As I look over my girlfriend, Ijtsuri Viveros’s power point slides the night before she presents her thesis about the relationship foreign direct investment has on child labor in developing countries, I can’t help but think about the two things every third world country needs before they are able pull themselves out of poverty.
The first is access to capital, whether it come in the form of loans or investors who provide the capital in exchange for partial ownership in the business. Not much ever gets done without money. The reason this is a cultural change is because those with the money and power (dictators in some cases) in these developing countries need to learn how investing their own money can benefit them personally and their country as a whole. More importantly the business owners that are given the capital need to be educated that once they are given the money it doesn’t mean they’ve succeeded and can go buy a nice car or go live on the countryside. Quite the opposite is true because these budding entrepreneurs have to know once they get the money it’s time to put their nose to the grindstone and build a successful, self sustaining company.
Luckily, the traditionally secretive venture capital industry has never been more transparent than it is now. Some of the most popular VC blogs are Fred Wilson’s, Mark Suster’s and Mike Arrington’s new blog to name a few. The reason VC’s are finally divulging all their secrets isn’t because they just want to be nice guys, but because they are competing for the good deals and want to get in with the most promising company founders. Knowing what investors are looking for in companies significantly helps entrepreneurs succeed when looking to raise money.
Venture capital is also the single best way to empower minorities in society, whether it’s race, gender or any other type of minority group that is looking to bring about change. Angela Benton, whose NewMe Accelerator was recently profiled in CNN’s, “Black in America” for her work to connect black entrepreneurs with investors is doing more for the black community than any other African American in the U.S. Through her accelerator she is empowering a minority group who often feels they aren’t given an equal shot and because of this connection she provides to investors she will be just as influential in the progress for blacks in America as Barack Obama, Tiger Woods, Lil Wayne or insert favorite African American in the U.S.
The second cultural mind shift that needs to take place in citizens that live in developing countries is the knowledge that their destiny is in nobody’s hands but their own. Ever wonder why the United States is the most powerful nation in the world? It’s because the country is filled with people that wanted a better life for themselves and took the initiative to cross the Atlantic to get out of the grips of the overbearing monarch societies in Europe. Then their kids and grandkids died defending the freedom and independence of the United States from the British who tried reaping in as much cash in the form of taxes for doing absolutely nothing. Now before I get all patriotic on you, the point is the United States is the greatest country in the world because it’s filled with people that realize they own their own destiny.
On the contrary in many developing countries most will leave their fate in “God’s hands” or they have much more humble aspirations for themselves. Too many believe the situation in life they were born into will be the same when they die. Although it’s frustrating to see people in developing countries starve, lack proper medical treatment and suffer other harsh conditions, the internet has lowered the barriers of education for everyone and is responsible for increasing the quality of life exponentially faster than in any other point in history. The free flow of information helps people in all countries learn about venture capital, how we are responsible for our own destiny and everything else of interest that helps us all live longer, happier lives.
I’m happy to report that as of 5 December, 2011, Ijtsuri has received her Masters in Political Science from the University of Texas at El Paso (UTEP). Below are a couple pictures. Now to find a place to take her to celebrate!