Global Microcredit Summit paper - The Importance of Business Development Services for Microfinance Clients in Industrialized Countries

1. 2011 Global Microcredit Summit
Commissioned Workshop Paper
November 14-17, 2011 – Valladolid, Spain
The Importance of Business
Development Services for
Microfinance Clients in
Industrialized Countries
Written by:
Connie E. Evans, President & Chief Executive Officer,
Association for Enterprise Opportunity
USA

2. TABLE OF CONTENTS
Introduction….…………………………………………...…..……………………………3
Section 1: Three Trends Driving the Importance of Business Development Services
1. Renewed urgency about the growing wealth gap and increasing poverty………..4
2. Current Focus and Push to Entrepreneurship for Job Creation…………………...7
3. Technology’s promise for changing the world………………………………..…11
Section 2: Conclusion .………………………….…….………………………………....16
Bibliography……………………………………………………………………………..17
Acknowledgements….……….………………………………………..…...…………....18
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3. The Importance of Business Development Services for
Microfinance Clients in Industrialized Countries
Introduction
What are the trends driving the importance of business development services to
underserved business owners and aspiring entrepreneurs in this period of global
economic upheaval? What challenges will they pose to current practice in the
microenterprise development industry? And what opportunities will these big trends
create for new approaches that dramatically increase the reach, effectiveness and
efficiency of business development services?
This paper is inspired by and uses the work and research, in part, conducted by the
Association for Enterprise Opportunity (AEO), the national association for U. S.
microenterprise development, where our focus is on unlocking the potential of micro
businesses for job creation. The potential is great but constrained by the complex
challenges faced by the nonprofit organizations, and other institutions that seek to
serve them. These challenges are significant but not insurmountable. They exists within
an entrepreneurial ecosystem and to achieve real game change, must be addressed with
coordinated actions among by all actors in the ecosystem—individuals, companies,
nonprofits, foundations and government.
There is no shortage of determined, committed, and capable entrepreneurs who need
to be appropriately capitalized and coached. However, there is an availability, access,
and impact problem—not just access to capital (often what receives the most focus) but
access to business development services and opportunities. Business development
services (BDS), also referred to as non-financial services, are designed to assist micro
business owners and aspiring entrepreneurs to start, operate efficiently and grow their
businesses with the goal of job creation, poverty alleviation and/or economic growth.
The array of services is wide and includes training, consulting, and marketing services,
business information, and promotion of business to business linkages, technology
assistance, and other non-financial services. In the context of the United States
microenterprise development industry, evidence abounds that many more individuals
receive business services than micro loans.
By framing the importance of business development services in the context of the three
driving forces described herein, it emphasizes the urgency for new solutions, new
partnerships and faster adoption of innovations that work. Here are the three trends
that challenge us to move forward for collective impact.
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4. SECTION I: THREE TRENDS DRIVING THE IMPORTANCE OF BUSINESS
DEVELOPMENT SERVICES
1. Renewed urgency about the growing wealth gap and increasing poverty
The global economic crisis and its aftermath mean the world faces the prospect of a
prolonged increase in unemployment, deepening poverty and inequality. You add
skyrocketing pay for CEOs, and increasing assets for those at the very top income
brackets, you’ve got a record high divide between
the rich and the poor. With the gap between the
wealthiest few and everyone else, there is a
renewed urgency for equality and opportunities
and stories of strikes and protests are increasingly
commonplace.
A survey by the World Economic Forum says its
members see widening economic disparities as one
of the two main global risks over the next decade.
Income and earnings inequality has been on the rise over the past two decades in most
OECD countries. Although there are large differences between countries, in 2008, the
income of the richest 10% was, on average in OECD countries, almost nine times that of
the poorest 10%.
The number of people living in poverty has risen in the United States for the last four
consecutive years. There were over 46 million people in the United States living in
poverty in 2010; the largest numbers of Americans in poverty since such estimates have
been published by the U.S. Census Bureau.
