A Real Disruptor: The Rising 2 Billion

As a kid, I believed that everyone’s aspiration was to be a millionaire, it was simple and clearly definable. I didn’t expect to get there with the same naivety of some of the younger millennials, but I thought that it was an appropriate ambition to have. My grandfather explained that the easiest way was to find something that you make £1 on and 1 million people need (want is probably more important than need). Since then I’ve realised I’m not really motivated by the money scorecard, but the concept stuck. So, what about £1 that 2 billion people need?

Looking beyond what is in front of me

In my efforts to broaden my empathy and understanding of different view points, I am making an effort  to spend time around a greater variety of views, rather than mostly only people on my Facebook feed who generally tend validate what I already think to be true. I have been attending talks at the Institute for Global Prosperity and going to debates at the Landsdowne Debating Society (And of course continue to read 1-2 books a week). By listening to contrarian or at least alternative viewpoints, my ambition is not to debate “logically” or simply to agree, but to listen and try to understand, so my own view point of view can evolve and mature.

At one of the debates, a debater talked about how real wages haven’t increased for the working class in the UK for the last few decades. I would have argued lifestyle has, but that was not why I was there. There was a general consensus that Globalisation has not benefited all ~60 million UK citizens equally. There was then the natural immediate accusatory jump by the proverbial loud voices in the room to accuse the ultra wealthy of exploiting the system. After some time a gentler voice came through, almost as an apologetic after thought, mentioning how globalisation has benefited the rising 2 billion more substantially. This piqued my interest, it wasn’t the first time I had heard the concept, but it was the first time I had seen the two strands inter-woven. On reflection, it’s amazing how sitting quietly and just observing can benefit you far more than any antagonistic argumentative approach – who would have thought?

The 2 Billion – $1 or less per day

There are a few definitions to the concept but basically it refers to the roughly 2 billion people living on a $1 or less per day (Compare this to the US definition of poverty which is $12-$40 dependent on household size). As technology is democratised (read mobile phone networks), it is expected that that this $1 will exponentially increase and evidence suggests it is happening already. So circling back to the 60 million UK citizens who in their view are no longer benefiting from Globalisation, who, if we are honest, generally have it pretty good, surely as a nation we can afford, no we have a duty, to let this flat line or even decline to some extent, so that 2 billion can improve their lot.

The Pretenders vs the Real Disruptors

“Necessity is the mother of all invention” – Unknown (sometimes ascribed to Plato) 

In many ways, things are too good in the UK. There is limited opportunity to develop the “bush mechanic” problem solving mindset borne out of scarcity, as there is relative abundance, my kettle breaks, Amazon Prime with same day delivery, tea crisis averted.

In South Africa there is an expression “‘n Boer maak ‘n plan” – a farmer makes a plan, implying that whatever resources they have, they will MacGuyver it to fix what is broken.  I’ve heard about hotel receptionists in India who speak of the difference between Indians and Westerners. When a Westerner comes down to say they can’t charge their phone,  Westerners have tried one or two plugs and it didn’t work. Indians would have tried every plug, every adaptor, re-wiring the TV and using a paperclip.

This point is further evident when I attend FinTech events and listen to the pitches “…we are disrupting….revolutionising…meeting the need…$1 billion market.” Their solution is generally cheaper, quicker, easier and/or more convenient, but still the same. Saying they are disrupting is like saying Usain Bolt disrupted the 100m (granted not the worst association), but where are the Fosbury flops?

TransferWise* and PayPal* have made things cheaper, more convenient, but what has really changed? I still pay from my bank to theirs, I still enter their details. Compare this to the African solution where people don’t need or have a bank account, as they were previously excluded from the economic system. TransferWise and PayPal meet M-Pesa, it is 6 years old, ancient in the tech world, around before FinTech was even a term, financial intermediaries not needed, they are including 100s of millions of people that the global economic system had excluded. That is disruption.

UberPool* are looking to solve the environmental burden of owning individual cars and the costs of moving customers without adhering to rigid timetables, using individual contractors to adjust supply to meet demand. Compare this to how for decades the minivan taxi service in places like South Africa has been meeting the same need, by independent contractors finding people going in the same direction. No mobile phone required, just walk to the end of the street and holler. Yes they have their problems, but if you think the alternative could have been 3-15 cars per minivan clogging up the roads and polluting the skies. Or quite simply people unable to go to work.

Globalisation Inclusion & Opportunities for all

In India “house boys” are mobilising, before they were isolated, now any standard agreement comes with a mobile phone. Using this they can network with other people and find out the “going rates”, making their supply of labour more agile and reducing (certainly not eroding yet) exploitation that had previously existed due to significant information asymmetry.

For us sitting in UK apathy, we need to wake up! Western European dominance is a historical anomaly, a mere blip in the Millennia, perhaps driven more by luck than ability, with two key factors in my view, firstly that of being just out of the reach of Ghengis Kahn (Listen to the fascinating Wrath of the Kahns on your favourite Podcast player) and the second being the necessity to focus on nautical development due to small countries surrounded by large seas.

A lot of people are focusing on improving (not disrupting) existing solutions, not enough resources are being focused on trying to solve the problems of the 2 billion. What is clear, is those that do, will not only give a massive social benefit of helping lifting the 2 billion out of extreme poverty, but I’m sure there is money to be made in the process. £1 that 1 billion people need?

For True Disruptors some great places to start exploring:

  • Blue Economy 2 Billion extra people looking for their share of the Earths resources, will mean that we need to be far more efficient with our resources.
  • Refrigeration – Arguably the #1 thing holding India back from joining the global middle class is not lack of education or motivation. It is refrigeration. It is a hot country. Hours of labour hours are spent on daily treks to the market and back. Significant portions of food gets wasted.
  • Logistics – We are talking about 2 billion people here.
  • Education – There is not the same level of apathy towards education as sometimes found elsewhere. But we need to stop thinking sending 20 year old text books is the solution, they are demotivating at best. Doing Good Better explains how de-worming tablets, uniforms and providing sanitary pads have a far greater impact. The next step is a medium and curricula that suits the world they live in, not the antiquated methods developed during the industrial revolution.
  • Consumer goods – Without being privy to their future plans, I imagine the likes of  L’Oreal and Chanel will continue to release new, perhaps even marginally improved products all the time to the same set of consumers. I speculate Unilever is thinking about the 2 Billion.
  • Sport – There is a sport played in almost every village throughout India, called Kabaddi, it even competes with Cricket for attention. Only recently has someone thought to televise it in a national league. Creating instant heroes, a ready market. Sport unites.

*I love and regularly use Transferwise, Paypal and Uber. This was written to make a point. If anyone from those companies is reading, please don’t suspend my account!

While I realise that the 2 billion, cannot simply be bucketed, as each grouping will have different constraints and opportunities, it is useful to make the points made.

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