour later when I entered the lobby of the infamous Marriott Islamabad.  He was there again the next day when we visited the Institute of Business Administration in Karachi.  Jinnah seemed to be everywhere.  The only other place I know of where that happens is… Turkey.  The image of Mustafa Kemal Ataturk, the blue-eyed founder of Turkey, is, like Jinnah’s, ubiquitous throughout Anatolia. Both dominate every government office, school entranceway and public space.

Pakistan and Turkey have a lot in common.  As predominately Muslim nations, both have struggled with secularism and Islam.  Both have had, as a result, numerous military interventions that have overthrown their respective country’s government.  As predominately agrarian societies, Pakistan and Turkey have wrestled with developing their respective economies in order to compete on the global marketplace.  For a long time, it was a tough fight.  Both countries choked under unemployment, debt, run away inflation and rent seekers.  Pakistan still does.  Turkey has broken from that cycle.

It broke as a result of the economic liberalization reforms enacted by late Prime Minister Turgut Ozal in the 1980s.  With less state-control and relaxed trade and banking laws, Turks embraced entrepreneurship.  Overnight, they turned Anatolian cities, more commonly known as “Anatolian tigers,” into textile and manufacturing centers and lifted Turkey’s poor into the middle and upper class.  Today, Turkey holds a seat at the G20 and the UN Security Council.  Despite being continually rejected by Brussels, it has, by the European Commission’s own account, the fastest (and perhaps only) growing economy.  It is an example that beleaguered Pakistan can and should replicate.  It should do so with Turkey’s guidance.

One of Islamabad's main roads

Turkey understands Pakistan’s economic struggles because Turkey once endured them as well. “We have common problems and common solutions,” said Turkish Prime Minister Recep Tayyip Erdogan while visiting Pakistan just last week.  Part of Turkey’s solution is taken directly from Washington in the form of aid.  *Sigh.*  Fortunately, the other part of Turkey’s solution is precisely what Pakistan will help Pakistan develop: investments.

Rather than a money problem, Pakistan suffers from an investment problem.  The money that Pakistanis possess is caged. It’s used to cover day-to-day expenses rather than being used as leverage to create new enterprises and, most importantly, jobs.  Turkey has discussed opening banks in Pakistan, increasing trade and encouraging its private sector to seek collaboration on construction, infrastructure, engineering, energy, agriculture, telecom and textile opportunities.  That is a good start.  But more can be done.  Here are two suggestions:

• From a historical, religious and cultural perspective, Turkish entrepreneurs and investors are ideal role models and mentors for aspiring Pakistanis with start-up ideas.  They can help advise on operating in a Muslim society where entrepreneurship has not traditionally been encouraged or possible, where risk has largely been absent and where failure has always been the kiss of death.  Both countries could develop an entrepreneurship exchange and mentoring program where Pakistani entrepreneurs spend time working in Turkey and Turkish entrepreneurs in Pakistan.

• Turkish investors could establish, along with their Pakistani counterparts, a fund, with manageable interest rates and transaction fees, for Pakistani entrepreneurs.  It is an idea that American venture capitalists would benefit joining as well.  This will help unshackle Pakistan’s paralyzed capital that can then provide the leverage to jumpstart enterprise development and job creation.

It is imperative that Pakistan climb out of its current crisis and into prosperity.  There are signs it is prepared to do so.  The absence of Jinnah’s photo in the sleek and modern offices of the several entrepreneurs Phil, Sara and I met with was the clearest.  Pakistan’s younger generation, while deeply patriotic, is not straightjacketed by the past.  They know that while Jinnah may have been their country’s founder, they are its keepers.  For now, they’re pushing their black and white past aside in order to keep their focus on what could be Pakistan’s abundantly colorful and high-definition future.

Read more: http://www.portfolio.com/views/blogs/entrepreneurship/2010/09/23/clinton-global-initiative-discussion-focuses-on-poor-as-a-market

The “maximum” city, as one writer has dubbed it, *teems* with poverty.  Tin siding, blue tarpaulin and decaying wood dot every vantage point, from posh five star hotels to busy roadsides.  Restless barefoot children swarm stopped cars and tourists to beg for a Chicklet or a rupee.  Homeless men defecate on the street.  Mumbai’s poverty is raw and consuming.  I found it hard to handle.  No surprise then, I turned down an offer to visit Dharavi, the Slumdog Millionaire ghetto, for a “slum tour.”

