Commentary

Peter Burgess

Interview with Ben Powell, Founder and Managing Partner of Agora Partnerships

Recently, I interviewed Ben Powell, Founder and Managing Partner of Agora Partnerships, a global community committed to unleashing the power of entrepreneurs in the developing world to use business as force for positive change. Ben is also the Director of the Agora Venture Fund, a development venture capital fund that invests in early stage ventures in Nicaragua.

Ben has an MBA from Columbia, an MSFS with distinction from Georgetown, and a BA with high honors from Haverford College. Ben is a Draper Richards Fellow and an Ashoka Fellow, and was named one of the top 40 under 40 development leaders in Washington DC in 2010.

Rahim Kanani: Describe a little bit about the founding and motivation behind Agora Partnerships.

Ben Powell: Back in 1998, I started a miniature golf business in Mexico, and it changed my outlook on the world. One of our employees, a single mother, was able to get a loan to buy a small apartment, all because she had a job in the formal economy where she could establish a credit history. I soon realized I was having more of an impact on the world with the golf course, at least in a way that was meaningful to me, than at my day job at the White House budget office.

I had always been interested in international development, and came to believe that the single best way to fight extreme poverty in very poor countries was to help entrepreneurs. Amazingly, very little development assistance actually focused on helping entrepreneurs. Microfinance at the time was getting a lot of press, but that approach to development wasn’t focused on entrepreneurs with big dreams so much as the self-employed. I saw an opportunity to create a new kind of entrepreneurial non-profit organization to bring people together to solve social problems through business.

I quit my job and went to Columbia Business School and worked with about 20 students to write a business plan and provide pro bono consulting to entrepreneurs in Nicaragua. Later, I learned about a whole movement to support a more sustainable kind of company that is motivated not only by increasing shareholder value, but by actively contributing to a better society. We exist to help entrepreneurs who share these values; they are going to be key to the future of liberal democracy and capitalism at a time when both are being questioned across the globe.

Rahim Kanani: What does “Human Potential + Capital = Impact” mean?

Ben Powell: This is the equation that guides our work. Human potential means focusing our efforts on people with the vision, leadership and execution ability to make a positive difference in their communities. Capital is the fuel that unleashes potential. And there are three important kinds of capital all entrepreneurs need. First, growth capital from private investment — this is key and there is very little of it in the developing world for early-stage businesses. Second, social capital — trusted networks, and a community of peers. Third, human capital — mentors and help with finding the right employees. When you bring capital to entrepreneurs who can use it to attack social problems like job creation for very poor people it creates tremendous impact at very little cost to the public.

We look at impact in terms of social value generation (jobs, products or services that make lives better, economic growth, power of role models) and environmental impact (low carbon footprint, taking into account future generations in business decisions.) You can also measure the impact, like seeing revenue growth or more products reaching a needy population, like the 500,000 families in Guatemala that have no access to electricity.

A company called Quetsol is solving this problem, using investment not charity, but like any company it needs investors willing to back it. When investors back a company like Quetsol they are not only hoping to make a return, they are hoping to change the lives of tens of thousands of people. That’s the essence of a form of investing that is now being called impact investing.

Rahim Kanani: How would you describe the key challenges to development in Central America?

Ben Powell: Central America is a very diverse region and each country has particular challenges and opportunities. One of the biggest challenges I see – and this is a problem across the developing world — is the extreme difficulty for even the best entrepreneurs to access the networks and investors they need to grow. There is virtually no early stage financing so if you have an innovative idea that requires upfront capital, it’s tough to find the right investors. Even if you do find capital, there are challenges finding great management talent and in general too many would-be entrepreneurs are on the sidelines, too afraid to take risks or with too limited views of what they could actually accomplish.

The good news is the region has a lot going for it from natural resources to free trade with the U.S. Most importantly, there is great human capital in the region and in the diaspora – incredible entrepreneurs who have bold visions for how to build businesses that solve key problems facing the region; our job is to find them, bring them together and give them the tools to get the different kinds of capital they need to grow.

We are working with other like-minded organizations to help build a culture where the best entrepreneurs have the opportunity and encouragement to innovate and to shake up the status quo. As we start to have more success stories from the region, this culture will only grow.

Rahim Kanani: What is an Agora Entrepreneur?

Ben Powell: Agora Entrepreneurs are what we call the entrepreneurs who are accepted into our Accelerator program. They operate early stage businesses in very poor communities in Central America – and soon Mexico and typically have 3 – 40 employees when selected.

An Agora Entrepreneur is different from other entrepreneurs in three respects. First, they have gone through a rigorous selection process to determine if they have the leadership potential to build a profitable business that can also solve key problems facing humanity, like extreme poverty, or access to housing or energy. We only select a small group, usually about 10-15 a year. Second, they have a viable business plan. Third, they create and measure social impact, not just shareholder return. Business and society are no longer two separate spheres of activity, they are merging, and in this respect Agora Entrepreneurs represent the future of business and the future of the international development industry.

Rahim Kanani: If the work of Agora Partnerships rests upon one core philosophy about the way in which the world works, what is that philosophy?

Ben Powell: People with optimism and purpose are the world’s most important resource. We need to cultivate such people and then invest in them. This investment can be through our money, or our networks, or our experience. It’s about bringing people together, whether investors, volunteer MBA consultants, fellows, mentors – it’s about focusing our desire to make a difference in the world in the way that makes the most difference – helping entrepreneurs on the front lines of development to solve humanity’s toughest challenges.

Rahim Kanani is a writer, advocate, strategist, and entrepreneur for global social change. Currently, Rahim is a consultant at the World Bank Institute, holding a joint appointment with the innovation practice and communications team. Rahim is also an official contributor to Forbes.com, where he writes a leadership column titled the Common Good, which covers all things social change, with a special emphasis on social entrepreneurship.

He also regularly writes for the Huffington Post, and has been published in a number of other national and international publications including the Ottawa Citizen, San Francisco Chronicle, International Herald Tribune/New York Times, Stanford Social Innovation Review, MIT Sloan Management Review, BBC World Service, and Al Arabiya.

As part of his writing, Rahim frequently interviews global leaders in great depth on issues of urgent international concern, such as with former British Prime Minister Tony Blair on interfaith dialogue, White House Senior Advisor and Assistant to the President Valerie Jarrett on gender equality and the advancement of women, President of Harvard University Drew Faust on higher-education in the 21st century, and Human Rights Watch Executive Director Kenneth Roth on the future of human rights philanthropy and policy.

The author is a Forbes contributor. The opinions expressed are those of the writer.