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Great post Ben! I’m a Product Designer at First Circle, a FinTech startup in the Philippines. I think the work we’re doing generates positive social impact too, but not as much yet as Wave.
I’m happy to see you promote entrepreneurship in developing countries as a viable option for EAs. The co-founders at our startup are both supporters of EA, and they came from Europe to start the business here. A lot of the best (and most impactful) startups in the Philippines were founded by expats actually, so there’s definitely value in this path.
But even if I think this path has an expected value of high social impact for people living in developed countries, it might not be as impactful as other EA paths for them. Here’s my take:
This path should be a good fit for people who
1. Want to work in global health / poverty / development as their cause area (and not in animal welfare or X-risks) (Update, Oct. 6, 2020: Being an entrepreneur in the plant-based space is also promising in emerging markets)
2. Have a passion for startups, and have experience working in a startup or starting one
3. Are very willing (or deeply interested) to start a startup in an emerging market and relocate there for 4+ years
4. Want to spread/popularize the EA movement in the emerging market. I think there’s promise in doing this, since some emerging markets don’t have an EA group yet, or they’re still very small. (I helped co-found EA Philippines last year—before then there was no EA presence here.)
The main cons to this path though are:
1. There’s a high chance of failure, likely more so than if you started a startup in your own country. This is since you lack context about the area, and the language/culture barrier can easily mean your product won’t fit the local context.
2. You might end up making more impact if you started a startup in your own country, and just earned-to-give your earnings to GiveWell / EA organizations. This is because I think there are very few startups that benefit the poorest of the poor, since the poorest people don’t even have access to basic needs. For example in the Philippines, some areas don’t have internet, and some areas don’t even have cell service, so it would be hard to create a startup that caters to them. So even if you do start a successful startup here, the positive outcomes generated might not be as good as through donating to GiveWell charities. Maybe charity entrepreneurship would be a more impactful path.
To counter the 1st con, you just have to execute really well in starting the startup, hiring the right people, getting enough funding, and knowing the customers. To counter the 2nd, you could start the startup in the emerging market, and then earn-to-give your earnings/salary to GiveWell / EA organizations. And hopefully what you earn-to-give is comparable to what you would if you worked for a company in your home country.
Would love to hear what you or others think about my view!
Broadly agree, but:
Can’t you just provide people basic needs then though? Many of Wave’s clients have no smartphone and can’t read. Low-cost Android phones (e.g. Tecno Mobile) probably provided a lot of value to people who previously didn’t have smartphones. Providing people cell service is hard (if you’re not a telecom), but if an area has cell service but no internet you can still make useful information products with USSD, SMS, etc., or physical shops.
(I do think that many good startup ideas in the developing world involve providing relatively “basic” needs! But it seems to me like there’s decent opportunity there.)
Are there any specific tools or methods you used to start an EA group in the Phillipines? I’m also interested in spreading the EA movement in emerging markets and would value any insight you have on this.
Fantastic! I like everything about this post, except its length. I wish it were longer as I think there is a ton to learn from your experience.
Haha this is probably the first time someone said that about one of my essays—I’m flattered, and excited to potentially write follow ups!
Is there anything in particular you’re curious about? Sometimes it’s hard to be sure of what’s novel vs obvious/common knowledge.
I’d be interested in hearing about challenges in keeping employees around, both on the local and international side. If there were cases where employees from the developed world quit after trying to live in Africa, what seemed like the major factors behind their not wanting to continue? If there were cases where local employees didn’t fit in well, what happened? What has Wave done to improve comfort/productivity for both kinds of employee?
Hi Ben! I second this comment; I would love to learn more from your experience. In particular, I would love to learn more about how you have balanced working in Silicon Valley and implementation contexts during different stages of your venture, as well as more about some of the initial challenges you faced with developing/launching the product that are specific to the start-up space in development context. I am personally also very interested in this kind of career trajectory!
I second this—really interesting post and I would love to hear much more about this!
I’m curious to hear more about this. Can you give some examples of how the norms differ?
More generally, how feasible is it to export Silicon Valley’s high product standards?
Examples (mostly from Senegal since that’s where I have the most experience, caveat that these are generalizations, all of them could be confounded by other stuff, the world is complicated, etc.):
Most Senegalese companies seem to place a much stronger emphasis on bureaucracy and paperwork.
When interacting with potential business partners in East Africa, we eventually realized that when we told them our user/transaction numbers, they often assumed that we were lying unless the claim was endorsed by someone they had a trusted connection to.
In the US, we have fully transparent salaries (everyone at the company can look up anyone else’s salary in a spreadsheet). We weren’t able to extend this norm to our Senegalese subsidiary because it caused too much interpersonal conflict. (This was at least partly the result of us not putting enough investment into making the salary scale work for everyone, but my understanding is that my Senegalese coworkers were pessimistic about bringing back salary transparency even if we fixed that.)
In Senegal people seem less comfortable by default expressing disagreement with someone above them in the hierarchy. (As a funny example, I’ve had a few colleagues who I would ask yes-or-no questions and they would answer “Yes” followed by an explanation of why the answer is no.)
Exporting different norms is quite hard at scale. You need to hire people who are the closest to the norms that you want, but they’ll still probably be fare away so you’ll also have to invest a lot in propagating the norms you want, which only really works well 1-on-1. When we needed to scale our local Senegal team quickly we ended up having to compromise on some norms to do so (e.g. salary transparency, amount of paperwork).
The book The Culture Map explores these sorts of problems, comparing many cultures’ norms and advising on how to bridge the differences.
Some advice it gives for this particular example (at least in several ‘strong hierarchy’ cultures), is instead of a higher-ranking asking direct questions of lower-ranking people, the boss can ask a team of lower-ranked people to work together to submit a proposal, where “who exactly criticized which thing” is a bit obfuscated.
This is confusing. Did they just think you were scammers, not a real business at all? Or did they think of you as a business that was suspiciously quick to share this information, and trying to… I don’t know, make a power play? Something else?
I’m guessing that they assumed we were exaggerating the numbers in order to make them more interested in working with us. The fact that you’re so ready to call anyone who lies about user numbers a “scammer” may itself be part of the cultural difference here :)
Oh, I see that I was confused: I was thinking of a “user number” and a “transaction number” as things related to Wave’s bank account—as though you were trying to share information for something like direct deposit and being accused of lying. The quote makes much more sense if it’s “number of users” and “number of transactions”.
This post was awarded an EA Forum Prize; see the prize announcement for more details.
My notes on what I liked about the post, from the announcement: