Kalsoom Lakhani is the Founder & CEO of Invest2Innovate (i2i), a global social enterprise intermediary that matches investors with social entrepreneurs in emerging markets. Today i2i celebrates its official launch and we celebrate the opportunity to learn more about it, and its Innovative founder.
Capital I Innovation Interview Series – Number 6
How essential has innovation been in your career to date; and how important do you envisage it being going forward?
Innovation is a very intrinsic part of Invest2Innovate – we even use the term in our company name! The nexus of business and charity is an evolving and disruptive idea, and it’s not always applicable, nor is it always perfect. But it is challenging traditional notions of giving in order to magnify social and environmental impact. That fundamental idea lies at the core of i2i and the ecosystems we are attempting to build in emerging markets.
i2i also works with dynamic entrepreneurs who are introducing innovation into their respective sectors – agriculture, energy, housing, health, the list goes on. We are, and will always be, looking [at] how to incorporate innovative thinking in order to alleviate poverty, and will always support entrepreneurs who are taking similar approaches in these societies.
What do you think is imperative to allow ‘Capital I’ Innovation to occur?
I think the broader ecosystem is a necessary component for Capital I innovation to flourish. Government support and policies that promote entrepreneurship and innovative ideas are key, but so [is] the support and empowerment of grassroots organizations, business incubators, universities, etc.
What do you think are the main barriers to the success of innovation?
When governments suppress freedom of speech and halt the free-flow of information and ideas – innovation comes from collaboration, listening, and learning. That process is halted when there is no freedom to challenge the status quo.
If you could give a ‘Capital I’ Innovation Award to anyone, who would you nominate?
Wow, where to even begin? Steve Jobs from Apple, Bill Gates for The Bill & Melinda Gates Foundation and the attention he has brought to vital poverty-related issues, Mark Zuckerberg from Facebook, Mohammed Yunus from Grameen Bank, Jacqueline Novogratz for Acumen Fund, Jack Dorsey who founded Twitter, Jeff Skoll, Hasan Abed from BRAC, Mukhtar Mai from Pakistan, Gloria Steinem, the list goes on.
Do you think that location matters?
These days, I don’t think location matters since we are so globally interconnected. But having more open societies definitely allows for the freer flow of ideas, and the ability to come up with innovation. We definitely see “hubs” of social innovation in the world due to more well-developed ecosystems in those countries (India, East Africa, and Latin America).
What was your impetus for founding Invest2Innovate?
I founded Invest2Innovate, or i2i, because I wanted to address what I perceive to be a space in the growing social entrepreneurship field. Invest2Innovate’s core model provides tailored services to entrepreneurs to maximize their social impact and match them with investors/funders.
But more broadly – i2i believes in the larger ecosystem approach to the markets we work in, and we focus specifically on the “untapped” emerging markets – countries where there is potential for the growth of entrepreneurship, specifically enterprises that take market-based approaches to poverty alleviation, but where the broader ecosystem is still underdeveloped.
In markets like India, East Africa, and Latin America (Brazil and Mexico especially), we have seen an impressive flow of capital, matched by the growth of business incubators, accelerators, consultancies, even in some cases government policy that allow for innovation to truly flourish and succeed. It is not perfect and is still evolving, but it is inspirational.
i2i aims to cultivate similar ecosystems in the markets that are “untapped,” beginning in Pakistan, fostering local networks and collaborations, as well working with regional and global partners to help entrepreneurs achieve and maximize their objectives.
What do you hope Invest2Innovate will accomplish?
I want to help change the conversation happening on the ground regarding the nexus of traditional charity, development and business. There are certainly instances where traditional development is more appropriate, but I hope to help jumpstart dialogue on what has and hasn’t worked, and how entrepreneurship, through job creation and income generation, can ultimately serve in poverty alleviation and provide services with dignity to low-income communities.
i2i won’t be able to do this alone and this will not happen overnight, and we strongly believe in the power of collaboration and partnership to help achieve these goals. At the end of the day, we can only serve so many social entrepreneurs every year. But, if we can help construct the broader environment, our impact will be magnified.
Have you already got investors and social entrepreneurs lined up to take part? If so, can you tell us who?
