Helping the World's Future Entrepreneurs
Jonathan Ortmans, President, Public Forum Institute
Over time I have become increasingly confused as to the meaning of “youth entrepreneurship.” Here in the United States, invariably, the Small Business Administration adheres to the same definition as youth entrepreneurship advocates such as DECA and NFTE who serve high school age Americans and even younger. However, the World Bank and other multinational development organizations appear to be referring to anyone under the age of 40. Further still, private sector global entrepreneurship charities such as the respected Prince’s Youth Business International (YBI)—Prince Charles’s charity—narrow it to between 18 and 25. While the myth of entrepreneurs as “modern day Mozarts” in garages (to borrow Carl Schramm’s phrase) is slowly being dispelled, it seems our human instinct to avoid conversations about age is alive and well!
The reason this matters now is because governments and non-governmental organizations around the globe appear to be ramping up investment in “youth enterprise.”
Last week I was a speaker at the Global Youth Economic Opportunities Conference hosted by Making Cents International in Washington, DC. Since 2007, the conference has provided an excellent learning platform for professionals working to expand economic opportunities for young people. If you check out the list of 400+ participants—mostly people managing programs—from over 60 countries, you will get an idea of this large and growing international youth entrepreneurship movement. The conference demonstrated there is a lot happening. For example, on the government side, USAID outlined a new youth strategy and shared its experiences and future plans for increased overall funding in youth entrepreneurship to breed hope among the youth. Examples included conflict-ridden Gaza, and Kosovo where USAID designed a three year Young Entrepreneurs Project (YEP) to support young people (in this case, ages 18-35) to develop viable businesses by providing matching grants, coaching, and mentoring for fledgling young entrepreneurs.
The private sector, too, is brimming with its own youth entrepreneurship organizations. The recent formation of the Young Entrepreneurs Alliance which meets around the G20 is evidence of an increase in activity. Making Cents International and YBI are doing an excellent job of mapping the emerging field not only through efforts like YBI’s development of a working group within the Aspen Network for Development Entrepreneurs (ANDE), but also through publishing regular reports on trends and programs—the latest of which was released last week entitled, ‘Closing the Gap’—part of a Making Entrepreneurship Work series. The report does an excellent job of showing the importance of non-financial support such as training and mentoring in reducing the risk of lending and substituting for collateral and other types of guarantee. What the report’s case studies also illustrate is that youth entrepreneurship programs have many allies and supporters around the world and are flourishing. For example:
- The Centennial Fund (TCF) and Saudi Credit & Savings Bank (SCSB) partner to expand business start-up opportunities for youth in Saudi Arabia.
- The Canadian Youth Business Foundation (CYBF) partners with the Business Development Bank of Canada (BDC) to increase access to finance for young entrepreneurs.
- Government guarantees in India enable an increase in access to capital for young entrepreneurs through public-private lending partnerships between Bharatiya Yuva Shakti Trust (BYST) and Bank of Baroda and Indian Bank.
- In Israel, Keren Shemesh partners with Koret and Otsar Ha-Hayal Bank to serve young entrepreneurs.
- The Inter-American Development Bank (IDB) monetises non-financial support to scale youth entrepreneurship initiatives in Argentina, Colombia and Mexico.
- TechnoServe has developed financing partnerships to expand its business plan competition in Central America and the Andean regions for hard-to-serve youth entrepreneurs.
- Silatech partners with Al-Amal Microfinance Bank in Yemen to give young entrepreneurs their first opportunity to access formal finance.
Such reports and youth entrepreneurship conferences though seem to tell only part of the story even though it is being written by so many young people. Startup Weekend, for example, is one of a dozen examples of interventions across the globe to support entrepreneurs that is enormously successful in spurring the creation of new firms founded by people mostly in their 20’s. However, Startup Weekend is not on the agenda of the youth entrepreneurship community and I am guessing would not define themselves as a youth organization.
I am not discouraging weighting investment in favor of younger generations. Beyond it being smart economics, it is of course the right thing for any society to do to nurture its young—especially during times of historically high levels of youth unemployment. And this after all is the premise behind Global Entrepreneurship Week which is guiding millions of younger people to consider launching a firm sometime in their career. However, I am suggesting that we need to be more precise in our thinking—and in the analysis of our programming—if we are to develop sound evidence as to what works in helping indigenous peoples create growth firms that build their economies, solve problems and create jobs.