Make money, do good

Can capitalism succeed where development fails? Absolutely, says Ahmad Ashkar, founder and CEO of the Hult Prize, a $1m competition that challenges young people to develop companies able to solve critical global issues

The humanitarian industry excels at relief and disaster work. I don’t know any businesses that can deploy food at $0.50 a meal, per day, per refugee. But a crisis needs long-term solutions. To use a medical analogy, a paramedic stabilises a patient in an emergency, but doesn’t take the place of a hospital. The aid industry isn’t designed for sustainable solutions. There’s a vacuum, and business and entrepreneurial capital have a role to play in filling it.

The idea behind the earliest version of social enterprise was this: if you want to solve humanity’s challenges, you need to do it through business. I see it differently. I think the future of business lies in solving social issues around the world, and companies that fail to integrate those two issues will lose out.

If you want to create a billion-dollar company, find a trillion-dollar problem to fix, because the businesses of tomorrow will be built on both humanitarianism and capitalism.

"That was the idea behind what eventually became the Hult Prize: how can we inspire a generation to change the world through business?"I had the idea for the Hult Prize in 2009. I’d signed up for an MBA in the fallout from the financial crisis, and I was a few weeks in when I stumbled across a lecture on social business: the idea of servicing the poor through for-good companies. My ‘a-ha’ moment came when I realised: ‘why stop at sustainability? What if helping the poor can actually be profitable?’

I began wondering how I could create a platform to bring bankers, hedge-fund managers, engineers – capitalists, basically – into the giving space. That was the idea behind what eventually became the Hult Prize: how can we inspire a generation to change the world through business?

We began as a consulting business that leveraged this way of thinking: solving tough social challenges by for-profit enterprise. But within a year I had a call from Bertil Hult, the billionaire and benefactor, asking me to fly to Switzerland and talk him through my vision. Three days later, I left with a cheque in my pocket and a deal to rebrand the company. Today, the Hult Prize is on campuses in more than 90 countries, with Jordan, Lebanon and Palestine among our biggest programmes.

The Middle East is just starting to think beyond charity. There are moves towards making awqaf [Islamic endowments] sustainable, or using zakat to support impact investment. The lines are blurring between charity and business, and I encourage that, because it takes us a step closer to a future where doing good and doing well are one and the same.

Youth unemployment is a critical issue. Arab economies have a shortage of 80 million jobs, and the consequences of not taking action today will be disastrous for the region’s future. Half of jobs are created by small businesses, but just throwing money at the situation won’t create a robust entrepreneurial ecosystem. Three things are needed for it to grow, and the first is policy innovation – that means creating a risk-free environment for startups, including a way to manage failing companies.

The second element is pipeline: we don’t have enough viable companies in the region. Without that, you can’t generate the third element, which is success stories. You can create all the startup accelerators that you want, but if youth aren’t inspired to become entrepreneurs then you won’t fill them. After inspiration comes funding and scale, but success stories are what keep the wheel turning.

My advice to Arab youth is to never be afraid to dream big. This region was the centre for some of the greatest innovations and industrial revolutions in history. We were leaders, innovators, astrophysicists and inventors. So think big. My second piece of advice, is don’t be afraid to be the second hire. Number twos build companies, and are just as important. You don’t have to be a founder.

"We can’t break poverty by giving the poor access to clean water and energy. We need to focus on income generation"I believe we are on the brink of a shift in global influence. In the coming years we’ll see trillions of dollars passing to millennials from their parents and grandparents. Studies show that seven out of 10 millennials favour brands and companies that have social impact so, for the first time, we’ll have people who value more than just the bottom line making investment decisions.

As they take on leadership roles, millennials will also be controlling how money is spent within the supply chain and how businesses are built. In this model, there will be no divide between profit and social cause. The more capitalist you are, the more good you are doing.

A few years ago, I was in Mumbai, and I had a revelation: we can’t break poverty by giving the poor access to clean water and energy. With that approach, they’re still poor. We need to focus on income generation. We need to think bigger and bolder than social enterprise, and look at businesses that will reshape the way people behave and live.

Because of this, the Hult Prize is evolving. From this year, it will become the UN Hult Prize, and our challenges will be co-issued by the United Nations each year. We’ll be fully aligned with the Sustainable Development Goals, and our focus will be changing. The Hult Prize has led a generation to think about how to create businesses that serve humanity. The next decade will be spent on building the world’s largest pipeline of transformational businesses.

I want to help persuade young people that business can not only be used for capital and social good, but to solve important geopolitical issues. I’m excited to take this forward.