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Using capitalism to enact social change

A screen shot from the documentary "The New Recruits"

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Seth Kramer

TEXT OF INTERVIEW

Kai Ryssdal: The idea behind social entrepreneurship is to do good through capitalism. Create a business to accomplish some worthwhile goal. Feed the hungry, maybe. Or sanitize a slum. The Acumen Fund out of New York City calls itself a nonprofit venture fund directing financing to those worthwhile goals. Acumen runs a fellowship program, too. Teaching young capitalists how to create and sell goods or services in developing countries -- meeting the needs of the needy, if you will.

A new documentary called "The New Recruits" follows three of those fellows during their year abroad. Seth Kramer helped produce and direct. Heidi Krauel was one of those new recruits. She went to New Delhi to sell solar-powered lanterns. It's good to have you both here.

SETH KRAMER: Yeah, great to be on with you.

HEIDI KRAUEL: Great to be here.

Ryssdal: Heidi, when you discovered, or you were told I suppose that you were going to New Delhi, you went back and you told your parents, "Listen, I just got out of this great business school, and I'm moving to India." What did they say?

KRAUEL: You know my dad was a Vietnam War vet. And he had been in the army reserves for 30 years. He took foreign service really seriously. And he just wanted me to be aware of the risks, the challenges, to take that awareness and sensitivity with me when I went to a place like India, which does have challenging areas. It has big cities, but it also has tribal belts, and deep rural areas where the rule of law doesn't always apply.

Ryssdal: Seth, what was it about the stores that you followed in the movie that made them so attractive?

KRAMER: We wanted to see if we could represent this program well, and really get sort of the diversity of the participants. So we ended up choosing three of the fellows. There's a guy named Suraj who is from India, and he finds himself in the middle of Kenya working for a company that's trying to build pay-per-use toilets in the slums, where you have a million-and-a-half people that are living without sanitation systems. Then you have a guy named Joel. He is a bonafide member of the religious right from Tuscaloosa, Ala., who finds himself in, of all places, Pakistan trying to help this company that's selling drip irrigation systems to poor farmers who have no idea about this new technology. And then there's Heidi. She's a Stanford business-school graduate. A tall, blonde, Californian, who finds herself in a string of remote Indian villages trying to sell solar-powered lights to people who don't have electricity.

Ryssdal: There's a moment when you're in that village, or maybe it's actually when you're in the offices a bit earlier, talking about this trip, but in a voice over you say, "I spend an amazing amount of my time here not being understood." Explain that.

KRAUEL: Just from a pure language perspective, that connection wasn't always there. I didn't speak Hindi. And I don't speak Merati. So just communicating was challenging. And also the perspective I had, the ways I had been trained and had experience in building businesses and establishing partnerships, the same rules didn't always apply. And so I think trying to find ways to understand intentions, form connections, and form partnerships, proved pretty challenging.

Ryssdal: Was there a moment where you discovered how to make the rules apply? Or did you sort of figure a way to make the rules work for you?

KRAUEL: I think it's pretty much impossible to bend India to your way. So figuring how you can be creative to mold yourself to fit in is usually a better tactic.

Ryssdal: Seth, when you first came up with this project, where did you think it was going to lead?

KRAMER: When we first started developing the project, the idea of charging poor people for essential goods and services, seemed like it just would absolutely not work. I wanted to know who thought this was a good idea, and if it does work, I really want to see it. And I didn't think it could work, because I really didn't understand what it means to be poor. I'm not going to speak for the four-billion people on the planet that live on less than $4 a day, but the people that we encountered wanted to have the same choices that consumers have in the Western world.

Ryssdal: And you, Heidi, what did you learn?

KRAUEL: The message of how important it is to listen to the voice of customers in solving the issues of the poor. The poor want to have the tools and opportunities to solve problems for themselves. Traditional aid treats the poor as passive recipients. Using markets, using entrepreneurship and business gives the poor a voice into the products they have available to them, and that's the voice I don't think business really can afford to ignore any longer.

Ryssdal: On the topic of what you guys did during the film, isn't there a limit to this? Doesn't there come a point where you've done all you can do?

