Economic Growth

How entrepreneurship boosts inclusive growth

Linda Rottenberg
Co-Founder and Chief Executive Officer, Endeavor
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It was an unusual place to be inspired. In the back of a taxi, winding through Buenos Aires, a seemingly innocuous conversation sparked a two decade mission. I still hesitate to call the man up front a driver. He had a PhD in engineering, driving because there was no other option. “Why not start a business?” I asked, seeing in him potential that he may not have seen in himself. He quickly dismissed the idea; he wasn’t a big businessman—empresario in Spanish—so how could he start a company?

Seventeen years later, Endeavor has spread to 22 countries, leading a global movement to give more  than 1,000 entrepreneurs the confidence to answer that question—why not start a business?—with another—how big can its impact be? In societies where entrepreneurship used to be the domain of either the extremely poor—micro-entrepreneurs—or the very wealthy—the empresarios, Endeavor is building an inclusive middle path, making high-impact entrepreneurship the foundation of prosperous societies worldwide.

Some of Endeavor’s most inspiring entrepreneurs are also those whose successes, in another era, would have seemed most unlikely. They are people who, without the confidence to start and scale a business, might have remained outsiders. Instead, today they are more than founders of world-class businesses; they are the catalysts of a movement to democratize entrepreneurship and to make sure that its rising tide lifts millions into the middle class.

The beauty queen

Take Leila Velez. She grew up in the slums of Rio de Janeiro, her mother a maid, her father a janitor. Without the inspiration to start a business, she might still be serving hamburgers at her local McDonalds. Instead, she saw an opportunity that had long been ignored: beauty products designed for the curly locks of Afro-Brazilian women like her. What started in a 300 square foot salon 20 years ago has since become Beleza Natural, an $80 million business employing 2,300 people and proving to her more than 100,000 monthly customers that “poor people deserve to feel beautiful, too.”

More than Starbucks

Like Leila, Lateefa Alwaalan is something of an outsider. She studied for an MBA in Seattle, but returned home to Saudi Arabia to start a business of her own. In a country with few women entrepreneurs, Lateefa built Yatooq, a fast growing company that manufactures and sells the Nespresso of Arabic coffee. Her company is more than just an affirmation that some of the best entrepreneurs come from unexpected places. It is also producing a product that empowers millions of women throughout the Gulf Region, women who now spend just a few minutes making coffee that had previously taken more than a half hour to prepare.

Impact means inclusion

Inclusive entrepreneurship is more than just a handful of interesting stories; it is a powerful way to create more equitable societies. Recent research shows that the employees of high-impact entrepreneurs are not only more satisfied, but also have better access to healthcare and education for their children. These entrepreneurs are also more likely to become mentors or investors, giving rise to future generations of entrepreneurs. Lateefa, for example, has started CellA, a professional women’s network in Saudi Arabia, while Beleza Natural hires its staff from the lower-income communities it serves.

Young entrepreneurs and employees who are influenced by top-performing entrepreneurs like Lateefa and Leila are, in turn, more than twice as likely to become top-performers themselves. We’ve already seen these dynamics at play in New York City, where an inclusive attitude has led to an explosion of women tech entrepreneurs, from just 42 in 2003 to 457 in 2013, with successful entrepreneurs like Arianna Huffington of the Huffington Post, Alexandra Wilkis Wilson of Gilt Groupe, and Heidi Messer of LinkShare influencing dozens of younger entrepreneurs.

Breaking barriers

High-impact entrepreneurs like Leila and Lateefa are beginning to break down the barriers that once separated those with access to their society’s advantages from those without. They are initiating a new era of trickle-up economics, in which high-impact entrepreneurs drive societal change, pushing big business and government to be more innovative, responsive, and inclusive, to the benefit of people formerly on the margins of society.

These high-impact businesses are about more than beauty treatments or pots of coffee. They are about unique CEOs who become role models, and about women, minorities, and the global poor who have access to products designed specifically for them. They are about employees with access to healthcare, and their children who will attend good schools.The high-impact entrepreneurship movement that started with a cab ride is now being realized around the world, creating opportunities for both founders and employees that would have been inconceivable twenty years ago. There is much to be done still, but the entrepreneurs who carry the torch are already leaving the world a more prosperous, inclusive place.

Author: Linda Rottenberg, Co-founder and CEO of Endeavor

Image: Nuno Carvalho, 34, CEO of The Portuguese Bakery, clears tables on a terrace at one of its outlets in Lisbon December 21, 2012. REUTERS/Rafael Marchante

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