$150 Million Gift To Stanford Puts It At Forefront Of Social Enterprise

The result of that meeting was that King provided seed funding to Baidu, which now employs more than 10,000 people in China. Another King home stay student, Andreata Muforo from Zimbabwe, who graduated with an MBA from Stanford in 2009, brought peers from her global study trip to Africa to the King home for dinner. “We heard how those first-hand experiences compelled some of the MBAs to return for internships in Africa,” said “Dottie” King. “We saw the direct connection between the learning experience and the motivation to make change.”

“We wondered, how might we do something bold and significant,” added King in an interview with The Chronicle of Philanthropy. “Something like giving light to the slums (without electricity) in Nairobi, or something to improve the health of the children born there. Something that could combat malaria or alleviate AIDS in Africa.”

King said he and his wife gave serious thought to the poverty-fighting charities they could support directly, but picked Stanford because it would give students and professors a platform to do research in other countries and then return to create solutions using university resources. “We believe that innovation and entrepreneurship are the engines of growth to lift people out of poverty,” said King.

Of the $150 million gift, $100 million will fund the Institute. The remaining $50 million will be used to match other donors who contribute still more money to fuel Stanford University’s commitment to alleviating poverty, bringing the total philanthropic investment to potentially $200 million.

The work of the institute (SIIDE, pronounced and known informally as “SEED”) will span three pursuits: research, education, and applied on-the-ground work to support entrepreneurs and help growing enterprises to scale. It will:

  • Conduct multidisciplinary research in close cooperation with in-the-field managers that is focused on new and effective ways to both increase the impact of managed organizations and develop solutions to improve governance, education, and infrastructure.
  • Educate Stanford students from around the world as well as entrepreneurs, social entrepreneurs, managers, and leaders in developing economies to enable them to relieve poverty through effective leadership and problem-solving.
  • Build capacity on the ground to support action by entrepreneurs, managers, and leaders to scale their organizations and spur innovation.

SEED will be a well-integrated series of activities, with each area of focus continuously reinforcing the others. Data collected on the ground, for example, will be used to fuel research that will shape new courses and drive new solutions to problems as diverse as transportation and supply chain logistics, health care needs, or mobile communications. Students, faculty, and alumni will work in the field to support local organizations solving real-world problems standing in the way of growth.

The school envisions that in addition to research, students will participate in a course at Stanford before undertaking a work experience in the field. The school already has pioneered this format, in collaboration with Stanford’s Hasso Plattner Institute of Design, with Entrepreneurial Design for Extreme Affordability. In collaboration with in-country organizations, such as International Development Enterprises and Proximity Designs, Stanford students have identified opportunities that sparked ventures such as d.light, a consumer products company serving people without access to reliable electricity; Embrace, a social entrepreneurship venture that brings low-cost infant warmers to premature and low-birth-weight babies in the developing world; and Driptech, a water technologies company that produces affordable, high-quality irrigation systems designed for small-plot farmers. A face-to-face and online curriculum also will be developed for in-country entrepreneurs, leaders, and managers to help scale and boost the performance of nascent or ongoing ventures.

To amplify its impact on the more than one billion people in the world who live on less than $1.25 a day, SEED will partner with organizations such as Endeavor, which mentors and accelerates the work of high-impact entrepreneurs; Omidyar Network, a philanthropic investment firm that helps scale innovative organizations that catalyze economic, social, and political change; Skoll Foundation, which drives change by investing in social entrepreneurs; and global social enterprise investor Acumen Fund. All have established operations abroad.

“Today’s students aspire to achieve a global impact that will change people’s lives for the better with everything from businesses that create employment and income sources to creating access to better education, health care, and governance,” said Stanford B-School Dean Garth Saloner. “This initiative is an enormous opportunity for Stanford students, faculty, and on-the-ground entrepreneurs to collaborate on the design and incubation of new enterprises and solutions.” Examples of such organizations include everything from microfinance lender Equity Bank in Kenya to MercadoLibre, Latin America’s leading e-commerce business, which launched with support from Endeavor and now employs some 1,500 people, to Embrace and d.light. SEED will cover a broad spectrum of organizations with emphasis on enterprises that employ people in impoverished communities or deliver products and services to those living in poverty. “There are very few settled solutions about how best to alleviate poverty in a wide range of contexts, which means there is plenty of opportunity to uncover, share, and apply new insights,” said Saloner.

The effort will be lead by Lee, a winner of the MBA Distinguished Teaching Award who recently collaborated with Riders for Health to measure and demonstrate the impact of their work transforming the Gambian and Zambian health care delivery.  Lee also will head the Institute’s research area.

Jesper Sørensen, a professor of organizational behavior, will lead the education and dissemination area. Sørensen is a faculty director of the Center for Social Innovation at the Graduate School of Business and teaches Poverty, Entrepreneurship, and Development, among other courses.

Jim Patell, a professor of public and private management at the school, with Bill Meehan, a lecturer and director emeritus of McKinsey & Co., will lead the on-the-ground area. Meehan will focus primarily on supporting existing business leaders to scale and grow their enterprises through a combination of executive education, consulting, mentoring, and online courses. Building on his years of teaching Entrepreneurial Design for Extreme Affordability, Patell, a winner of the MBA Distinguished Teaching Award, will manage programs aimed at partnering Stanford students with in-country organizations to develop new products and services. Following a period of coursework and preparation at Stanford, students will provide manpower and management support by working with startups, NGOs, and companies in-country. Students will investigate needs and execute solutions with partner entities on the ground.

Nobel laureate and former Stanford B-School Dean A. Michael Spence will chair the Institute’s advisory board, which is now forming. Spence is an authority on global economics in the developing world.

The Institute’s first research forum will be held March 5-6, 2012, at the Stanford Graduate School of Business. It will bring together faculty by invitation from across Stanford University and elsewhere to share and jointly explore research opportunities in developing economies.

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