Sure – so far, i2i will be working with EcoEnergy Finance, a non-profit that provides clean energy solutions to the rural poor in Pakistan, and Milk-Op, which is a for-profit social enterprise that provides income generation opportunities for small-scale dairy farmers and aims to improve the dairy cold chain in Pakistan. I have a few other social entrepreneurs (and investors) in the pipeline, but I don’t want to jinx since they are in the process of being solidified!
How do you see i2i differing from the traditional micro finance model?
Micro finance as a whole is going through so much flux, and its definitely part of the industry. Micro finance does smaller loans, and focuses on those smaller businesses. But there seems to be a missing ‘middle’ between big businesses and micro finance, for SMEs who are looking to grow their own businesses. That’s where we see the potential for job creation.
Does that mean you are, in essence, looking to grow a ‘middle class’ of business?
I think that it already exists to some extent in some of these markets. But, they don’t have the support they need to really flourish and to maximise their potential or even know how to attract capital.
While I wouldn’t take the credit and say that we’re going to grow a middle class, I would say that we would love to be contributors in order to provide the support that a lot of these businesses need. And then by providing that environment, by doing workshops and helping with broader media campaigns, to help inspire others to go into this field.
How is Innovation viewed in Pakistan?
Considering we continue to recycle the same political parties over and over again, and can never have an honest conversation about what’s wrong in the country without pointing fingers, I’d say we have an uphill battle to climb when it comes to innovation. That being said, I know so many amazing and innovative individuals in the country who are truly changemakers – they keep me inspired and hopeful.
Do you have examples of Innovative Pakistani companies and organisations?
Yes! Naya Jeevan is a social enterprise, providing microinsurance to the urban poor of Pakistan; Monis Rahman launched Rozee.pk, the largest jobs site in the country, Seema Aziz is the female entrepreneur behind Bareeze but also Care(schools), Saiban and Ansaar Management Company (AMC) are providing low-cost housing in the country for the poor, the Kashf Foundation is one of the larger and more successful microfinance organizations, Telenor Pakistanpartnered with a microfinance bank to launch a successful mobile banking initiative, the list goes on!
One could imagine that it is a difficult time to be trying to create a positive bond between the US and Pakistan with, at least certain parts of, the media painting a a strange and convoluted picture of the relationship between the two countries.
Its interesting because I’m part of this network of young innovators in their early twenties called the Sandbox network. About a month ago I was able to pitch i2i to them and present challenges which the group answered.
A few people in there were really swayed by the news, saying, “Well no one is going to want to invest in Pakistan.” That tends to be what a lot people say. It’s obviously disconcerting as things appear increasingly more volatile on the ground; but my experience has been that there’s a lot of opportunity in the country that I really want to highlight.
When you’re in the country itself there’s such a palpable energy and there’s such potential for change. There’s such a large percentage of the population that’s young and really wants to work for the betterment of the country.
I don’t feel that we’re going to get a huge influx of US investment overnight, and that’s where I see the challenge and the opportunity to help change perceptions. But I also believe in the idea of building indigenous networks first… being able to build local investment capacity, as well as the diaspora network. A lot of the issues facing Pakistan have forced me to think pretty creatively about the process.
I think there’s a lot of opportunities in Pakistan BECAUSE there are so many issues facing the country and that 66% of the population is living on under $2 per day. Because of those statistics I really feel like there’s a huge amount of opportunity that entrepreneurship can bring, and there’s a lot of movement within the government.
The Planning Commission of Pakistan has been making a lot of moves and recommendations to the government to allow for a more productive environment for entrepreneurship. Its not going to be easy, and there’s obviously a lot of obstacles, but I think that the window of opportunity is right now.
Congratulations on your launch. Can you give me some details on it?
I decided to launch in September because I wanted to time it withSoCap. We won one of the scholarships to SoCap, so we’re going to be blogging throughout the conference for their blog. We hope there’s going to be opportunities to get more visibility at the conference.
And then I go to Pakistan right after, where we’re going to be doing a lot of meetings and developing our local mentor networks. We’re going to be doing mini launches and panels with our partners on the ground. There’s a lot of great platforms we’re going to be looking at, like round tables, to be able to explain what i2i does. We’ll also to be able to give a platform to a lot of the social entrepreneurs that are already in the country. Its almost like doing a road show while I’m there, as well as starting up a local entity and hiring someone to start the [local] team.
