Sebastián Salinas Claro, 24, a recent business graduate of Chile’s Universidad Adolfo Ibañez, has masterminded a new business generation model that is both lucrative and has the potential to lift communities out of poverty.
BalloonVenture, currently up and running in Kenya and to be launched later this year in Chile, works under the assumption that poverty is best tackled not only through charitable aid, but through encouraging the generation of small to medium business enterprises within communities.
“If you go to Kenya, you will soon realize that directly giving someone bread, or money, or housing is not enough,” Salinas told This is Chile. “The solution to poverty is entrepreneurship. What we do is simple – business graduates pay us to work with local entrepreneurs for eight week programs and develop business ideas in a creative and competitive environment, afterwhich we fund the best idea through equity. The results have been amazing.”
From Araucanía to Africa
Salinas first started developing his idea in Chile in 2010. He went down to the south of the country to work with local entrepreneurs and merchants in Mapuche communities to help them improve their business models. Using the strategic management tool Business Model Canvas, he helped create sophisticated business models for existing creative enterprises, with positive results.
“I remember working with these women who were making incredible clothing and selling it for very little to friends and neighbours,” Salinas told This is Chile. “Together, through prompting them to ask the right questions, we were able to improve their business models hugely.”
Salinas started the company EmpreDiem with an eye to setting up further social innovation projects, and shared his story on the website Business Model Innovation Hub. Soon he was contacted by Josh Bicknell, executive director of Kenya Works, an east African non-profit that uses job creation to help impoverished youth.
Bricknell was eager to get Salinas out to Kenya to work with him and, along with third partner Douglas Cochrane, they soon launched Balloon Kenya. In its first year, 11 business grads from U.K. universities worked with local entrepreneurs, and after a successful pilot period, Bricknell and Cochrane will be running this year’s program for 41 graduates.
Asking the right questions
In a guest post on Business Model Alchemist, Salinas wrote about one of the success stories to come out of Kenya in the town of Salgaa.
“In Salgaa there is no rubbish collection. All waste is either dumped on the streets or burnt,” he explained. “Sparks (a youth group in Salgaa) came to us seeking help to develop a solution to this problem. Initially, they didn’t imagine starting a business, instead believing the solution to be a volunteer community-cleaning programme. By using the Business Model Canvas we helped them discover a more interesting opportunity altogether.”
Salinas is clear that he does not provide solutions; he helps people ask the right questions. Eventually, members of the youth group had formed a profitable business model whereby organic waste was collected and sold to farmers at US$10 a bag to be used as fertilizer. Next, they devised a plan whereby work carts would be rented on days when they were not collecting rubbish.
“Using the canvas they envisioned, imagined, developed, and refined a very exciting business model with three potential revenue streams. A business that achieves two goals at a time. It cleans-up the environment and provides unskilled youth with jobs,” Salinas said. “They are currently applying to the Kenyan Youth Enterprise Fund and project that their business will break even in its second month!”
Next stop Chile
As a pilot scheme ahead of Balloon Chile’s launch in October this year, Salinas worked with women in San Juan Prison in Santiago, helping them to create businesses that functioned inside the prison, or “rehabilitation through entrepreneurship” as Salinas puts it.
The initial intake for Balloon Chile will be eight graduates for an eight week program. Graduates make an upfront payment of US$3,000 for the chance to have a hand in potentially profitable businesses that benefit society.
“I’m really excited to get going in Chile,” Salinas said. “The business landscape is changing here – the words ‘social entrepreneur’ no longer imply low profits. People are starting to realize that you can make money and create great business models and at the same time change people’s lives for the better.”
Balloon Chile will begin accepting applications at the end of May. For more information, visit the EmpreDiem website.
By Angus McNeice