One of my favorite business school classes focused on Emerging Market Economies. We read C.K. Prahalad’s book called, “Fortune At The Bottom Of The Pyramid“, which basically described how entrepreneurs were finding cost effective ways to serve the poorest people in the world and also be profitable.
Conventional business wisdom states that one must go after those consumers with the deepest pockets and the highest propensity to spend. Prahalad argues that we have a social responsibility to help the other end of the spectrum improve their living standards and not be afraid of going bust in the process.
One of the keys that came out of helping the poor in emerging markets is the concept of micro-lending. Micro-lending is a fascinating concept which essentially pools together the funds of people in usually small communities, and lends out those funds to a select few. Together, a community is able to help each other more impactfully than if they were separate. What’s also very interesting is that the tighter the community, the lower the default rates compared to conventional banks because everybody feels a deep sense of responsibility.
THE YAKEZIE WRITING CONTEST
The Yakezie Network of 70+ personal finance and lifestyle blogs have pulled together their funds to provide more than $1,000 to be divided among three winning contestants. If each of us gave just $15 a quarter, we would collectively be able to distribute at least $600, $300, and $100 to the first, second, and third place winners who will use these funds to further their education. We hope to slowly raise much more than a combined $1,000 as our blogs flourish and the Network grows.
What’s different from the Yakezie Writing Contest is that we are not a micro-lender, but a micro-giver where we expect very little in return. Whether the recipient ever comes back to the Yakezie Network to interact and learn is up to them. All we ask is that they use the funds to help pay for their education. Students often have very little income and rely on low wages or their parents to get by. I think we can help them.
In terms of creating profits for this particular venture, the idea is to simply have corporate sponsors with a history of giving, support our initiative. Running the Yakezie Network is an absolute loss-making venture if we were to put a dollar value on the amount of time we spend building, testing, marketing, and running the Network. Hence, we appreciate any type of support we can get. The good thing is that neither Chris, nor I, or the majority of our members rely on our blogs as sole sources of income. We all do this for the love of community, the challenge of development, and the spirit of giving back.
SPREAD THE WORD AND PARTICIPATE
If you know of anybody who enjoys writing, and is looking for funds to help pay for their education, have them visit The CarInsuranceCompanies.com Yakezie Writing Contest today! All they have to do is follow the directions and write an essay answering one of eight questions. The submission window is from Monday, April 18th to midnight, April 22nd. If you would like to pledge any money to help contribute to our micro-giving efforts, please visit the Yakezie Pledge Page.
It’s been six years since adventuring down to Rio De Janeiro for several weeks to study abroad and get a taste of real life micro-lending examples as discussed by Prahalad. After a lot of thought and hard work, I’m so pleased to say that we’ve finally created our own sustainable micro-giving platform with the Yakezie Writing Contest!
Thanks for all the support!
Readers, have you had an experiences with micro-giving? There have been a number of micro-giving initiatives in India in particular and I’m wondering if there are other countries that you’ve noticed this practice flourish besides India, USA, and Brazil?