By Sierra Frischknecht, Mercy Corps Global Engagement Team. Republished with permission.
Choky fears the world is passing him by. He has a successful business in Medan, Indonesia making and selling handbags, which he produces with the help of eight full-time workers and sells from his small storefront. Though he feels very lucky to have grown so much since starting the business two years ago, his sales constantly fluctuate, making it hard to make any long-term business plans.
And he worries that his small business will soon be eclipsed by others he sees online.
The rapid growth of the internet is creating tremendous opportunities, especially in the developing world where it has become increasingly accessible via mobile devices. But while many small business owners like Choky are able to see what’s happening online, they don’t have the means to use the technology to their benefit. Few businesses that provide website design and maintenance operate at a price that entrepreneurs like Choky can afford.
That’s why we have teamed up with eBay Foundation and ThoughtWorks to create Custom-Clouds, a for-profit social enterprise that will help small growing businesses gain access to web-based business services, and in so doing, increase small business revenue and job growth across the developing world.
Helping small business owners access the cloud
Custom-Clouds, announced in September at the Clinton Global Initiative Annual Meeting, will offer Choky and thousands more in Indonesia many basic web services (including mobile website design, training and a dedicated client center) for a base rate of about $10/month — affordable even for small business owners in the developing world. An on-the-ground sales and client support force can gather relevant business information and have a completed website online within hours.
Best of all, the monthly subscriptions will give small business clients constant support and free updates to make sure their websites can easily adapt to an ever-changing market.
It’s taken for granted in many parts of the world that a website is necessary for any small business. Websites makes it possible to reach more customers, advertise online and grow faster. But the impact can be even greater in countries where local markets are limited. The internet is the one way to connect with an increasingly global economy.
A recent report by consulting firm McKinsey, “The Impact of the Internet on Aspiring Countries,” found that an internet presence can accelerate growth for small businesses that creates 3.2 jobs for every one eliminated by improved efficiency methods.
Using business for good
With our investment and funding from our partners, Mercy Corps will support and oversee the start-up phase of Custom-Clouds. But by operating Custom-Clouds as “double-bottom line” business (with dual goals on profitability and social change), we are making sure it will sustain itself long after our financial support is needed.
Custom-Clouds is the most recent in Mercy Corps’ portfolio of work developing social enterprises. We partner with creative thinkers from the private and public sectors to identify breakthrough ideas, test them in the field and then scale them in multiple locations. Functioning like a business creates lasting solutions to some of the toughest challenges we face today.
In Indonesia, for example, Mercy Corps created Bank Andara, a microfinance bank that is using the world’s first mobile-enabled microfinance payment system to reach millions with low-cost loans and savings options. And in Guatemala, Mercy Corps partnered with major pharmaceutical providers to create a microfranchise network of small pharmacies in rural communities, boosting both economic growth and health in remote areas.
With Custom-Clouds’ launch in Indonesia, we aim to reach over 10,000 small business owners and break even within the first two years. Ultimately, the goal is to scale globally in the next five years, reaching 11 additional countries and creating one million jobs in some of the world’s toughest places.