OPEN Forum Attracts 600 Pakistani Entrepreneurs in Silicon Valley
This post is based on partial coverage of the event. For more details, please view the conference video recordings on facebook available via Vpype, a startup founder by Pakistani-American entrepreneur Shoieb Younus.
The conference was opened by Naeem Zafar, President of OPEN Silicon Valley, who briefly described the conference agenda and the organization's objectives and its various events and activities for the audience. It was followed by a morning keynote featuring Faysal Sohail who manages energy, materials and IT portfolios for CMEA Capital with over a billion dollars in venture investments.
Keynote speaker Faysal Sohail described the last decade of 2000-2009 as "zero decade" in terms of returns for the US venture capital industry. He then went on to explain the massive impact of small start-ups as the employment engine of the nation's economy, citing Kauffman Foundation's data that virtually all of the net new jobs from 1980 to 2005 were created by companies less than 5 years old.
Faysal sounded an optimistic note about opportunities for innovation and entrepreneurship that lie ahead for his audience at OPEN Forum 2010. Emphasizing the fact that the United States remains #1 in innovation, he picked energy, healthcare and information technology sectors for tremendous opportunities for researchers and entrepreneurs.
In energy sector, Faysal said that the nearly 2 billion people in Asia coming out of poverty will need energy to drive their productivity. He specifically mentioned the areas of energy production (solar, wind, bio fuels), energy storage (grid scale storage) and efficiency (LEDs, Sensors).
In healthcare, Faysal mentioned new drugs (cancer, diabetes, pain management) and new devices (hearing aids, optical, surgical equipment).
In information technology, he brought up web 2.x (social web, mobile), strategic outsourcing (tech platform, outsourcing), and software as service (enterprise solutions).
In closing, Faysal declared that "the best is yet to come", and the opportunities for entrepreneurship are vast with large global markets and capital-efficient startups relying on outsourcing of infrastructure and tools.
Social Entrepreneurs Panel:
Moderated by Saad Khan, a partner at CMEA Capital, this panel featured Salman Khan of Khan Academy, Leila Janah of Samasource, Tabreez Verjee of Kiva, and Misbah Naqvi of Acumen Fund.
The panelists described what they do as social entrepreneurs and what led them to it. Salman Khan started at a hedge fund before he was inspired by a cousin and her friends to create Khan Academy for tutoring math and science via his Youtube channel.
Leila Janah of Samasource went to work for the World Bank in Washington to fight poverty, but she was soon soured by the bank bureaucracy whose focus was on self-interest rather than the interest of the world's poor which it is supposed to serve. Her first day at the World Bank was spent at a seminar advising bank employees on financing a second home. She quit her job to found Samasource, which is a non-profit service that seeks contracts from companies in the West, and slices large contracts into microwork tasks like data entry, software testing, transcription and research outsourced to the poor, but educated, workers abroad.
Tabreez Verjee serves on the board of Kiva, a Silicon valley startup that combines microfinance with the Internet to create a global community of people connected through lending. The company allows lenders to lend amounts as small as $25 and choose who to lend to via the Internet. The funds are disbursed to small entrepreneurs and loans repaid using existing microfiance companies operating in different parts of the world. Kiva is working with Asasah microfinance in Pakistan.
Misabah Naqvi is the business development manager of Acumen fund which invests in social enterprises. She was originally a banker in Pakistan before joining the Acumen Fund. The fund is a business rather than a charity, and puts all of its returns back into the fund to support more social efforts based on sustainability, scale and social impact. In addition to investing in microfinance, the Acumen fund has invested in Saiban which is building low-cost housing in Pakistan.
Reasons to Believe in Pakistan:
Mir Ibrahim Rahman, the young CEO of Pakistan's private TV channel Geo TV, previewed his planned media campaign "Reason to Believe" or RTB in Pakistan. It is designed to offer "reason to believe" to build a solid foundation for progress. Mir articulated a whole series of reasons to believe in Pakistan's future ranging from its young population, its vast energy resources in form of coal deposits, its great potential as a food basket, and its long coastline, to its strategic location in terms of world trade in energy, goods and services.
He said Pakistan's acquisition of nuclear assets required a great deal of hard work and tenacity, great qualities that can also be put to use in developing Pakistan's industrial and technology sectors. Mir said Pakistanis should celebrate their dual heritage from the great Indus civilization and their Islamic ancestors in Baghdad.
He lauded the role of Pakistani expatriates in funding Pakistan to the tune of $10 billion a year, and suggested there was a lot of room for growth in investments from overseas Pakistanis.
