Startups in “Third World Countries” - can they be successful?
Economic growth is essential in the combat of battling poverty and hunger in countries on the UN´s list of least developed nations. Therefore, the government encourages these countries to expand their private sectors. Is this something YOU are capable of?
Is “Third World” Politically Correct?
First, let's begin with the name. Understand we have been referring to the name all wrong! The term “third world” originated during the Cold War in the 1950s to categorize countries that remained a part of the non-aligned countries with the Communist Bloc or North Atlantic Treaty Organization. This means the nations were systematized economically and politically into three groups.
The first world was represented by the United States, Canada, Japan, South Korea, Western European Nations and their allies. The second world was represented by the Soviet Union, China, Cuba and their allies. Lastly, the third world made up everything else; it was represented by many countries in Africa, Latin America, Oceania, and Asia.
So, when referring to world poverty, you should refer them as “developing nations”. It is politically incorrect to use terms such as “third world countries”.
Can startups be successful in poor countries?
A large number of workers in these poor countries are self-employed in low-paying work activities that keep these workers in poverty. We often associate Third World Countries as a place that heavily relies on support.
We offer to give - unrivaled skills, the best technology, and experienced knowledge. And there is no doubt, that they so desperately need our help. Yet, if you told a bank manager working in a developed country that you know of an establishment that consistently achieved 96% repayment of business start-up capital, their eyes would probably start to water with envy.
The truth is that with all of our experience, technology, and competence, most business start-ups will fail within the first five years in the western world. According to BusinessBall, Dunn & Bradstreet, for example, believe that 90% of all small business failures can be put down to poor management, lack of planning, and undercapitalization. Others, highlight poor location, over/investment in fixed assets, and lack of experience.
Conclusion 1: So, to answer the question: can startups be successful in poor countries? YES. It is possible. While many would rather avoid investing in the UN´s list of least developed nations believing that their investments are not secure, smart investors are well aware of the huge potential for investments in these developing countries. Most of these countries are consecrated with many natural resources. According to MyTopBusinessIdeas, the top five ideas for a small innovative business in these countries are an alternative source of energy, alternative sources of fuel, fuel savers, importation and exportation, and processed and packaged foods business.
Conclusion 2: The meaning of success (at least for us) is not only about getting even, or related to de J curve, but also with the capacity of changing your environment and the impact your project has on society. In countries with lots of corruption or low infrastructure, lots of entrepreneurs had not only improved society’s quality of life, also create big amounts of money.
Conclusion 3: any country which forces people to find their own way through life, study by themselves or solve tons of problems a day in order to survive, either kills you or make you much stronger and creative. When we talk about IT professionals, you’ll find amazingly skilled engineers offering their capacity and experience for quite competitive costs. This remote working relation must always take in count payment related to dignity and a good quality of life.
Let us know your thoughts in the comment section below! Tell us what YOU think! Chao!