IMPACT ENTERPRISE FOR THE BASE OF THE PYRAMID

The ideas are powerful: Creating enterprises with impact. Using the power of market-based approaches to address social issues. Alleviating poverty through enterprise. Creating value with the base of the pyramid. And the stories that grow out of those ideas are compelling: Entrepreneurs, company leaders, nonprofit managers, and development community professionals are talking and writing about how well their enterprises are doing and their profound impacts on the base of the pyramid (BoP), which I define as the 4 billion or so people who primarily live or transact in informal markets in the developing world and have an annual per capita income of less than $3,000.

Not surprisingly, given this wealth of ideas and stories, the bookshelves are starting to fill with striking titles like Fortune at the Bottom of the Pyramid, The Business Solution to Poverty, Business Solutions for the Global Poor, and Capitalism at the Crossroads. Terrific books, all — replete with powerful ideas and filled with great stories of success. They show us what is possible. They are motivational. They are about promise and potential. As C. K. Prahalad, arguably the intellectual pioneer in seeing the business opportunity in the base of the pyramid, wrote about the aspirations he had for his own book: "Does it change the conversation? Does it show opportunity? Does it lead to action?"

These books have found a receptive audience. The past decade has seen a surge in the number of impact enterprises for the BoP, the provision by these enterprises of high-quality goods and services to the poor and vulnerable, and investors' growing willingness to support these efforts.

All in all, these are exciting times for those who believe that business can play a key role in addressing social issues, especially alleviating poverty, and who are interested in exploring and helping to realize the promise of impact enterprises for the BoP.

But something is missing. Hundreds of ventures aimed at serving the BoP have been launched, but comparatively few have achieved significant scale. Either they have closed up shop and gone home, or they suffer from "pilotitis" — in other words, they remain small and highly dependent on continued financial support to maintain the piloting activities. This collective failure to thrive underscores a key point: Developing sustainable, scalable enterprises is a challenge in any context, and it is especially difficult in BoP markets.

Individually, we have gained much experience. But collectively, in confronting the challenges of the BoP market, we still have yet to share and build from these experiences in a way that productively moves the entire domain forward. For example, a colleague who was visiting my office not long ago is an experienced and successful entrepreneur in the technology industry. He had become engag