Heads up: developing countries are reinventing the world
I had the pleasure of speaking at this year’s Cannes Lions Health together with Yaniv Gelnik, Global Business Development Lead at Zipline. Here’s a summary of our talk.
Over the past few decades, the flow of innovation has started in countries like the USA and flowed slowly to the developing world — neatly demonstrated by the fact that the iPhone launched in Silicon Valley in 2007, then in Uganda in 2009. Would it surprise you to learn that, in recent years, this flow of innovation has started to reverse…?
In case you need convincing, here are just three examples:
- Deaf citizens in Botswana struggled to afford hearing aids because the batteries needed to be replaced every week or two. An organisation in Botswana saw a need and invented the world’s first solar-powered hearing aid, which can last 12 years and sells at 20% of the price of the standard option. This innovative solution is very much more affordable, great for the environment and life-changing for the deaf community in Botswana.
- The UN sought a way to more accurately track that their funds were reaching the right people in Syrian camps in Jordan. They now use blockchain technology to scan refugees’ eyes as they check in and out of supermarkets, reducing fraud and cutting 98% of transaction costs. More than 100,000 refugees are using blockchain and biometric technology, which is astonishing.
- Sick people in rural parts of Rwanda were hard to reach, so the country built the world’s first drone logistics service to transport life-saving blood and medicines. They can now deliver to any part of Rwanda within 30 minutes.
During our talk at Cannes Health, my co-speaker Yaniv Gelnik gave further insight into Rwanda’s drone logistics service — the first and only of its kind. Yaniv is Business Development Lead at Zipline, the company that built the drone logistics service. Zipline’s activities in Rwanda over the past three years have saved thousands and lives and millions of dollars. Rwanda is the first country on earth to have achieved “perfect logistics”: zero stock-outs, zero expiries. The work has improved primary care, reduced referrals and eliminated emergency road deliveries. They also recruit and train local workers into well-paid, skilled technical jobs.
Why is the flow of innovation changing direction?
Well, it’s a complex subject but it can be distilled into six key factors:
1. Less legacy technology
Emerging markets often start from a blank sheet of paper, which is hard, but it does mean they’re liberated from the kind of legacy systems that can hamstring radical progress in more developed countries. That’s how the refugee camps in Jordan skipped cash, credit cards, and even mobile money, and leapfrogged straight to blockchain and biometric scanning for their financial system.
2. Less regulation
Governments in developing countries are eager for greater innovations in their countries, so they allow more flexibility in regulations. This means their countries can become innovation sandboxes for new business to flourish.
3. Declining technology costs
It’s come to a point when it’s more affordable for Rwanda to build their drone airport than roads. The drop in some cases has been remarkable, as shown by the cost of genome sequencing (a complex process to understand DNA), which has fallen from US$10m in 2003 to just US$5,000 today.
4. Strong local talent
We’re starting to see a growing middle class population in developing countries. This means that parents have higher expectations for the quality of education their children receive, which is driving up the supply of good schools. Also, with improving access to the internet, young people are able to attain new knowledge and learn regardless of which income bracket they fall into.
5. Rising aspirations
Millennials in emerging markets are their most affluent generation yet, having grown up with rapid economic growth and exposure to the wider world’s brands and cultures. This means that the lives of millennials in developing and developed countries are getting more and more similar. If you look at the apps, trends, and aspirations of a millennial in Lagos, Nigeria and that of a millennial in London, United Kingdom, they will likely be quite similar.
6. Greater need
It may sound simplistic, but it’s amazing what you can achieve when the need is critical. For example, over 60% of the population in Rwanda still live on less than $1.25 per day. Rather than deciding on whether to exit the EU, these countries are debating how to feed their countries. This is a very different type of motivation.
Our takeaway from this should be to ask ourselves one big question: are we marketing to emerging markets or with them? It’s no longer about repackaging a single product created for the developed world and launching it in developing countries. Developing countries now have a talented workforce with the aspirations to get their country out of poverty, and are not hampered by regulation, technology costs, or legacy systems. Zipline is an example of how partnering with a developing country allowed them to be faster than Amazon Prime Air and US military to launch a new drone innovation to save lives.
If your business is serious about being at the cutting edge of innovation, it’s time to consider partnering with developing countries and innovating with them.
