Richard Branson's Latest Venture

The Entrepreneur: Sir Richard Branson, 57

Background: At 16, British-born Branson launched his first business: a magazine called Student. He then established a mail-order record business that turned into a chain of music shops and eventually became the Virgin Megastores.

The Company: Since his first venture, Branson's Virgin Group has grown to include some 200 companies, including airlines and mobile phones, with an estimated $20 billion in revenue. On Aug. 8, Branson plans to launch Virgin America, a stateside domestic air service.

Making a Difference: The very essence of an entrepreneur; competitive, flamboyant, and always ready to take a risk, Branson was knighted by Queen Elizabeth II of England in 1999 for his "services to entrepreneurship." Now he is hoping to help spearhead a movement to use entrepreneurship to alleviate a number of global problems.

Last week, business leaders celebrated record highs on Wall Street, with the Dow Jones industrial average rising nearly 300 points (see BusinessWeek.com, 7/20/07, "Dow 14,000"). While consumption and profits are growing, far less enviable statistics are also escalating: A staggering half the planet lives on less than $2 per day. Some one billion people lack access to clean water. In Africa alone, 40 billion working hours are lost each year to time spent carrying water long distances. A quarter of a billion people live in overcrowded urban squatter settlements without adequate shelter. And, tragically, 16,000 people die every day from preventable, treatable diseases like AIDS, TB, and malaria.

Every time I travel to Africa, I am impressed by the tremendous entrepreneurial spirit of its people. But I am also saddened by the destructiveness of poverty and health crises like AIDS. It's not unusual in a place like South Africa to see hundreds of signs for funeral services in townships and rural areas in the place of the signs for small businesses that were once a symbol of hope for a future free from poverty.

There are many efforts underway aimed at solving these global issues. But we must do more, and I believe that as entrepreneurs we have a unique role to play. Having spent the last 30 years launching businesses in everything from music to airlines, financial services to health clubs, telecommunications to commercial space travel, I'm a firm believer in the power of entrepreneurship to transform the global marketplace. As entrepreneurs, we are trained to spot possibilities where others see only obstacles and to never mind the bollocks driven by bureaucracy and red tape.

Never Mind the Theories
Entrepreneurs just tend to get on with making things happen. The same unconventional approaches that enabled icons like Steve Jobs to revolutionize personal computing, or Pierre Omidyarand Jeff Skoll to develop an ingenious online marketplace, can be leveraged to alleviate the tremendous suffering that persists in the world.
There is a debate raging about whether activities in the area of driving such change should be for profit or not for profit (see BusinessWeek.com, 7/9/07, "Microfinance Draws Mega Players"). To be honest, the issues in the world are too big to be debating about the methods of delivery—it's like fiddling about with a plug when the whole pipe just burst. It's not that black and white; we need to look at all kinds of solutions ranging from philanthropic to profit-making. The focus should be on the number of people we can give choices to in life—not on theoretical structures.

The good news is that this is beginning to happen—there is a fascinating shift bringing the public and private sectors together that has the potential to finally break the cycle of poverty and create solutions for crises such as climate change and the AIDS epidemic.

One Man's Waste…
As Nobel laureate Muhammad Yunus wisely points out, "Many of the problems in the world remain unresolved because we continue to interpret capitalism too narrowly." It's true that capitalism has traditionally concentrated vast wealth in the hands of a select few. But more and more, entrepreneurs are leveraging the power of markets to address imbalances.

Entrepreneurs can instigate change in the social sector in the same way that they do in the business world, but they must not lose the characteristics that made their businesses successful when they step into the social and environmental sectors. As I've mentioned, entrepreneurs turn problems into opportunities. But what does this mean when it comes to problems like poverty or climate change?

Consider Dhaka, Bangladesh. Its 6.5 million residents produce between 3,000 and 3,500 metric tons of solid waste daily, less than half of which is collected. The rest is literally left to rot in the streets, resulting in serious health risks and pollution. But entrepreneurs like Iftekhar Enayetullah and Maqsood Sinha see value where others see garbage. Their organization, Waste Concern, started community-based composting plants for local residents to turn household waste into high-quality fertilizer sold for a profit. This network has created jobs and meets the great demand by farmers for organic fertilizer.

