Innovation is the heartbeat of civilisation. With each advancement, the development of mankind is fuelled, and cultural and economic change stimulated.
Some 6,000 years ago, the use of the wheel became widespread and thus the ability to transport large loads of anything over great distances – thanks to the wheel, farmers were able to sell their produce in markets several miles away creating greater prosperity from the opportunity to service wider distribution.
In 1440, the single printing press invented by Johannes Gutenberg was able to print as many as 3,600 pages per day; by 1500 over 1,000 Gutenberg presses were operating in Europe and by 1600 over 200 million new books had been printed. The impact of this innovation was that books became affordable for lower classes and helped spark the Age of Enlightenment, facilitating the spread of new and often controversial ideas. Printing also had a widespread and dramatic impact on culture, the economy, and entrepreneurship; scientists were also more easily able to share their discoveries. Mark Twain was to comment, “What the world is today, good and bad, it owes to Gutenberg.”
Inventions such as the magnetic compass ignited the Age of Discovery and fuelled the Industrial Revolution and also enabled interaction (friendly and hostile) between previously isolated world cultures. The invention of paper money, widely used in China in the 9th century, appeared in Europe in the late 1600s; it changed the face of global economics and paved the way, centuries later for credit cards and electronic banking. In 1879 and 1880, Edison and Swan patented the first long-lasting light bulbs – this innovation was to free society from an almost total reliance on daylight and paved the way for domestic electrical wiring. Throughout the 1850s, telegraph lines multiplied and, by 1902, transoceanic cables encircled the globe – these lines were the bedrock of the information age. The technology for the transistor (first developed in 1947 by Bell Laboratories) was the precursor to the technology used in televisions, cell phones and computers.
These are just a few of the great innovations that have given us the world we live in today and have driven knowledge and prosperity around the globe.
We would, however, argue that it was the 1989 invention of the World Wide Web – an interconnected system of computer networks – by Sir Tim Berners-Lee that is one of the greatest innovations of all time and one that has had one of the most immediate, global impacts. It is, we believe, the greatest leveller of the playing field that has ever existed, delivering access for all to valuable (and usually free) information. Whilst initiatives such as YouTube, Google and Facebook have had a great impact on culture, it is the access to education that we think will lead to the most dramatic change, in particular in the emerging markets.
For the first time in human history, the youth of today can access, acquire, process and control more information than ever before. To quote Bill Gates:
“The information highway is going to break down boundaries and may promote a world culture, or at least a sharing of activities and values. The highway will also make it easy for patriots, even expatriates, deeply involved in their own ethnic communities to reach out to other with similar interests no matter where they may be located. This may strengthen cultural diversity and counter the tendency toward a single world culture.”
Emerging markets are home to 90% of the world’s under 30s and in India, for example, just over half the population is below the age of 25 – the perfect environment for spectacular things to happen.
Through technology, virtuality has become more real than reality to many young people. There is now a wealth of potential talent that has the tools and the opportunity to become pioneers of the future. In addition, the convergence of technologies such as radio, TV and the internet, the development of wireless devices and the shift to an information and service-based economy all present the perfect foundation for young entrepreneurs in emerging markets.
I am not alone in my thinking about the future success of emerging markets – a Euro monitor International report predicts that ‘emerging market economies will grow almost three times faster than developed ones, accounting for an average of 65% of global economic growth through 2020.’
Global economic growth will be massively influenced by the progress made in emerging markets and we believe that this will be driven by the under 30s.
It is the youth market in emerging markets where we believe that this access to information will have the greatest impact. For instance, India has the largest population of university-age students in the world, estimated at 94 million and growing; however, the country has one of the world’s lowest higher-education enrolment ratios with only around 17 million students in higher education. This presents a huge opportunity.
There are also significant socio-economic changes occurring which present a huge opportunity. According to EY, in Asia alone, 525 million people can already count themselves middle class – more than the European Union’s total population…
Over the next two decades, the middle class is expected to expand by another three billion, coming almost exclusively from the emerging world.
This means that companies used to serving the middle-income brackets of the old Western democracies need to find ways on how they will supply the new bourgeois of Africa, Asia and beyond – it is quite possible that this opportunity will be seized by those actually operating in those emerging markets who have the cultural background and will see things through the fresh perspective of youth – after all, no great innovation ever came out of a major institution; every great innovation started with one great idea and that was from an individual not a committee.
To seize this huge opportunity, access to capital for those operating in emerging markets is key. In addition to securing backing from sources such as venture capitalists, young entrepreneurs are also accessing capital through initiatives such as crowdfunding. One example is of an entrepreneur in Beijing who used a crowdfunding platform to develop a portable device that measures air quality in the city.
It is true that to date, the majority of entrepreneurs who have maximised the opportunities from the technological revolution (Facebook, Twitter, Google, LinkedIn, WhatsApp, YouTube, Snapchat and Instagram) have come from the developed world; they do, however, share common themes – youth (average age 23), innovation and the ability to deliver simple solutions to complex communications issues.
It is our firm belief that the pioneers of future are to be found in the youth of today, and that much of this talent is to be found in emerging markets. Those who embrace this talent will benefit from the extraordinary ideas that modern technology now enables to emerge from these previously unploughed fields of intellectual property.
Kohli Ventures is committed to being at the forefront of this by embracing the talent that exists in emerging markets and supporting it with intellectual and financial capital. If you are an entrepreneur with a sparkling innovation that would benefit from access to capital, and a global network of expertise and experience, the team at Kohli Ventures would love to hear from you.