Then I come back to DC in October where I’ll be doing our launch here to help create a community that’s based in D.C.
As well as your blog for SoCap, will you also be blogging through your time in Pakistan?
Yes, I’m one of the managing editors of Think Change-Pakistan which tracks the social entrepreneurship and innovation space in the country. What I’m hoping to do is daily dispatches from the ground as I experience different things. My tumbler account is much more informal, where I’m posting videos and quotes, looking at the things I go through in the process and things that inspire me every day. But I look for the dispatches to be more formal as I go on the ground and work more closely with our clients, develop our mentors and keep people informed. I believe in transparency and I want people to feel invested in Invest2Innovate.
It seems that there is a long tradition of community collaboration in Pakistan.
Very much so; that’s also evident in the Diaspora network. A lot of money that flows into the country is actually coming from remittances from the Diaspora network.
I assume that that tradition will assist in fostering the business collaboration you look to engender.
I’m really hopeful for that. One thing that’s really wonderful about the social entrepreneurship space, as opposed to just the traditional business space, is its much more of a collaborative space. Everyone I’m partnering with is so open to the idea of fostering a community. Because I have such open partners and such amazing potential collaborations already in place I feel really confident that we can help to develop this community.
This how we aim to enter every community we work in. Obviously we’re starting in Pakistan but if we look at scaling to Sri Lanka or Egypt, the way that we do it is by developing these local networks.
Why is Invest2Innovate focussed on emerging markets in particular?
The need is great in emerging markets – particularly because they are still developing and the percentage of the population living under the poverty line is relatively high – in Pakistan 66% of the country lives under $2 a day. By virtue of taking these market-based approaches, entrepreneurs can ultimately create jobs, generate income, and provide much-needed services to a very large percentage of these societies, and contribute to a much larger economic impact.
Do you see i2i having a footprint in Egypt, with its huge potential market, and Libya, which has been in the news so much recently?
I was recently at an event where I was asked, “If I got you investment tomorrow, would you go in [to Egypt] now, rather than in three years?” My answer was No.
I think that Egypt has some figuring out to do right now, as does Libya. There’s a huge surge of energy, but there’s a lot that needs to be done before they can be considered to be emerging markets. I’m really excited about the opportunities that Egypt could have in the next year or two, but I’m waiting to see which direction it goes in before I commit.
Sri Lanka is a really interesting case as its post conflict. Though conflict has been an intrinsic part of that society, the government is really open to businesses to come in. Its a very open society in terms of entrepreneurship, so there’s a lot of opportunity there that I’m really excited about.
What are your long-term plans for i2i?
I have a five year and ten year plan. I would love us to be the intermediary or first mover in every untapped market in the world. I’m focussed on Pakistan for the next three years but I’m already thinking about where I want to scale in the next five to six years. I’d love to have a lot of legitimacy with investors but also a lot of credibility within the markets that we’re working in. We’d like to be in at least two or three markets in the next five years.
If someone wanted to get involved in i2i, what should they do?
The can email me. I’m always available to accept help. I’m at the stage right now where its kind of overwhelming, in an exciting way. I’d love to have people who are excited and impassioned about the idea get involved.
Prior to i2i, Kalsoom was the director of Social Vision, the venture philanthropy arm of ML Resources, LLC, a private investment firm based in Washington, D.C. Social Vision provides seed grants and hands-on support for social enterprises and innovative initiatives in their start-up stages, mainly in Pakistan.
Kalsoom is a managing editor and helped launch Think Change-Pakistan, a blog that tracks the social entrepreneurship and innovation space in the country. She also founded and runs the popular blog, CHUP, or Changing Up Pakistan, which was established in January 2008 and aims to raise awareness on the issues affecting Pakistan through news analysis, interviews, and contributions by young Pakistanis. She has written for the Washington Post, the Huffington Post, Foreign Policy, and Pakistan’s Dawn Newspaper. Prior to her work at ML Resources, she was a senior analyst at Lincoln Group, LLC, a strategic communications firm based in Washington, D.C.
Kalsoom has a B.A. from the University of Virginia in Foreign Affairs and Middle East Studies, and an M.A. from The George Washington University’s Elliott School of International Affairs in International Affairs/Conflict Resolution. She is originally from Islamabad, Pakistan.