While America is facing its largest wealth disparity in a
generation, it’s pushing minorities to the economic
margins. That’s the finding of a new study by the Pew
Research Center. The median wealth of whites is now
20 times that of black households and 18 times that of
Hispanic households. Hispanics and blacks are the
nation’s two largest minority groups, making up 16%
and 12% of the U.S. population respectively. The
income and wealth gaps are most severely
experienced by women of color, who face the
compounded effects of gender and racial economic
disparities.
We know that the recovery is underway, but it is not a
recovery that is strong enough to bring the millions of
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5. new unemployed back to work. What can create wealth and alleviate poverty? For the
millions of people living at or below the poverty line in industrialized countries, self-
employment and business ownership through microenterprise is likely to be their most
viable option.
In the US, the median net worth of business owners is almost 2.5 times higher than non-
business owners. For a black woman, the difference is more than 10 times. For a Latino
man, the difference is 5x.
How valuable is business development services to starting a new business? In the EU
context, business development services, such as training and technical assistance are
considered to be critical elements of success for setting up a new business. According to
the 2008-2009 EMN survey of the microfinance sector in Europe, of which 170
institutions responded, the majority of institutions offer business development services
(57%). Another 27% offer referrals to other service providers. Only 19% of the
institutions did not provide any kind of business development services.
Women’s Initiative for Self
Employment, in the United
States, provides training to
low-income women to help in
starting a business. This has
been a highly successful
strategy for increasing
household wealth as well as
income through the start-up
of microbusinesses. They
provide a 20-session business management course, Simple Steps to Business Success to
primarily Latina and African American women clients. Women’s Initiative conducted a
decade-long study of their clients’ asset growth after completing the business
management course. The study collected and analyzed empirical data which shows that
their clients more than triple their overall household wealth and increase their business
equity six-fold on average of two years after participating in the business training. They
report a positive relationship between a client’s business development and their
household financial well-being. For every dollar of business equity owned, Women’s
Initiative clients have more than nearly two dollars of overall household wealth. Despite
financial risks associated with business start-up and ownership, Women’s Initiative
clients who are in business have 40% higher average household incomes and 48% more
household net worth than clients who have not started a business. After participating in
the Women’s Initiative program, one in five (20%) clients reported owning their own
home. Homeownership rates increased most dramatically for Latina clients, growing
from 11% before training to 32% after. African-American women and Latinas who
receive business management training through Women’s Initiative had the highest
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6. increase in their business equity and their overall
household wealth among all clients. Despite
starting with fewer business and household assets,
two years after training these two groups accrued
the highest business and overall household wealth.
In spite of such positive outcomes, the delivery and
provision of business development services to
microfinance clients is far away from reaching the
numbers of people affected by the widening
wealth gap. Why does this remain so? One key
reason is because so few programs are able to report their impact. AEO randomly
selected 460 organizations among the more than 800 programs we identified to assess
whether they report impact and if so, using what metrics. We found that 67% did not
report their impact using quantitative measures and only a handful of organizations
present their impact through longitudinal reporting of activities, reach, return on
investment, or other metrics.
Increasingly demanding funders and investors are eager to deploy scarce resources
against their highest potential uses. Yet meaningful information about the impact of an
organization or its interventions is often hard to find. A holistic and standard
measurement approach would permit investment in local approaches that work and
new models that can scale. Across Industrialized Countries, nonprofit organizations
engaged in business development services are typically operating with low budgets and
impact tracking and reporting is resource intensive and hard to do. Most solutions today
tend to be labor intensive and expensive. They are also scoped in ways that do not
effectively encourage experimentation and/or collaboration. To further complicate the
matter, definitions of impact and resulting measures are not standardized. As a result, it
is nearly impossible to make meaningful comparisons across different interventions at a
level that is granular enough to be meaningful.
Will better assessment of business development services open up new opportunities
for greater investment? A new approach to impact assessment is necessary and
possible. At AEO, we believe that to be successful, an approach must be:
Standardized components that are easy to tailor to nearly any organization or
intervention
Created with incentives for all stakeholders to participate and benefit
Integrated into an organization’s ongoing operations
Accompanied by resources and support for nonprofits to execute
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7. This issue of impact cannot be taken lightly. Because Women’s Initiative has been able
to present their program’s impact, they have been able to secure the necessary funds to
scale (reach greater numbers of clients) their program significantly. Can other business
development service organizations emulate this organization’s commitment to impact
assessment? Can the industry play an increased role in closing the wealth gap and
alleviating poverty? The path may not be easy, but documenting outcomes and being
able to demonstrate asset and wealth development is imperative for the industry.
