How Private-Sector Innovation Can Help Those Most In Need
from the profit-can-be-good dept
Facebook Co-Founder and CEO Mark Zuckerberg's decision to dedicate 99 percent of his Facebook stock towards improving the world was met with strong praise this holiday season. The resources will be used to promote programs related to "personalized learning, curing disease, connecting people and building strong communities."Everyone's talking about "why" this donation is important: namely, helping future generations live in a better world than we live in now. But fewer people are focusing on "how." The Facebook proceeds will be channeled through the Chan Zuckerberg Initiative, LLC – a for-profit company with philanthropic ambitions.
As a business rather than a non-profit, the Initiative will have more freedom to put the power of private sector innovation to work in the non-profit world, such as making private investments, and promoting public policy issues. This is not the first time social good was driven by private sector innovation. Digital platforms like Facebook, Twitter and Instagram are changing how we interact, driving fundraising and donations for large charitable projects, and enabling us to coordinate efforts and produce social change. We saw these macro effects throughout the Arab Spring, in places as distant as Tunisia and Egypt.
The innovation cycle is also impacting forward progress on the micro level, whether it's a solar-powered well that's being installed in a small, rural, mountainous community in Chile, a mobile phone in Africa that helps rural farmers know what prices they should expect for their goods at market or the anytime/anywhere connectivity that can keep a fisherman safe from storms he wouldn't have been aware of otherwise. What's born in a lab in Silicon Valley can have a life-altering impact on people half the world away in the Jordan Valley.
That could help explain why multibillionaire Google co-founder Larry Page has said he wants to leave his fortune to Elon Musk, the forward-thinking innovator and CEO of Tesla Motors and SpaceX. Leaving his billions to Musk would presumably ensure that research into "moonshot" projects akin to those of Google's new parent company Alphabet – robots, nanoparticles, self-driving cars, wind-energy-capturing kites, balloon-based WiFi and more – would continue after he's gone.
Musk is redefining the parameters of innovation. With Tesla, he's changing the whole structure of the car, which allows us to do other things in the car besides focus on the road. And by redesigning the car's power supply, he's changing the physical layout of the car, too – where we sit, where we store luggage. Musk refuses to allow the status quo to dictate the trajectory of tomorrow's innovation.
Yes, Musk is making $100,000 cars that may seem worlds away from the extreme poverty that pocket the earth, but innovation doesn't exist in a silo. Innovation permeates every facet of our life. In chaos theory, Edward Lorenz's "butterfly effect" describes how a small change in one state of a deterministic nonlinear system can produce very different outcomes in later states of that system. Musk and countless other private-sector innovators, are today introducing massive change into our world which in turn are powering and empowering massive change in the world that lays before us and before the billions of underserved among us.
The tangible examples of innovation's near-universal influence are numerous. Mobile payments aren't just for paying rent in Washington, D.C., or splitting lunch in San Francisco. They grow economic development in remote parts of the world by accelerating transactions, and improve safety by reducing the need to travel with large sums of money in dangerous locals. Booz Allen Hamilton estimates digitization of emerging markets could drive respective economic growth by $4.1 trillion dollars among the most underserved 3.9 billion consumers. The UN recently endorsed goals to eradicate extreme poverty over the next 15 years. Connecting the last billion people to the Internet will help end marginalization through banking, identification and the broad dissemination of information.
Our reliance on technological innovation for social change may be more important now than ever. Philanthropic giving has yet to rebound to pre-Great Recession levels, even as community needs expand, according to a report from the National Council of Nonprofits. This makes it hard for non-profits to keep up with demand, or upgrade and invest in their own technology and capabilities.
While there's certainly a continued need and role for charity, innovations and technologies are lifting one person at a time, and in the aggregate, they're lifting entire nations to a higher plane. Innovation isn't helping just the most desolate among us; it's improving the quality of life for all of us.
What may look on the surface like another business transaction – just another company out for profit – has the potential to do tremendous good. The great promise of innovation encompasses not only the predetermined outcomes or reasons for investment, but also all of the opportunity that is unleashed as a result of those investments and decisions.
Shawn DuBravac is chief economist of the Consumer Electronics Association and the author of "Digital Destiny: How the New Age of Data Will Transform the Way We Live, Work, and Communicate." Follow him on Twitter @shawndubravac.
Filed Under: charity, doing good, elon musk, innovation, larry page, private sector
