Walk the Talk

The USAID, our country’s primary agency for doing good works around the world (about $47 billion worth in FY2012, USAID Fact Sheet), has jumped on the “let’s help young people create solutions to the world’s problems” bandwagon with a new program, the Higher Education Solutions Network (HESN).  I heard about HESN recently since the USAID sent a serious chunk of change ($25 million) to my alma mater, MIT (specifically the D-Lab), in November to lead a group of six other institutions of higher learning over the next five years in a program that is “intended to fight poverty by developing and evaluating useful technologies for communities around the globe” (MIT News).   While I think the intention behind the HENS is good and I can’t complain about more money being available to people who may start technology-based companies for global health, I always wonder how effective these programs are first, in developing technology (or more importantly, making products) and second, in making a difference in the lives of the intended beneficiaries.  As regular readers of my posts know (cf., “Singin’ Be-BOP”), my skepticism results from observations that:

  • the academic world is awash in technological fixes for many problems of poverty (e.g., Global Health and Innovation Conference 2013)
  • there is little empirical research to support the idea that university-originated technologies decrease poverty (I’d be happy to be corrected especially by a study from MIT’s  Poverty Action Lab); and
  • turning university-originated technology into products, especially products meant for needs and markets in the developing world, is very difficult and requires more than talking and grants.

So what specifically will the USAID-funded MIT program do?  One half of the funding is for an International Development Innovation Network (IDIN) which “will create eight innovation hubs and venture accelerators worldwide that will support and connect promising technologies and innovators to the resources and training necessary to bring solutions to the populations that need them most” (IDIN).   As I understand it, this Network will be an amplification of the International Development Design Summits which the D-Lab has organized outside the US since 2007 to create a “user-based community of active, creative designers [who] can invent, innovate and inspire each other to create new technologies” (IDDS).  I understand the inspiration part but did not find any stats on what happened to the new technologies created by IDDS participants.  The IDIN will be more directed toward venture acceleration and providing “resources,” but I could not find any specifics on how this will be accomplished.  In my experience as mentor in MIT’s Venture Mentoring Service and elsewhere, venture founders benefit from advice and connections from sector-specific, former entrepreneurs and, not surprisingly, money from interested and involved investors.  The other half of the funding will go into the Comprehensive Initiative for Technology Evaluation (CITE) which will evaluate technologies (or products? a big difference) along the three axes of:  suitability (is the product needed by the intended user and will it work as intended); scalability (can the product be used widely); and sustainability (can the product be provided over the long term) (CITE and MIT News).  While it makes sense to standardize the way in which technologies and potential products for poverty alleviation are evaluated and certainly in the interests of USAID to do so, since it or its subcontractors may be buying those products, I would think that CITE will be just confirming what the inventor(s) should have done in the first place, i.e., figure out if the technology/product is needed and how to distribute it to those who need it.  The best test of a product, of course, is the marketplace, and two notable attempts to create an on-line marketplace for technologies for the developing world is Kopernik that, although inefficient since it is donation-based, lists dozens of products (Kopernik), and Maternova, for birth-related products (Maternova).  Perhaps, CITE could start by performing the equivalent of Consumers’ Report evaluations on these products.

As I noted first in a post in 2010 (“USAID and Innovation”), the USAID under its new director Rajiv Shah is promoting innovation in technology and policy for international development and clearly the HESN and the new MIT programs are extending that effort into the universities.  However, as I noted my review of the USAID participation in the grant-giving Savings Lives at Birth program (“USAID Rhetoric or Reality”), the USAID needs to employ the several well-recognized means of venture initiation and support like experienced advisers and engaged investors (unlike those giving “no-stings-attached” grants).  The main USAID program for funding non-/low-/for-profit start-ups is its Development Innovation Ventures program (DIV), which I’ve mentioned before (“MONGO Bingo”).  It now has a nice portfolio of 28 “ventures,” and it will be interesting to see how USAID tracks the success (and expected failure) of these, learns from the effort, and improves the DIV program.  Of course, as I wrote in “USAID Rhetoric or Reality”, USAID should also be learning from successful venture acceleration programs like the MassChallenge, which has turned about $2 million in funding each the last three years into $365 million invested by others in new ventures (MC).  Perhaps, the D-Lab and its fellow institutions could figure out away to sponsor its IDIN and CITE “graduates” to apply to and attend MassChallenge or a similar venture acceleration program.  I think it could be done for under $500K per year, or way less than the portion of the grant going into institutional overhead.

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