Galvanizing Entrepreneurship in Pakistan

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• Galvanizing Entrepreneurship in Pakistan
• Mahboob Mahmood
• March 8, 2006

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Contrasting Definitions
Entrepreneurs have the ability to take a
business to the point at which it can sustain
itself on internally generated cash flow
(Brodsky)
Becoming Profitable
v.
The function of entrepreneurs is to reform or
revolutionize the pattern of production
(Schumpeter)
Being Innovative
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Three Essentials
Entrepreneurs
Problems
Essentials of Entrepreneurship
Enablers
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Maheen High Fashion
Panel photographs Courtesy Picture Group of
Pakistan
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Zia Chisthi TRG
2 Solicit Customers
1 Establish Remote Centre
Traditional Model
1 Acquire Customers
2 Bank-End Operations
Chishthi Model
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Royal Palm Golf Country Club
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Tameer Bank
Microfinance Bank Initiated in
Orangi Target Income Group Rs 18,000 5
year target 1,000,000 customers
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Integrated Dynamics

• Target and Decoy UAVs
• Surveillance UAVs
• Flight Control Systems
• Telecommand Control Systems
• Navigation Systems
• Data Video Download Systems
• Ground Control Stations
• Mission Simulation Software

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Madrassahs
McDonalds 1954 1 store -
2004 30,000 stores
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There is a Precedent - World Manufacturing Output
Source Paul Kennedy, Rise Fall of the Great
Powers
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Problems

• Necessity is the mother of invention

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The Power of Focus

• DARPA Paul Baran

Andreesson and Netscape
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Problem-Focused Social Entrepreneurship
Innovative Products
Community Service
Aravind Eye Care System
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A Taxonomy of Problems
Local
Regional
Global
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Enablers
Strategies Business Models
Information Education
Capital
Institutions
Paying Customers
Network Contacts
Governmental Support
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The Tomato Sale Problem
Sale period 24 hours Tractor 4
(4-12) hours Donkey 10 hours
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Track Record in Promoting Entrepreneurship
UPS Asia Business Monitor Survey January 2005
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The Roles of Government
Develop Industries Entrepreneurship
Generate Problems Demand
Eliminate Barriers
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Paying Customers
Bottom Middle of Pyramid
Committed or Supportive
Government
Early Adopters

• Infrastructure
• Defense
• Land
• Health
• Education
• IT

• Keiritsu members
• Geographically affiliated (NRPs)

Prahalad
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How should we view the poor?

• If we stop thinking about the poor as victims or
  as a burden and start recognizing them as
  resilient and creative entrepreneurs and
  value-conscious consumers, a whole new world of
  opportunity will open up.
• C.K. Prahalad
• The Fortune at the Bottom of the Pyramid

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BOP as Customers

• Cement and home-building materials, consumer
  goods (shampoos, water, food products), drip
  irrigation, educational services, financial
  services (loans, leasing, savings, insurance,
  equity), healthcare (eyes, limb replacements,
  laboratories), information services (market
  information), ICT (Internet access,
  telecommunications), household goods (biogas
  stoves, water purifiers) and transportation
  equipment.

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Paying Customers
Bottom Middle of Pyramid
Committed or Supportive
Government
Early Adopters

• Infrastructure
• Defense
• Land
• Health
• Education
• IT

• Keiritsu members
• Geographically affiliated (NRPs)

• Advantage-driven adopters
• Affiliation-driven adopters

Prahalad
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New Enterprise Strategies for Pakistan
Ride Indias slipstream!
Target niche groups!
Be a fast follower / adaptor!
Focus on products, not services!
Compete through excellence in established
industry sectors!
Focus on BOP / MOP!
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The Need for Capital
Strategic Investors
Angel Investors
Venture Funds
Investment Banks
Commercial Banks
Private Equity

• Special Opportunities
• Intrapreneurship Family Entrepreneurship
• Islamic Equity Finance
• BOP / MOP Financing
• Infrastructure Financings

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Fast-Track Intrapreneurship
The innovators dilemma
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The Innovators Dilemma
Established Product
High
X
Current Customer Demand
Disruptive Product
y
Low
Profits
Low
High
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Fast-Track Intrapreneurship
The innovators dilemma

• Skunkworks
• Clear mission around a problem / need
• Dedicated autonomous team
• Committed funding
• First opportunity for internal demand

OR BETTER YET FOLLOW THE PATH OF THE CHINESE
SWEETS KING!
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Lets Incubate a Cluster!!
Strategy
Capital
Networking
Information
New Enterprises
Suppliers
Customers
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Galvanizing Entrepreneurship
The Ansari X-prize
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The Ansari-X Prize
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Galvanizing Entrepreneurship
The Ansari X-prize

• The MAP x-Prize
• MAP-sponsored initiative ( media,
  universities, etc.)
• Pervasive problem energy savings, security
• Committed seed funding and first opportunity
  for internal demand from large groups
• Build the cluster!!