Three Market-Based Solutions To Pull People Out Of Poverty

Using capitalism instead of just giving aid was the focus of the latest eBay/Ashoka contest. Here are the most interesting and exciting winners.

Traditional charity and philanthropy has given way in recent years to organizations like Kiva and MicroPlace that aim to help disadvantaged populations by providing them with economic opportunity, and then letting the people help themselves. This week, the eBay Foundation and Ashoka Changemakers announced the winners of the Powering Economic Opportunity: Create A World That Works Competition—a challenge that asked entrants to offer up "the world's most innovative market-based solutions that create economic opportunity and generate employment for disadvantaged populations." Below, we look at three of our favorite winners, all of whom will receive $50,000.

The Financially Self-Sufficient School Model

This entry, submitted by Fundacion Paraguaya, is a new model of technical and vocational education which "transforms the sons and daughters of chronically poor farmers into financially successful 'rural entrepreneurs' and its scaling up in 50 countries and/or 50 schools by 2017." The Financially Self-Sufficient School model, already in operation at a school in Paraguay, teaches traditional high school subjects and allows students to run small-scale, on-campus agricultural enterprises, such as rural hotels and organic gardens. These on-campus enterprises cover many of the costs of running the school, which already generates $300,000 a year from the program. Now the foundation wants to scale up worldwide.

Nonprofit Innovation through Pay-for-Performance Funding

Submitted by Twin Cities RISE!, this organization's mission is to train unemployed and under-employed men from communities of color with skills that can then be marketed to employers—and can score the unemployed jobs that pay at least $20,000 each year. TCR has formed a partnership with the state of Minnesota where the state pays the organization $9,000 each time the program places a graduate into a $20,000-a-year job, and it pays another $9,000 if the employee stays in the job for a year. The reason: TCR has demonstrated that an employed graduate has $31,000 of Net Present Value to taxpayers.

Mobile Microfranchising in Indonesia

The Grameen Foundation's project is to offer a mobile marketplace, job search services, financial services, health and agriculture information, and small business mentoring to Indonesia's poorest residents. Here's how it works: An aspiring entrepreneur buys a pre-packaged kit, which contains a mobile phone and a microfinance loan. The entrepreneur then sells airtime minutes to neighbors. The opportunity allows the entrepreneurs (usually women) to double their income and gain valuable business skills. Grameen hopes to expand its network of over 7,500 entrepreneurs to 60,000 in the next three years.

[Image: Ashoka Changemakers]

Reach Ariel Schwartz via Twitter or email.

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1 Comments

  • Dr. Fatih Mehmet Gul

    Congrats to Ebay Foundation an Ashoka.. 
    Today's technology and new business models have great potential to help poor people. Mobile money transfer for rural areas, microfinance collection with pos machines, online market for villager poors to sell items, etc. Those projects can be launched with very low budgets, however we need innovative ideas and models. 
    We at ALJCI (www.aljci.org) would be always happy to hear new ideas...