With all the excitement surrounding poverty alleviation efforts, including microfinance and social entrepreneurship, slum tours have exploded in popularity. This troubles many, including Kenyan native and Echoing Green fellow Kennedy Odede who recently wrote about his aversion in the New York Times.

“Slum tourism turns poverty into entertainment, something that can be momentarily experienced and then escaped from.”

I’m not so sure.

I skipped the Dharavi tour because I couldn’t see how a “slum” was any different than the poverty spread throughout Mumbai.  In doing so, I also missed an opportunity, as writer Anand Giridharadas told me, to see promise.  (His The ‘Slumdog’ effect: Afflict the comfortable a must read).  Slum tours take visitors to see life, not desperation.  Yes, life.  Isolated from the markets and services available to mainstream society, many entrepreneurial slum dwellers are bring much needed products and services to their communities.  Poverty is a condition of being without resources and opportunity – not without talent and dignity.

For decades, Westerners only saw the poor through heart-wrenching images of fly-infested children with bloated bellies.  Traveling to the third world amid an East-West divide, civil wars and dictatorial regimes made it impossible for us to actually see or know these children.  And that made it impossible to know or understand their plight.  All we could do was believe that their lives were – not just worse than ours – but blighted.  Hence we helped – out of guilt, not conviction.  We opened our purses and wrote checks.  Then when our regularly scheduled programming resumed we complained that nothing ever changed with “those people.”  They were never real to us.

Today slum tours give depth and humanity to “those people.” These tours show how “those people” are changing their communities – and how we can help them.  Contrary to what Odede believes, it moves some to not only start a dialogue and conversation, but also to mentor and invest in these innovators – just ask the Acumen Fund and Vision Spring.

To be fair, Odede’s concern that slum tours are voyeuristic is valid.  No doubt there are those for whom it is a selfish exercise, a “look at me, I saved the world” pat on the back.  It is improbable, however, that anyone with an ounce of decency could be “entertained” by it.  He is also right that slums won’t go away because of these tours alone.   Yet, they most certainly won’t go away if we stay out of them.

In a globalized world where the gap between rich and poor is only growing larger; where we are self segregating into communities and networks based on similar values and beliefs, slum tours provide a platform to connect and turn poverty away from being a concept into a reality.  In doing so, they also show us that the poor are not helpless.  More importantly, they show the poor that they are not alone.

“Please tell them our story,” a Turkish villager in southeastern Anatolia told me on a visit three years ago.  “Tell them we are poor but not impoverished.  Tell them we are just like you.”  Indeed they are – go see for yourself.

Israelis believe so.  “The IHH..is widely considered a terrorist organization by a number of bodies – including the Israeli government,” wrote Jerusalem Post’s Ben Hartman.  “Israeli authorities say IHH bolsters Hamas…It also charges that the group has links to al-Qaeda…”said the New York Times.

IHH officials deny this.  “IHH’s aims are humanitarian, not political,” said Omer Faruk Korkmaz, an IHH board member.  “We are Muslims that is all.”  And that is precisely what is raising eyebrows.

IHH was formed in 1992 during the Balkan wars to provide aid to Bosnian Muslims. It has since grown to become a multi-million dollar charity supporting Muslims in over 120 countries around the world.  Much of this support goes to orphan care, educational programming, including the building and repair of schools, and food aid programs.  It has several thousands of volunteers and supporters outside of Turkey, as demonstrated by the various nationalities aboard the Mavi Marmara.

“IHH’s funding is drawn from a broad base of middle-class donors,” Korkmaz told the Financial Times.  The middle class has become a significant economic and political force in Turkey, as the country’s ruling Justice and Development (AKP) party will tell you.

The AKP’s rise to power in the late 1990s came at the hands of a growing class of entrepreneurs from the Anatolian heartland.  These entrepreneurs, pious and traditional, made millions, with which they pursued policies that reflected their devout views.  Breaking the illegal blockade of Gaza is a recent example.

As the United States and leaders from other countries, including Israel, encourage young men and women, particularly in Muslim majority countries, to take up entrepreneurship as a means of lifting themselves of poverty and out of the grips of figures such as Hezbollah leader Nasrallah they should consider similar outcomes.

Just as in Turkey, the rise of a Muslim middle class will inevitably result in more and more philanthropic support for Muslim-based causes.  Not all these causes will be extremist or violent.  They will be, however, causes that, as the Mavi Marmara demonstrated, at times, will challenge Western policies – and might outright oppose them.  Does that make them wrong?