Reaching more of the poor with financial services is important, equally important is
measuring the results.
2. Current Focus and Push to Entrepreneurship for Job Creation
Since the beginning of 2008, Spain, South Africa and the United States had experienced
the biggest falls in employment among the G20 countries. Spain and the United States
also saw the biggest rises in unemployment rates, followed by Britain. The new “World
of Work Report 2011: Making markets work for jobs”, published by the International
Labour Organization (ILO) states that based on current trends, it will take at least five
years to return employment in advanced economies to pre-crisis levels, one year later
than projected in last year’s report.
No one can be happy with the painfully slow recovery of jobs resulting from the
economic crisis and weakened economy. With this high unemployment, the number of
individuals motivated to become entrepreneurs is on the increase. For example, last
year, more Americans became entrepreneurs than any time in the last 15 years. Small
enterprise is the true back-bone of both the U. S. and the European economy, being
primarily responsible for wealth and economic growth, next to their key role in
innovation and R&D. In the EU, nine out of ten small businesses are micro enterprises
with less than 10 employees. If the economy of industrialized countries is going to
bounce back, it must happen on Main Street. Micro or very small businesses represent
more than 80% of all businesses in the US. In fact, they are so prevalent,
If one in three micro businesses hired just one person, the country
would be at full employment.
A key question is where will business owners turn for help to grow their businesses? The
provision of business development services is fragmented and spread across all types of
organizations. Language is confusing depending on the provider. Many microenterprise
programs that provide business development services focus on helping the underserved
to start businesses, but are not equipped with staff, products or services to help
businesses to grow.
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8. “As a funder and supporter of organizations that provide intensive
business training for start-ups, we’ve noticed that there’s so much
demand in the market for businesses that have already formed and
are now just struggling to survive… Maybe it’s someone who needs
to re-work their product mix and bring it to market. In many cases,
their needs are not well aligned with the training services provided
by these traditional models and approaches. How can we
collectively keep those folks in business and position them for
growth?” – Daniel Delehanty, Capital One
Is there enough attention being given to helping microenterprises grow? Most micro
business owners and aspiring business owners don’t get what they need to succeed.
This is unfortunate because where microenterprise development organizations serve
business owners, outcomes, such as improved survival rates, job creation, and economic
impact can be impressive. From our analysis, higher than necessary costs to serve
coupled with capacity constraints prevent Main Street business owners and aspiring
entrepreneurs from getting what they need to grow and to hire. There are not enough
services, products, or opportunities that meet the unique needs of these businesses and
their owners and that results in an availability problem.
In addition to products and services not being available, underserved entrepreneurs
must overcome additional hurdles of access, typically as a consequence of their starting
wealth. If these businesses are going to grow and hire, they will need fairly priced
capital and high impact services to support management and growth. If the
microenterprise industry can solve the twin problems of availability and access, we will
increase the impact of microfinance clients and moreover, unleash new economic
opportunities for millions of business owners and aspiring business owners who would
be able to take advantage of services.
Within the context of the US, the current microenterprise industry structure presents
nearly insurmountable challenges to effectively and efficiently reach micro business
owners and aspiring entrepreneurs with access to the right mix of capital and business
services to increase their odds of success. Current cost structures preclude nonprofit
organizations from meeting these needs. Reaching ~80% of underserved business
owners at current costs would require more than $20 billion, which represents just
under half of total giving by U.S. foundations in 2009. As demand for capital and services
increases, expense is generally growing much faster than revenue. As a result, margins
are decreasing across the board. This puts serious constraints on operating liquidity and
in the near term will put some organizations at risk. We see that liquidity constraints
threaten both large and small organizations. Although large organizations may be more
accustomed to managing against these constraints, neither big nor small organizations
are well-positioned to invest in capacity building and growth. Business development
service providers are by far the most precarious with median months of unrestricted
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9. liquid net assets steadily declining since 2006. In
2009, the median value among pure service
providers (not lenders) was one month of
liquidity.