KRAUEL: There's so much to be done. There are 500-million people in India that don't have access to power. DeeLight Design will impact 10-million lives in 2010. But one solution is not going to be enough.

Ryssdal: The film is called "The New Recruits." Seth Kramer is the director. Heidi Krauel is, I guess you might say, one of the featured players. Thanks you guys.

KRAMER: It was a pleasure.

KRAUEL: Thanks so much.

RYSSDAL: "The New Recruits" is expected to air on PBS sometime next year.

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Shyloh J.'s picture
Shyloh J. - Feb 23, 2011

Thank you for this article! It is thanks to to expert project procurement management that feats like this are possible! And it's thanks to people like you who run these projects that so many unfortunate people get the things that they need. http://www.mypurchasingagent.com

Casey Quinlan's picture
Casey Quinlan - Dec 3, 2009

Great idea - how about taking it in a slightly different direction, and partnering the recruits with Kiva-funded entrepreneurs? That would put some real rubber on the road to both help get micro-enterprise off the ground in an area - more teach-to-fish than buy-this-fish.

Julie Kelly's picture
Julie Kelly - Dec 3, 2009

Why is purity of motivation more important than outcome? Do the poor also share these priorities? Perhaps more will be accomplished through a pragmatic approach.

penelope fish's picture
penelope fish - Dec 2, 2009

The point that feels morally awkward about this movement is the idea that it's ok for someone who has never known thirst to make a profit from those dying for want of it. There's the complete lack of understanding of the other culture, and the idea that it's fair to profit from those who have so little that the lack endangers their existence. It would seem the business person is entitled to a share from someone regardless of how little they have, to an absolute degree.

KRAUEL talks about the "voice" that markets give to the poor, stubbornly missing the fact that Money IS the Voice In A Market. Those Without Don't Have A Voice.

I guess if you call it business, regular morality doesn't apply anymore.
Nor common sense. Who goes to a country to "help" others while knowing NOTHING of the language or culture?

I'm curious to see this film and wonder if the "entrepreneurs" ever saw the arrogance of trying to help a people they had no understanding of. Better than fixing others, this would at least be improving ones' self.

S.J. Phred's picture
S.J. Phred - Dec 1, 2009

So, the capitalists didn't know what it was like to be poor, didn't speak the language...in other words, did not understand the customer, and therefore may not have known the needs of the customer. But they did understand the product they wanted sell to make money.

Does this model sound familiar in American business experience? And what happens to the business, when the customer no longer wants the product because they want what they need instead?

Bryce Franklin's picture
Bryce Franklin - Nov 30, 2009

See the quotes from an article in Europe Energy, from 2002, which said that 580 million people in India were without electricity. URL: http://goliath.ecnext.com/coms2/gi_0199-983402/MORE-THAN-1-6-BILLION.html

Adrian Collins's picture
Adrian Collins - Nov 30, 2009

I find it odd that Kramer referenced Krauel as a tall blond when her photo clearly shows her roots, but that too is off topic (clearly his point of the stark visual contrasts was understood.) What I found profoundly engaging about this piece is the mention of pay toilets, and my mind going to a place of some archived file where solid waste matter can be used to generate electricity; for these cities that need it...

sreekar chada's picture
sreekar chada - Nov 30, 2009

I applaud the worthy and noble business cause. However, Heidi should find the facts first. There are a billion people in India and according to the comment on your interview, 500 million have no elecricity. 50% of population has no electricity? I cannot believe that as that many people already live in or near cities. Probably numbers are based on facts from 40 years back which are not relevant today. This will definitely misguide future generation of social entrepreneurs.
Thanks,

Sreekar

Mark Henderson's picture
Mark Henderson - Nov 30, 2009

Great story. I can't wait to see the film. I am teaching social entrepreneurship at Arizona State U in the spring specifically for projects in Ghana and India and this video seems like a perfect match to be shown to our class. Wonder how I can get a preview...

Byron Hopewell's picture
Byron Hopewell - Nov 30, 2009

A much better approach to nation building. Just think what a corps of "New Recruits" could do with what we spend in Iraq and Afghanistan each day.

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