Ashoka Shows How Biz & Citizen Can Collaborate

Recently, our Chairman & CEO, Bill Drayton, visited the Ashoka team in Bangalore, India. While he was there, Archana Rai of The Economic Times, the largest read financial daily in India, had a chance to catch up with him and chat a bit about the convergence of profit-making and doing social good. While the entire piece isn't available online yet (we're working on it!), we thought we'd give you a taste of their conversation with this excerpt.

"What is the structure of business and society that will evolve out of a convergence of profit and social good?

The hybrid value chain that brings together for-profit business and the citizen sector is the most important structural shift since the agricultural revolution. To understand it fully, you need to step back in history. From the time of the Roman Empire to the 1700s per capita income grew by just 20%. Then, in the 1800s, it grew by 200% and in the next century by 740% as the scale of business grew rapidly creating wealth for a few of the worlds population. Also, governments which could tax the new wealth created by business became huge. But the citizens in half of the world remained unproductive. But since the 1980s, this disparity is reducing as the citizen sector begins to catch up with business. Across the world, people want change in bureaucratic forms of government and business wants to move beyond serving just 6% of the world's population.

What is the role for entrepreneurship in such a scenario?

Business has been able to address only a small portion of the worlds population, this is the market failure. Changing this imbalance is the next big entrepreneurial opportunity. Ashoka is demonstrating the way business and the citizen sector can collaborate.
In India, we have done this with affordable housing, where 10,000 housing units will be set up with $120m of private funding. Entrepreneurs such as Vishnu (Vishnu Swaminathan, Director, Housing for All) are showing how it can be systematised; how such a hybrid system can work independent of government. For instance, there is a need for 26 million affordable housing units and this will require trillions of dollars. Business makes money and informal sector gets houses.
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They go on to talk about other such topics as models of financing that will emerge as a result of such collaborative entrepreneurship, examples from the for-profit sector, and what this all means for government policy.

It's an interesting conversation, and we'll let you know when the rest is posted. In the meantime, let us know what you think about this emerging trend on Twitter (you can find us @AshokaTweets and be sure to use #collabent in your tweet)!

This article was originally published on January 18, 2011
Related TopicsBusiness & Social Enterprise

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