In response to these findings, the team at AEO
has asked, “What is the path forward? Where
are the highest potential opportunities to
significantly increase the odds of success? We
think the answer lies in collective impact and
thinking about solutions differently than we
have to date. Reaching underserved businesses and aspiring business owners is not
about the size of any single organization but rather impact and total coverage from the
ecosystem of organizations and resources available nationally, regionally or locally.
To date, investments in US micro-business development efforts have focused almost
exclusively on support for program development and capacity building within individual
organizations. This approach can and has been successful. However, in order to address
the urgent and growing needs of underserved business owners and to accelerate
economic recovery in communities around the country, it is imperative to advance new
models to deliver capital and services. It is possible to strengthen and build on what
works today yet fundamentally change the game. AEO, its partners and members are
committed to reaching one million underserved business owners by scaling proven
programs and using technology for more efficient and effective allocation of resources.
Here are two descriptions that illustrate how AEO is applying this new framework.
One of the high impact business development service programs that we will scale is
MarketLink. AEO is partnering with Oregon Microenterprise Network (OMEN) to bring
sophisticated market research services to disadvantaged entrepreneurs. The approach
yields results: Business owners that have used these services generally experience
increased revenues within six months and achieve other business goals. Since 2006,
OMEN has provided these services to hundreds of business owners across Oregon. Now,
AEO and OMEN are seeking to expand the program to reach underserved business
owners throughout the country. This partnership represents an innovative business
model to provide low-wealth entrepreneurs with access to high quality market research
and marketing support services.
MarketLink includes a suite of tailored market research services to help microbusiness
owners find and reach customers, tap into new markets and make informed business
decisions. MarketLink services include:
Industry analysis and trend spotting
Sales lead generation
Social media marketing support
Competitive intelligence
9

10. Primary and secondary market research
MarketLink was developed by OMEN using the same market research and principles of
competitive intelligence utilized by Fortune 500 companies. MarketLink contributes to
leveling the playing field for smallest business owners.
AEO, along with its private-sector partners, and others are preparing to launch a web-
based marketing and matching system to connect underserved entrepreneurs with high-
quality financial products and tailored business development services. The system, a
shared utility that builds on what works today in communities across the country, will
reduce the costs and risks of delivering capital and services to Main Street business
owners without sacrificing valuable personal touch. The system represents a material
opportunity to move the needle on job creation by more effectively and efficiently
deploying resources.
The technology platform is proven: to date more than 3,500 Main Street businesses
have used it to borrow and repay in excess of $125 million. All participating businesses
will receive an actionable financial profile and matches to local resources that can help
them secure capital and grow. At launch, 30% of small businesses presently unable to
access capital from commercial banks will qualify for a loan from a community lender.
Over time, products tailored to meet the needs of additional borrowers will be rolled
out.
We are preparing to launch pilots in a handful of geographies in order to demonstrate
the potential of this marketing and matching system. As a national organization with
members in every state and relationships with a broad range of stakeholders, AEO is
well positioned to lead the creation of this critical new industry utility.
To move the
industry forward,
microenterprise
and microfinance
associations in each
of the
Industrialized
countries will need
to adopt similar
frameworks, and
develop innovative
partnerships and
initiatives, similar
to the One in Three
framework being
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11. implemented via AEO.
3. Technology’s promise for changing the world
The third trend offers great potential to improve how we all work, but even more
significant promise for underserved business owners who might find better availability
and access to services through technology. With the widespread penetration of mobile
phones and other handheld devices that connect to the Web, nearly 4 billion people
worldwide now have some level of access to computing. At the same time, the Internet
continues to mature as a gateway for “cloud computing,” in which remote datacenters
host data and serve applications over the Web for use across a broad spectrum of
devices and IT systems.1
Moreover, with the introduction of smart-phones and the explosion of video and social
media platforms, and rapid changes in the way people consume content, the universe of
online learners is likely to continue to grow and expand.
