Helping impoverished small business owners, one microloan at a time

Northeastern?s Social Enterprise Institute has been changing the lives of impoverished people in South Africa and the Dominican Republic for the last several years. Photo courtesy of the Social Enterprise Institute.

Stu?dents led by Dennis Shaugh?nessy, exec?u?tive pro?fessor of entre?pre?neur?ship and inno?va?tion in Northeastern?s Col?lege of Busi?ness Admin?is?tra?tion, have been changing the lives of impov?er?ished people in South Africa and the Dominican Republic for the last sev?eral?years.

Just don?t call it?charity.

?We go into poor com?mu?ni?ties and instead of giving charity or aid, we help them improve their lives through entre?pre?neur?ship,? Shaugh?nessy explained. ?What we do is dif?ferent: Instead of telling people how to change their lives, we invest in?them.?

This year marks the fifth year that Northeastern?s Social Enter?prise Insti?tute, which runs the five-??week summer field pro?grams, has been working in South Africa and the fourth in which it has been working in the Dominican Republic. Stu?dents from across the uni?ver?sity pre?pare for the expe?ri?en?tial learning oppor?tu?nity with months of rig?orous aca?d?emic work, learning the the?o?ret?ical basis for micro?fi?nance and small-??scale entre?pre?neur?ship before tran?si?tioning into the?field.

The Social Enter?prise Insti?tute, Shaugh?nessy said, is com?mitted to building the next gen?er?a?tion of busi?ness leaders, both here and in devel?oping coun?tries, through real-??world pro?grams that con?nect stu?dents to poor people who want an oppor?tu?nity to change their?lives.

?You can talk about theory, but you don?t fully under?stand the field until you?re there, expe?ri?encing it in real life,? said Rebecca Willet, a senior inter?na?tional affairs and anthro?pology com?bined major who trav?eled to the Dominican Republic ear?lier this summer with Shaughnessy?s program.

In the Dominican Republic, stu?dents use a micro?fi?nance model to help poor farmers ? who in some com?mu?ni?ties live with an unem?ploy?ment rate of nearly 100 per?cent ? rise from poverty. In South Africa, the insti?tute pairs with a non?profit orga?ni?za?tion and the Ter?tiary School in Busi?ness Admin?is?tra?tion, a non?profit busi?ness school that helps South Africans who lack access to oppor?tu?nity. The goal of the stu?dents? work there, Shaugh?nessy, said, is to help entre?pre?neurs build their own busi?nesses, with some get?ting cash grants to help them?grow.

Over the summer, 45 North?eastern under?grad?u?ates and 35 TSiBA stu?dents worked together over an inten?sive two-??week span, pro?viding con?sulting ser?vices to these microen?tre?pre?neurs. Stu?dents helped the impov?er?ished busi?ness owners design web?sites, develop accounting sys?tems and create busi?ness?plans.

Entre?pre?neurs were selected based on their com?pa?nies? poten?tial to create des?per?ately needed jobs in their communities.

?In my co-??ops at the EU Par?lia?ment, the White House and the MacArthur Foun?da?tion, I learned about social impact investing and entre?pre?neur?ship, but I had never really under?stood what it meant on the microlevel,? said Laura Mueller-??Soppart, a senior eco?nomics and polit?ical sci?ence com?bined major. ?But working on the ground with a microen?tre?pre?neur?ship, you see how this is lit?er?ally changing lives.?

This July, Mueller-??Soppart was paired with a South African wid?ower who had run a boarding house and shuttle ser?vice prior to his wife?s death. He strug?gled to main?tain the busi?ness after his wife passed away, and Mueller-??Soppart helped him restruc?ture his busi?ness and create a mar?keting?plan.

?Before we had even left, he had already gained a new year?long tenant,? Mueller-??Soppart?said.

The ven?tures in South Africa were all rel?a?tively small, but they have the poten?tial to res?onate on a much larger level. One man, for example, devel?oped a system that uses worms to cheaply gen?erate fer?til?izer in a country where arid ter?rain makes it oth?er?wise dif?fi?cult to sup?port agri?cul?ture. The con?ti?nent, more?over, does not have a single fer?til?izer plant, meaning the supply is usu?ally pro?hib?i?tively expensive.

Stu?dents working in the Dominican Republic also spent a week in Cuba, where they devel?oped cre?ative solu?tions for aspiring entrepreneurs.

Shaugh?nessy said the goal of the pro?gram is broader than helping indi?vid?uals escape from poverty. By helping foster new busi?nesses, he believes the Social Enter?prise Insti?tute can lift entire com?mu?ni?ties toward prosperity.

?We see fam?i?lies without food, com?mu?ni?ties where chil?dren die from mal?nu?tri?tion at enor?mous rates,? he said. ?Fos?tering an entre?pre?neur can change the life of more than just one?person.?

Source: http://www.northeastern.edu/news/2012/08/social-enterprise-institute/

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