Similarly, climate change can seem like an overwhelming problem, but there are opportunities here as well for business approaches to arrive at solutions. We've launched Virgin Fuels, which will invest up to $400 million in the renewable-energy and resource efficiency sectors in the U.S. and Europe to fuel expansion and growth of promising products and technologies. It's part of our commitment to using up to $3 billion of the Virgin Group's future proceeds from all transportation interests over the next 10 years to tackle global warming.

Crisis Becomes Opportunity
With the right business model, social entrepreneurs can also leap-frog barriers. Take Aravind Eye Hospital in India. Aimed at eradicating blindness, Aravind focuses on principles of high volume, low cost, and operational efficiencies such as local manufacturing of medical supplies and use of telemedicine. An Aravind doctor typically performs 2,000 surgeries a year, 10 times the national average. The model allows hospitals to provide 70% of their services free or at highly discounted rates. Over 270,000 cataract surgeries were completed in 2006. Home to nearly one-quarter of the world's blind, this five-hospital system in India turned a national crisis into a massive business opportunity.

Simple ideas go a long way. Social businesses like KickStart and the Sustainable Healthcare Foundation (SHEF) have built franchise systems to help grassroots entrepreneurs get started. In Africa, KickStart has helped create 50,000 businesses through small-scale enterprise opportunities with new technologies such as its micro-irrigation foot pump and oil press. Kenya-based SHEF has developed 64 community-owned and -operated clinics in areas where there was previously no access to health care.

One of the key characteristics of an entrepreneur is to think big—and to never accept no for an answer. This has got me, and probably you, into trouble many times in our lives, but it's also created incredible businesses around the world that have changed how we live.

Peter Gabriel and I started a journey with Nelson Mandela several years back when we felt the world was rapidly becoming a global village, yet we had no advisers who were driven by what's best for humanity rather than what's best for the military, the economy, or a political group. You can only imagine the feedback we got when we first started to try and get people on board to help us bring this dream to life—people thought we had lost our minds! But we truly believe that there must be a new way to approach global issues and a need for fresh, independent thinking.

Elders For a Global Village
In July of this year, we launched the Elders, a remarkable group of leaders to tackle the world's problems, including: Mandela, Graca Machel, Archbishop Desmond Tutu, Mary Robinson, Kofi Annan, former President Jimmy Carter, Yunus, Ela Bhatt, Li Xhaoxing, and Gro Harlem Brundtland.

We hope this group will become the elders of our global village and play a role in alleviating human suffering. As Mandela put it, "This group can speak freely and boldly, working both publicly and behind the scenes on whatever actions need to be taken. Together we will work to support courage where there is fear, foster agreement where there is conflict and inspire hope where there is despair."

Thinking big and coming up with ideas that might seem ludicrous at the start are all going to be important if we want to radically change the path the world is headed toward to make sure that we build a far healthier, more equitable and peaceful planet for our children.

Inspiration From Nora
To help the Virgin Group do our bit, Virgin Unite was started in 2004. The charitable group uses our staff and customers to works on a range of projects, including launching a new school for entrepreneurship, creating a rural transport network, setting up a small- to medium-size, business-venture fund in South Africa, and helping set up the Elders.

Thinking big doesn't mean forgetting about the smaller gems that can be scaled up. I am constantly motivated by a woman named Nora I met in South Africa on a trip with Virgin Unite. Nora has dedicated her whole life to using entrepreneurial ways to support hundreds of children in South Africa who have been orphaned by AIDS. If she can feed over 200 children every single day out of a one-room, tin shack, imagine what she could do if she had resources behind her.

As entrepreneurs, we have a wonderful opportunity and responsibility to give Nora and others like her a chance to expand their work and help make it sustainable so that everyone has the right to a life free from the shackles of poverty.

(as told to Stacy Perman)