April 1, 2023

Innovating from the Margins


How exclusion can drive innovation

Innovation has become synonymous with big tech and big cities and big money. Companies like Google, Tesla, Amazon and Facebook, cluster around a small number of metropolises, investing billions of dollars in innovation, tales of their derring do and engineering genius weaving their way into the fabric of our popular imagination.

The result is the emergence of extraordinarily powerful ecosystems of wealth and creativity that have for better or for worse, birthed some of the most radical, inventive and profitable innovations of our age.

This has in turn attracted further investment and more talent, in a virtual circle of inventiveness, so that our collective futures are being imagined and built by handful of companies, in a handful of cities across the world.

But what if we are missing a trick? What if by relentlessly focussing our efforts at creation on these centres of innovation we are missing out on a well spring of creativity?

What if our future could be inspired by the inventiveness and imagination of people excluded from the mainstream, living on the margins, far away from these hubs of wealth and power?

That is the bet that we have made at aidx. The logic is simple. Constraints drive innovation. Faced with the challenges of exclusion, people invent. The solutions that they create not only represent solutions to their own problems, but often have far wider applications.

By working with people on the margins of society we can help them to improve the ways in which they meet the challenges they face and at the same time identify solutions that can inspire and empower people far beyond the bounds of their community.

It is a bet grounded in experience and animated by example. Both my business partner and I have spent years working in parts of the world where people are excluded from wealth and opportunity and seen first hand how disadvantage can drive inventiveness and creativity.

One of my most memorable experiences with financial innovation for example, was not courtesy of fintech company in London but in war torn South Sudan.

In July 2010, for reasons not necessary for the purposes of this article, I was stuck in the town of Wau without money or a ticket home. Far away from base and without even the means to pay for a night in a hotel, I was at a lost as to what to do.

That is, until I spoke to a friend of mine in Khartoum, who explained to me that he could send me phone credit in increments over the coming 24 hours and that for a fee I could exchange it in the local market for cash.

Sure enough in the corner of the market I found a rickety metal stall, bounded by two poles, with phone cards hanging from a wire across the top where I was able to exchange phone credit for cash.

There was no official sanction for this, no innovation lab that could claim to have invented it, no product manager headquartered in Khartoum and no government regulation to speak off. People had simply created their own mobile money, along with a national network of vendors that meant that you could get money in and out in pretty much any part of the country. This at a time when most people in tech hubs like London, or New York were still dependent upon wire transfers to send each other money.

Car sharing is another example, an innovation that has generated billions of dollars of value. Lyft Founder Logan Green has spoken eloquently of being inspired by car sharing in Zimbabwe and of the challenges they faced persuading Americans to get in a car with strangers. Yet this simple social innovation, was standard practice in countries across the African continent for decades prior to the multibillion dollar Lyft IPO.

At aidx our work with refugees in East Africa has focussed on the amazing world of mutual aid a system of community self help that enables people to pool resources to help one another to survive and thrive. One of the most powerful examples of this practice is financial pooling, where friends and family come together to save, invest, borrow and loan in a system of self help that provides individuals and communities with access to the financial services that banks have failed to offer.

Not only do these practices empower refugees but they offer salutary lessons to communities elsewhere in the world who are either excluded from or disadvantaged by the mainstream financial system. It is an intuitive solution to a familiar problem, one that previous generations in developed countries solved with cooperative groups and mutual aid societies but has been lost in a world where big finance has come to dominate. Once again it is excluded communities that offer the way forward.

None of this is to say that big tech and big cities should not remain major engines of innovation, nor is it to argue against innovation centres or the financing that goes into them. But it is to argue that we should cast our net wider and think about the innovation labs that exist naturally in situations of adversity around the world.

“Frugality” as Jeff Bezos points out “drives innovation” — “One of the only ways to get out of a tight box is to invent your way out.” Instead of simply recreating these conditions in innovation hubs, we should look to and help solve for the real life circumstances of people who are actually in a “tight box.”

That way we might invent products that people actually need as opposed to “140 characters”. The quid pro quo must be that the communities & individuals innovating actually benefit from having their ideas adopted, through improved services, opportunities and investment.

If you liked this read How Africa can Inspire the Future of the Sharing Economy

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