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Seeing crisis as opportunity

Stacey Vanek Smith May 23, 2008
Boys drink through Lifestraws Courtesy of Vestergaard Frandsen

Seeing crisis as opportunity

Stacey Vanek Smith May 23, 2008
Boys drink through Lifestraws Courtesy of Vestergaard Frandsen


KAI RYSSDAL: The news today that the Burmese junta has decided to allow all foreign aid workers into the country is good news on the face of it. Or perhaps its a sign of how bad things really are getting there.

In China, the official death toll from the earthquake almost two weeks ago is now above 55,000. Relief workers in both countries are coping with a blizzard of complications, from finding shelter and transporting food to supplying clean water.

Most often it’s NGOs and governments that take the lead in providing that kind of aid, but they’re increasingly being helped by businesses, big and small.

From the Marketplace Entrepreneurship Desk, Stacey Vanek Smith reports.

BOB SALTER: You can see how filthy this is. I mean, no human being would even dream of drinking it.

STACEY VANEK-SMITH: Bob Salter pours gritty, brown water into a soft-sided plastic pouch. He’s the CEO of Hydration Technologies in Oregon. The pouch is called an X-Pack. It uses plant cellulose to filter contamination out of the water.

SALTER: Quite tasty, actually.

Salter’s main client is the military. But he’s shifting his focus to humanitarian aid. He says there’s more opportunity there. Nearly 6,000 people die every day because of a lack of access to clean water. And the global market for water technology is expected to balloon to $600 billion by 2015.

Naomi Klein is the author of “The Shock Doctrine: The Rise of Disaster Capitalism.” In her book she criticizes governments and companies that take advantage of crises to achieve their own ends. But, she says, there’s nothing wrong with companies profiting from products that help alleviate suffering.

NAOMI KLEIN: I don’t think there is an ethical problem in seeing crisis as opportunity. Most of these crises are telling us something — that our economic system needs more regulation, we’ve had a bubble that’s burst. And it’s telling us that climate change is a reality. We need to heed these crises and, of course, we need to respond.

More and more for-profit companies are responding. John McArthur is CEO of Millennium Promise, a nonprofit committed to fighting poverty. He says corporations excel in finding workable solutions to existing problems.

JOHN MCARTHUR: Companies have a lot of assets, a lot of talents, a lot of skills, often a lot of technologies. And we see that those technologies and skills can make incredible contributions when deployed on the most-pressing problems.

McArthur points to cell-phone giant Sony Ericsson bringing Internet access to remote regions, drug maker Novartis developing malaria medicine, and Sumitomo Chemical’s treated malaria nets.

And it’s not just big businesses getting involved. Mikkel Vestergaard-Frandsen is the CEO of a Geneva-based company that makes a variety of disaster relief products.

Mikkel Vestergaard-Frandsen: Entrepreneurs have a can-do attitude that is highly needed to develop new tools, new ideas, new innovation.

So far, Vestergaard-Frandsen’s best selling product is a malaria net. But it’s the need for clean water that is driving entrepreneurs like him to produce some of the most interesting innovations.

Vestergaard-Frandsen recently developed the LifeStraw. You can stick the 12-inch tube into the filthiest river or lake and suck out clean water. In the last couple of weeks, aid organizations have ordered more than 40,000 LifeStraws to send to Myanmar and China.

Vestergaard-Frandsen: We manage very well to combine doing business with doing good. Our entire concept, which we refer to as humanitarian entrepreneurship, is focused on the strategic alignment between corporate objectives and development goals.

SALTER: Insert the filter into the can. . . .

Hydration Technologies’ Bob Salter says he’s finding all sorts of benefits from that alignment. He says he and his employees are much more motivated and excited about their jobs.

SALTER: There are financial considerations. In any business you need to stay alive. But at the same time, it’s tremendously rewarding if you can help people in crisis. It’s great to be able to do both.

Salter says it’s been a magnet for investors, too. He says venture capitalists get very excited about the company’s humanitarian goals. So much so that they are often willing to take smaller profits than when his company was developing products for the military.

I’m Stacey Vanek-Smith for Marketplace.

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