- Over the years, the Development Marketplace (DM) has supported several breakthrough business models that have gone on to impact millions.
- The DM team, housed in the World Bank Institute (WBI), is launching a new phase in its business model.
- DM supports more mature, tested approaches - both nonprofit and for-profit - that can effectively leverage the World Bank’s ability to scale impact among social enterprises with a proven track record.
April 1, 2013—What is the Development Marketplace? The first “marketplace” was held back in May of 1998. Over the years, the Development Marketplace (DM) has supported several breakthrough business models that have gone on to impact millions.
But even successful social enterprises encounter barriers. Minimizing these barriers is where the Development Marketplace is spending more and more of its time. The DM team, housed in the World Bank Institute (WBI), is launching a new phase in its business model.
Educate Girls, a 2011 DM winner, is a non-profit based in Mumbai, India, that works to reform government schools that educate marginalized young girls. It launched a 50-school pilot that leverages community and government resources to attain 100% enrollment, higher attendance and improved learning outcomes. Since 2010 Educate Girls has educated 150,000 girls and 20,000 girls have been brought back to school. From the original 50 schools it now serves 4,500 schools impacting around 500,000 girls. With a projected 100% expansion in the next 18 months, one of Educate Girls’s biggest challenges is its organizational capacity.
d.light, whose technology was recognized in the DM’s Lighting Africa program in 2010, operates in Asia and Africa and provides affordable solar light and power products to off-grid populations. d.light has served 10 million people worldwide, growing at a rate of 1-1.5 million per year. Customers report monthly income gains of 30-50% because they’re able to be productive 4 hours longer each day. Despite market demand, proven products, and a capable team, d.light faces limitations on readily available working capital necessary to finance sales along the distribution chain.
These examples illustrate the lessons of the Development Marketplace—that there are three barriers that social enterprises consistently encounter as they attempt to scale: access to growth capital, the need to build organizational capacity, and regulatory frameworks that incentivize organizations to create social impact.
“The Development Marketplace is building on its competition based model to support innovative social enterprises, and also the very important intermediary mechanisms that can address these constraining barriers,” says Drew von Glahn, Development Marketplace team lead. “The combined approach accelerates the sustainability, growth and ultimately the scale of social impact achieved by these organizations.”
The Next Generation
A decade ago, the goal of the DM was to surface innovative ideas that provide the very poor with basic goods and services that are affordable. The DM has evolved since then to focus more on sustainable business models that can have impact on the lives of the poor in scale. Today, the DM supports more mature, tested approaches - both nonprofit and for-profit - that can effectively leverage the World Bank’s ability to scale impact among social enterprises with a proven track record.
The new DM model was first piloted in India in 2011 and the current focus is in India and Egypt. In both countries, the DM has worked closely with the World Bank and International Finance Corporation (IFC) teams located in the countries. This geographic focus allows the World Bank Group to gain deeper experience on how to nurture the support that will expand the reach of successful social enterprises. This support includes business development services, operational support, access to capital, and information management systems.
The Development Marketplace is building on its competition based model to support innovative social enterprises, and also the very important intermediary mechanisms that can address these constraining barriers.Drew von Glahn, Development Marketplace team lead
The DM India 2011 supported social enterprises with a successful track record positioned to scale-up. The competition targeted social entrepreneurs operating in Bihar, Orissa, and Rajasthan. In addition to $50,000 in prize money for the 14 winners, the DM partnered with the IFC's Business Advisory Services team who oversaw 18 months of capacity building and technical advisory services.
This model served as a template for the 2012 competition in Egypt, which is supporting inclusive businesses in agriculture and handicrafts in Upper Egypt.
In January 2013 the DM launched a new competition in India that targets social enterprises looking to scale or replicate in the states of Madhya Pradesh, Chattisgarh, and Jharkhand. The call for proposals recently closed for both programs—over 350 proposals were generated. The DM looks to provide support to some 30 social enterprises in Egypt, and another 20 organizations in India. The DM will provide both grants as well as capacity building services. This deep, multi-year approach allows the team to identify key lessons in the constraints and opportunities before these social enterprises—all with the goal to apply these lessons to support emerging social enterprises around the globe.