Editor's note: This is the eighth post in a new series highlighting some of the most high-impact and replicable innovations in social entrepreneurship education through the lens of the 2013 Ashoka U – Cordes Innovation Awards winners. This post was written by Carolyn Meyer, director of professional immersive learning and special programs in the Graduate School of International Policy & Management at the Monterey Institute of International Studies.
Who says MBAs can’t change the world? The investment managers with Frontier Market Scouts are ready, willing and able.
At 59, becoming a “scout” for social impact halfway around the world was the last thing on Steve Hoberg’s mind. Having left business school 35 years ago, and more recently having sold his profitable windows manufacturing concern in New Mexico, Hoberg knew he had to make a quantum leap not to repeat the conventional, albeit successful, path he had mapped in building his first career. He opted out of board memberships with nonprofits and foundations, wanting to reinvent himself. Eventually, Hoberg applied for the Frontier Market Scouts program, and became one of the 30 scouts in the FMS class of 2012.
Jointly developed and managed by the Monterey Institute of International Studies (a graduate school of Middlebury College), Sanghata Global and Village Capital, the Frontier Market Scouts program turns compassionate and capable professionals into investment managers in capital-starved regions and sectors of the world. Their mission is to unlock economic opportunity by supporting and scaling the efforts of enterprising individuals in poverty-stricken societies, while gaining career-defining and life-changing experiences at the rich intersection of ideas, people and places between purpose and profit.
Vijaya Pastala was well versed in the nonprofit world. She had been working for a decade with small-acreage farmers in the villages of Maharastra, India. When her business, Under the Mango Tree, which trained farmers to become beekeepers to increase their crop yields and incomes (and sustain her own operations through the sales of honey), was selected by her peers in the Village Capital Accelerator Program for a $75,000 investment, she knew she needed help.
That help came in the form of Ravi Kurani (FMS ’11), an Indian-American with an MBA from the Monterey Institute. Hired by Village Capital right after the FMS training program, Kurani, acting as Under the Mango Tree’s de facto COO, warned Pastala of the looming risk of bankruptcy due to a problematic profit margin in their honey production. Through some business analysis and remix, he helped the business boost its sales by 50 percent and increase direct income to farmers by 20 percent in just a few months.
“The FMS Program is great news for seed-stage investors in the frontier markets,” remarked Ross Baird, executive director of Village Capital. “The scouts fill the huge human capital chasm that has sunk many opportunities to do both well and good.” Village Capital builds on the trust of peer groups of social entrepreneurs to generate impact investment deal flows by replacing traditional, high-cost due diligence methods with peer learning and selection.
Ross saw his scouts’ continued social and economic impact, and the trust they build on the ground, as essential to the global expansion of his organization. Many early-stage impact investors which have placed Frontier Market Scouts agreed, from Invested Development to Shell Foundation’s Access to Energy Program to Agora Partnerships in Latin America to Kinara Capital in India.
The program runs intensive two-week-long training programs in beautiful Monterey in January and June. The small class of scouts is highly sought after by impact investment organizations and their portfolios of social enterprises, which place the scouts in underserved communities for six-month assignments.
Getting a seat in the program has become very competitive ever since it allowed applications from outside the Monterey Institute. The program now attracts students from elite universities as well as junior professionals from top employers such as Goldman Sachs, Deloitte, TD Investment, and Cambridge Associates. Some managers have taken sabbatical leaves, or even resigned, from these firms to take part as scouts in the FMS program.
“Millennials want a purposeful life and profitable career at the same time. Not one or the other. Not one and the other sequentially,” said Yuwei Shi, dean of a Monterey Institute graduate school, who also co-founded the program with Sabiha Malik of Sanghata Global, a U.K. public charity. “Social enterprises in the frontier markets hold the most promising problem set for them to discover, experiment, and invent solutions that may change the world and redefine capitalism as we know it today.”
Having won the 2013 Ashoka – Cordes Innovation Award in Social Entrepreneurship Education for the Frontier Market Scouts program, Shi believes he is well positioned to develop and deliver one of the most rewarding learning and life experiences any higher education institution could offer.
“My FMS experience wasn’t a matter of thinking outside the box,” Steve Hoberg recalled of his time in Bangalore, India, working for Kinara Capital. “It was taking the box and blowing it up.” To him and his wife, Kim, the six-month experience was an eye-opener, delivering an immeasurable personal gain that has become an essential part of who they are. He is involved in a Sanghata Global conservation and community development project in Northern India’s Corbett National Park, well known for its surviving Bengal tigers.
Hoberg has just taken a position as director of finance for a developer of housing for low-income and disabled people in Albuquerque. His reinvention is almost complete.