Stanford business professor Jim Patell believes that only by knowing your customers can you sell to them, or hope to help them, which is why he asks his students to spend spring break in a third world country doing hands-on market research, like hauling water barefoot through rice fields alongside an indigenous worker. The target customers a student is assigned to understand are people who need help and who are typically considered charity recipients, not paying clientele (such as impoverished farmers). “The idea,” writes Vince Beiser in Miller-McCune (May-June 2011), “is to harness capitalism to solve the problems of the world’s poorest.”
Patell’s course, Entrepreneurial Design for Extreme Affordability, eschews the altruistic projects and gadgetry that plague poor populations and leave people grumbling about the efficacy of charity. For example, the solar-powered ovens distributed by the Peace Corps that didn’t work for farmers who are up before dawn and come home after dark or who lived in regions with months-long rainy seasons. (Ultimately, most of them were used as planters.) Instead of donating limited-use products to people who don’t need them in the first place, Patell aims to sell something better and easier to use.
To some, structuring a course around profiting from the impoverished is a morally suspect endeavor. But Patell argues that competition for profit gives entrepreneurs an incentive to figure out what customers want and need and to make something that truly works. “That means treating them as equals,” he says. “Charities don’t have to do that.”
Not many of the products conceived in Patell’s course make it past the prototype stage, both because they need to be functional and cheap enough to sell to a customer base that earns two dollars a day and because distribution to remote villages is difficult.
Still, Patell’s course has some inspiring success stories. One Stanford grad sold 250,000 solar-powered lanterns she conceived for Burmese shopkeepers. Another class project, high-efficiency foot-operated irrigation pumps, has resulted in tens of thousands of sales.
The enigmatic Patell “brushes aside questions suggesting that he might have an altruistic motive,” Beiser writes. “Nonetheless, it’s clear that he’s deeply, personally invested in the course.”