Clearly, the growth in mobile phones has been explosive, especially in emerging and
low-income markets, where they have been put to use in delivery models for micro
credit and banking, health care and education, just to name a few of the applications.
Jeffrey Bradach’s article, Scaling Impact, discusses how nonprofits are employing a number
of technology-based strategies to scale their impact without dramatically increasing their
costs (converting ‘bricks to clicks’) through the creation of tools or platforms that users can
readily adopt.2 Applied thoughtfully and in combination, to some degree, with human
networks, technology can unleash new breakthroughs in business development
services.
It’s true that understanding new technologies and their applications can be
overwhelming to those of us who are not “wired” to think that way. So here are four
approaches that provide a sense of how to imagine for the future:
The first approach is new business models. Products and services that seemed too
expensive may find themselves being implemented under a new business model thanks
to technology. Just look at MicroMentor (www.micromentor.org), an online end-to-end
turnkey solution for business mentoring. To date, this proven mentoring solution has
matched more than 3,000 entrepreneurs and mentors with impressive results: More
than 60% of the mentoring relationships contributed to both revenue and employment
growth at less than 90% of the industry average cost of delivering these services.
Because the business model relies on technology, it opens MicroMentor up to a much
broader customer base for people seeking to be mentors and those looking for mentors
than would be possible in a bricks and mortar model used by most local nonprofit
1
Unleashing Technology to Advance Social and Economic Development, Microsoft
2
Jeffrey Bradach, “Scaling Impact,” Stanford Social Innovation Review, Summer 2010: 27.
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12. organizations. Additionally, MicroMentor can add to its revenue stream by providing
access to its mentoring platform for microenterprise organizations implementing locally-
managed mentoring programs. Could this be an option for the 19% of microlenders in
the EU Study that provide no business services or referrals to their clients? AEO is
collaborating with MicroMentor to scale its operation on a national and international
basis.
A second approach for integrating technology into business development services is
new delivery models. Applying new technologies could dramatically lower cost barriers
and increase the responsiveness of delivering business information and other content.
We hear more about mobile technology applied in microfinance, as well, as small
producers using their mobiles and text messaging to get better prices in the market or
to shop around for inputs as a means to overcome the advantages of not having a fixed
location. But mobile applications are not as well developed in Industrialized countries
for the delivery of business development services.
There are a number of microenterprise organizations in the U. S. exploring and
experimenting with new delivery models that apply distance learning systems to the
delivery of business development services to clients. Findings from a study conducted by
the Aspen Institute shows that organizations are using online courses and webinars, the
phone to provide coaching and counseling, Internet and email, podcasts and videos, as
well as blogs and social networking sites.
One entertaining and perhaps more creative use of technology is Grand Café, an
educational video series that features four immigrant women helping each other grow
their endeavors after meeting in a business start-up class. It is a program by CEO
Women, a California microenterprise development organization, whose main goal is
helping women increase their business skills to become economically independent. CEO
Women is using the series to scale their 16-week business training program and over
700 women have viewed the telenovela-as-curriculum since it launched. The characters
speak English and their experiences are cataloged in a Latin Telenovela format, and the
protagonists (including a jewelry maker from Haiti, a handywoman from Mexico, and an
accountant from China) were based on the nonprofit's own immigrant and refugee
entrepreneur clients.
It is an inventive use of a format for helping women to build a start-up business and
learn English as a second language. Because it is soap opera-esque, there is even a love
story thrown in. The series and its taped questions for business clients are planned to be
made available through online distribution, DVDs, and possible broadcast.
According to CEO Women staff, they have found blending classroom and home learning
to be an effective way to reach women who are looking to grow their food, artisan, and
import businesses while managing families and work. Clearly, questions remain about
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13. the pick up by individuals, cost and return on investment of the series, but the concept
seems to be promising.
A third approach to consider is new information exchange models. Micro businesses
could become more competitive if they had quicker access to information. As one
example, each percentage point of procurement spend by the U. S. Federal government
alone that could flow to small disadvantaged businesses represents $5 billion. Just
imagine providing an innovative technology teaming and matching functionality to an
organization’s existing business development service platform that begins to open up
value chains and access to procurement for participation. Using such a model for
business owners searching for other, perhaps smaller businesses, to collaborate on
submitting a bid to provide services can be quite advantageous in helping micro
businesses to grow.