He expressed optimism that the birth pangs of democracy will start to pay dividends in Pakistan in the near future. He pointed to the successful passage of the 18th amendment, the consensus on the NFC award for allocation of federal funds to various provinces, and the assertive judiciary as good signs for the nation.
Electric Vehicles Panel:
The panel included Richard Lowenthal, Founder and CEO of Coulomb Technologies and Maurice Gunderson, senior partner at CMEA Capital. It was moderated by Faysal Sohail, MD of CMEA.
Lowenthal, who said he drives BMW's MINI-E all-electric car, outlined the benefits of electric vehicles in terms of "no tail-pipe" and low cost of "2 cents a mile". He was immediately challenged by Gunderson on both counts, and responded as follows:
1. The 2 cents a mile cost does not reflect the true cost of electricity generated by burning coal. A lot of the cost of coal-burning is externalized by power companies in terms of the dead and sick coal miners and environmental pollution and other costs to society.
2. The little tail-pipes in cars are simply replaced by huge smokestacks at coal-burning power plants.
3. Policy drives economics; Economics does not drive policy. Putting price on carbon by taxing CO2 emissions can fundamentally alter the cost calculations to make renewables more competitive.
Both panelists agreed that there is a need for a comprehensive energy policy that reflects the true costs of various fuels for optimal mix of energy sources in the United States. Electric cars make sense if they result in overall environmental improvements at reasonable costs. In addition to solar, wind and biofuels options, Gunderson argued for more nuclear power as well.
Assuming that the earth is a hollow sphere filled with oil, Gunderson said he did a calculation back in the 1970s on how long the oil would last at the rate of increase in the 1970s. He concluded that the oil would last 86 years. Although the rate of increase in oil consumption has declined since the 1970s because of significant improvements in the internal combustion engine efficiency, the fact remains that the earth is not a hollow sphere filled with oil. Eventually, the oil and other fossil fuels will run out, and new energy sources will be needed to sustain reasonable standards of living.
Lowenthal discussed the key issues in electric vehicles adoption ranging from the size and capacities of new batteries to the frequency and duration of charging and the need for recharge infrastructure for it. Silicon Valley's Tesla Motors is solving the problem by putting in a very large battery pack to have a range of 300 miles. Shai Agassi's Better Place in Israel is pushing battery swap-out stations along the highways.
Birds of Feather Sessions:
There were a number of BoF sessions at the conference. Three such sessions were offered to alumni from NED University in Karachi, University of Engineering and Technology (UET) Lahore and Ghulam Ishaq Khan (GIK) Institute in Topi, KPK. Among these, I attended the NED BoF which attracted about 40 NEDians, more than the other two. Several NEDians could not attend because they were speakers or panelists at other session that conflicted in time with the NEDians BoF.
The keynote speaker was Iqbal Quader, the founder of Grameephone in Bangladesh and currently the head of MIT's Legatum Center in Cambridge, Massachusetts. He shared the story of how he persuaded Dr. Muhammad Younus of Grameen Bank to invest in Grameenphone. He used the analogy of Grameen's cow loans to poor villagers in Bangladesh to describe how the mobile phone could be a thought of as a cow that produces revenue by enabling people in remote villages to communicate with others to stay connected and improve productivity. The revenue from the phone calls would enable better livelihood for small entrepreneurs and help repay the loans to expand access and empower villagers. Younus was persuaded, and the rest is history.
Quader believes that the proliferation of mobile phones offered by private telecom companies as a communication tool has empowered Bangladeshi people to improve their lives in many ways...something that was unimaginable under the government owned phone monopoly which concentrated power with 67% of the phones in the capital city of Dhaka. The proliferation of cell phones means devolution of power to the people, and it has far reaching positive impact for society at large in developing nations. The dramatic improvements in ordinary people's ability to communicate, organize and do business anytime, anywhere will have positive results in terms of economics and politics of the nations experiencing the mobile communications revolution.
I think OPEN Forum 2010 was well worth the time and the energy that was put into it by the organizers and the attendees alike. I believe the conference clearly succeeded in its immediate objective of bringing aspiring entrepreneurs of Pakistani origin together with many investors and mentors in Silicon Valley, informing the audience and stimulating discussion of new ideas and opportunities, and educating the speakers and the attendees. But its real impact won't be apparent until there is a significant critical mass with many more successful Pakistani entrepreneurs inspired by what they saw and heard at OPEN Forum 2010.
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