How Entrepreneurs Can Help Developing Countries Hard Hit by Climate Change
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Discussions around climate change solutions regained steam last November when a federal report indicated the negative impacts on public safety and the economy are now being felt across the United States. Even if governments are able to implement policies that reduce carbon emissions and mitigate this trend over the long term, countries must build resilience now for increasingly extreme weather events, shifting energy demands and new challenges for industries like insurance, tourism and agriculture.
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In terms of both economic losses and human casualties, climate change affects developing countries most acutely because they lack the infrastructure and resources that help richer countries endure. Consider, for instance, that from 1997 to 2016, extreme weather events like flash floods killed more than half a million people, and of the 10 countries hit hardest, nine were in the developing world. Technologies like radar, satellites and weather stations are expensive to implement, so large swaths of the world still lack access to modern weather data. The result is that the world’s most weather-sensitive communities also have the lowest quality weather information, a disparity which climate change will only exacerbate.
There are entrepreneurs who approach this disparity not merely as a humanitarian imperative but as a challenge that demands innovative, market-driven solutions which are sustainable and scalable. For examples of how high-impact startups can help developing countries build climate resilience, let’s look at public safety and agriculture.
Since launching in 2015, the “microweather” venture ClimaCell has raised $70 million in funding and attracted major customers from industries dependent on minute-to-minute forecasting like air travel, professional sports and construction. Recently, the company announced a 40-country rollout that includes India, where the company plans to, among other things, revolutionize the country’s early warning system for floods.
The three founders of ClimaCell -- Shimon Elkabetz, Itai Zlotnik and Rei Goffer -- learned the critical limitations of traditional forecasting while serving in the Israeli military. Afterward, they explored ways to extract data from untapped sources. According to Goffer, “We developed a technology that could ‘see’ all sorts of weather phenomena by analyzing subtle changes in cellular and satellite signals.” They found they could significantly improve forecasting capabilities by integrating traditional radar and satellite data with their own, but also surmised their tech would make the greatest impact in developing countries, where weather infrastructure was minimal but wireless networks were widespread. Supported by Legatum Center fellowships, both Goffer and Zlotnik attended MIT Sloan School of Management to explore emerging market applications.
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ClimaCell chose India as their beachhead into the developing world, a country which has lagged decades behind developed countries in terms of weather data and, partly as a result, has historically accounted for one-fifth of flooding deaths in the world. Floods this summer killed more than 400 people in Karachi alone. By partnering with some of India’s largest companies, ClimaCell turned their networks into millions of virtual sensors, bringing granular weather data to solutions ranging from mobility to agriculture -- and of course, to public safety. According to ClimaCell’s Chief Scientist Daniel Rothenberg, “By using these virtual sensors to more finely capture real-time changes in precipitation, we can greatly enhance communities’ resilience to extreme weather from floods and beyond.”
Now let’s look at agriculture, which provides livelihoods for 40 percent of the world’s population and is the largest source of income and jobs for poor rural households. As climate change leads to increasingly unpredictable weather, smallholders find they can no longer rely on farming practices based on generations of experience.
Aukrit Unahalekhaka, another Legatum Center Fellow and MIT Sloan alum, grew up in an agricultural family in Thailand and knew the challenges smallholders faced. Unahalekhaka co-founded Ricult, a mobile-based platform that empowers smallholders with access to affordable capital, market alerts, direct access to produce buyers and cutting-edge farming techniques -- a service suite that has boosted farmers’ profits by 30-40 percent. Ricult currently works with 10,000 smallholders in both Thailand and Pakistan and aims to reach 100,000 by year’s end.
More recently, Ricult added hyperlocal weather forecasts to their platform, leading to a significant increase in productivity. “Our pilot results have made us eager to partner with a weather specialist,” Unahalekhaka said. For instance, when ClimaCell’s reach expands to Thailand in the coming months, integration of their data could greatly enhance forecasts for Ricult’s farmers, particularly those who remain largely out of radar’s reach, and help them make critical decisions about the optimal times to sow, fertilize and harvest. Ricult can also use the weather data to more accurately predict yields, information they can share with banks to help farmers secure better loans.
A comprehensive response to climate change demands bold entrepreneurial solutions, particularly in areas with limited infrastructure. We need innovative startups that not only mitigate climate change but also help to build climate resilience. We also need to foster emerging market ecosystems that cultivate such ventures. Finally, we need all stakeholders, from governments and NGOs to nonprofits, corporates and universities to play a bigger role in supporting those ecosystems. We can see those supports beginning to take shape. In 2012, for instance, the World Bank Group funded a Climate Innovation Center (CIC) in Kenya to support innovative businesses addressing climate challenges. Kenya CIC companies have since generated more than 2,400 jobs and $15 million in revenue, paving the way for CICs in seven other developing countries.
Meanwhile, here in the U.S., top business schools are reshaping their programs to approach emerging economies as robust entrepreneurial opportunities, where students can innovate, launch and scale market-driven solutions to an array of seemingly intractable challenges. Indeed, business schools should be approaching climate change the same way.