The last approach to integrating technology in business development services is that of
developing new networking models. Social networks such as Twitter, Facebook and
YouTube keep many of us connected to a continuous stream of information. These
platforms provide tools that can encourage collaboration, discussion and learning from
entrepreneurs and aspiring entrepreneurs. Information is key for any business owner,
but especially for the owners of the smallest of businesses and for those who are often
isolated and underserved. The appropriate networking model can increase bargaining
power and help to level the playing field for micro businesses.
Unlocking the next wave of potential for business development services will most likely
require a lot of technologies. Will technology be what changes the game for all
entrepreneurs? If so, then we must step up the pace in which we not only integrate new
technology-driven models, but must also work to ensure that broadband access and
access to affordable equipment is made available to underserved individuals and
communities. Technology adoption is critical, but not for technology sake. Technology is
a tool for microenterprise development organizations to use to give them an advantage.
What will it take for organizations to adopt any of these new models using technology?
Some will be good at it and others will fail miserably in meeting their goals. Integrating
technology models with business development services is not an exercise about
efficiencies or scale. Rather, it is about changing organizational approaches and
discovering innovation. To infuse innovative thinking into a culture requires thinking
strategically, rather than tactically. This strategic approach requires more than just
encouragement and open-mindedness. It requires commitment to systems and
processes that can create new solutions to old challenges.
Bringing innovation into the workplace is not an easy task. It takes more than, as some
people believe, sitting around and waiting for big ideas to happen. Innovation takes an
open-minded culture. But not all workplaces offer an environment to challenge the
status quo. There may be concerns, for example, about a substantial investment in an
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14. approach that has always been used to solve a particular problem or provide a particular
service. People become comfortable with, and most often unaware of, continuously
using the same problem-solving techniques.
Years ago, Albert Einstein defined insanity as "doing the same thing over and over again
and expecting a different outcome." To change the way you think about problem solving
requires a paradigm shift. If you seek to encourage innovation, expect resistance. The
step between individual creativity and organizational innovation often looks more like a
leap. One proven method to address a challenge in your organization about business
development services is to learn and follow an innovation process. Start with something
simple by taking on a small issue in your organization. Put together a diverse team and
create a clearly defined problem statement to be sure everyone understands your goal.
Innovation: A Five-Step Approach3
Innovation can be a learnable, trackable process that is exciting and enlightening.
Here's a process your organization can use to identify new solutions into the old
challenges in business development service delivery.
Step One: Gather Information. The team will need to spend time and devote attention
to gathering relevant data on the project. Asking the right questions, such as who makes
up the marketplace and what do they want, will lead research in the right direction.
For example, teams will want to read such important information as reports, journals,
and meeting notes. They will need to look at the environment surrounding the projects
and note useful insights they observe. They will present their information offering a
general view of their whole findings.
Step Two: Observe the Real Situation. Step two is all about looking. The team needs to
act like anthropologists and not only observe the process or system they are about to
change but document findings with notes, photos, and even videos. Beware of making
assumptions that will sabotage the effectiveness of good observation techniques.
In this step, teams will observe what confuses and perplexes an end user. They will need
to review their information carefully, perhaps often, to catch important details.
Videotapes will need to be watched multiple times. The teams can expect to begin to
see common areas of concern emerging within their project research.
Step Three: Develop New Concepts. If you approach brainstorming as a "no-brainer,"
your team will probably come up with the same old same old. Employing solid
brainstorming techniques will help generate many more solutions with greater
originality. The team leader needs to be well versed in a variety of approaches to get the
3
Rachel Fine, Blue Grotto, Inc.
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15. process off the ground.
In this step the team is applying divergent thinking techniques to a wide breath of ideas,
some of them even bizarre and impractical. Concepts within ideas will be substituted,
combined, modified, adapted, magnified, minimized, eliminated, and rearranged. In the
end, the team will have flipchart pages on the wall full of drawings of ideas, from which
they will now begin the process of choosing three or four possible ideas.
Step Four: Convergent Thinking. Take all your big-picture ideas and start converging
them into real application. Here's where the rubber hits the road, when you take your
best innovations out for a test drive. Ask yourselves tough questions: How can we
improve? What questions are not being asked? Is the focus in the right place? Timing is
critical. If this step is done too early in the process, good ideas don't have time to reach
fruition. If this is done too late, a practical application may have lost its chance to
emerge.
Contrary to the big-picture brainstorming of the previous phase, the team will now work
closely to bring together several viable prototypes, using drawings, computers, or
whatever building materials are most appropriate. They will both criticize and defend
their prototypes. They may go back to step three for another quick look at ideas.
Step Five: Implementation. In this step the team will focus on their three or four best
ideas and start to introduce a critical evaluation of the forces both for and against
implementation of these ideas. They will identify the blocks and barriers to success and
how to overcome these barriers.
Without the right implementation plan, the best innovation will sit in a file drawer
collecting dust. Ask: Who will lose if this innovation is accepted? Who will win? What are
the organizational impediments to this action plan's success? What is the organizational
readiness? The final report should include a timetable for trials, tests, and perhaps an
initial market analysis.
Innovation and technology applied to business development services offers great
potential to improve how we work with underserved entrepreneurs and aspiring
entrepreneurs. However, bringing these benefits into reality will require support and
resources from the private sector, governments, foundations and development
agencies.
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16. SECTION II: CONCLUSION
These three trends, taken along or in combination, really frame the importance of
business development services to underserved business owners and clients of micro
finance institutions. These factors drive the deep sense of urgency for investing in
building the capacity for the activities that drive impact and coverage from the
ecosystem of organizations and resources available to entrepreneurs. Microenterprise
development organizations cannot address these complex issues by themselves or even
within the silos of its own industry. The path forward will require dialogue and
collaboration among all stakeholders and the support for experimentation and risk
taking with big, bold and new ideas.
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17. Bibliography
The Promise of One in Three: Creating Economic Opportunity for All Americans to
Bounce Back, Association for Enterprise Opportunity, May, 2011
Closing the Wealth Gap Through Self-employment: Women of Color Achieving the
American Dream
Karuna Jaggar, Director of Research and Public Policy, Elizabeth de Renzy, Researcher
and Data Analyst, July 2008
Recovering from the crisis:A Global Jobs Pact adopted by the International Labour
Conference
at its Ninety-eighth Session, Geneva, 19 June 2009, First published 2009
BDS How-to Guide, UNDP (2004)
Business-Building Telenovela Launches for Female Immigrant and Refugee
Entrepreneurs [VIDEO
Distance Learning and the Changing Face of Business Development Services, Authors:
Luz Gomez and Joyce Klein, Aspen Institute/FIELD, August 2011
EMN Working Paper nº 6: Overview of the Microcredit Sector in the European Union
Authors: Bárbara Jayo, Anabel González, Casey Conzett, June, 2010
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18. Acknowledgements
The bulk of the work that informed the thinking of this paper came from AEO and the
work it is doing with many of its members and partners. Leading this work is Tammy
Halevy, Senior Vice President of Membership and New Initiatives, whose endless hours
of work and dialogue helped in the thinking for this paper. Much of the analysis and
solutions proposed in the paper are documented in a report released in May, 2011 at the
National AEO Conference in Washington, D. C. The report, The Power of One in Three:
Creating Opportunities for All Americans to Bounce Back presents the findings of AEO’s
systematic assessment of the U. S. microenterprise sector. The intent of the study is to
uncover opportunities to better reach underserved businesses and business owners. The
study was funded with generous support by the Citi Foundation. Capital One provided
pro bono support by its graphics team on the design and graphics of the report. I also
want to thank Claudia Viek, the Executive Director of CAMEO, the state microenterprise
association for California), for her thoughtfulness and profound focus on the needs of
microenterprise development organizations that provide business development services.
Lastly, I want to acknowledge the work of the many AEO members whose work I so
admire and describe within this document and thank the staff at the Aspen
Institute/FIELD for the availability of their publications.
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