EXPERIENCE
HBR.ORG
A Bold Idea
Unamano had been a
pretty big idea for a shy,
studious girl whose
Case Study
Stretch the
Mission?
A nonprofit that supports emerging-market entrepreneurs considers
expanding to the U.S. by William A. Sahlman and Ramana Nanda
Colombian family still
lived within sight of
Miami International
Airport. After graduating first in her high
school class, Helena
had gone north to college,
where she studied, among other
things, new-business funding in
Latin America. She was disturbed by
what she learned: It was easy enough
for an aspiring entrepreneur to get
a $100 microloan, but borrowing
sizable amounts was impossible—as
was obtaining any kind of venture
capital—unless you were rich and
from a prominent family.
Helena had dreamed of start-
MAJA MODÉN
William A.
Sahlman is
the Dimitri
V. D’Arbeloff–
MBA Class of
1955 Professor
of Business
Administration,
and Ramana
Nanda is an
associate professor
of business
administration,
at Harvard
Business School.
T
ing a nonprofit that would seek out,
mentor, and support high-potential
o Helena Valencia, Miami
did, he had argued at a board meeting
was home. She had grown up
a few days ago.
there. It was the place that had
Thinking of her own cousin
entrepreneurs in Latin America. But
it wasn’t until her first year of law
school that she’d found someone
shaped her understanding of people
Guillermo Pombo, an engineer
to help her: her classmate Conrad.
and launched her into the wider
who had recently graduated from
They’d bonded over their Miami
world. In fact, her love of the city’s
the University of Miami and was
roots and their desire to make a
mingled cultures and vibrant local
struggling to start his own business,
difference in the world, and soon
they began developing Helena’s
businesses was one of the things that
Helena could see where Conrad was
had inspired her to cofound Unamano,
coming from. And yet her instinct
idea into a full-fledged organization.
now a world-renowned nonprofit
was to oppose the idea. Unamano’s
Unamano’s purpose wouldn’t be
supporting entrepreneurship in
mission was to help entrepreneurs in
to raise cash and spread it around.
emerging markets.
emerging markets—not in the United
Instead, it would serve as a connec-
But Miami was not, in Helena’s
States. An American city, no matter
tor, recruiting local business leaders
mind, a logical place for Unamano
how disadvantaged, could fend for
to commit to helping entrepreneurs.
to expand next—a move that Conrad
itself, right?
Because the defining vision had
Abbey, her cofounder and close
Conrad’s proposal had divided
been Helena’s, she became the CEO.
Conrad was juggling too many other
friend, had just proposed. He
the board down the middle, with
was adamant that the city—his
half the members favoring it
pursuits to take an executive position
hometown too—met their
and the other half crying foul.
at the time, but he agreed to help her
main criteria for a target
Out of respect for her friend,
and serve on the board, and his ideas,
market: high and rising un-
Helena had held her tongue
energy, and fearlessness contrib-
employment, widening income
at the meeting. But she’d
uted to the organization’s success
inequality, and an inhospitable
been thinking about it ever since.
in attracting dedicated people and
environment for would-be entrepre-
Was he way off base on this one? Or
money. He’d been the one to suggest
neurs. Miami needed Unamano’s help
could Unamano’s geographic scope
that Unamano aim to quadruple the
just as much as Medellín or Amman
be expanded?
revenues of the small businesses it
May 2015 Harvard Business Review 113
EXPERIENCE
Case Study
Teaching Notes
targeted, an audacious goal given
adolescent; she and her sisters had
the long odds facing any emerging-
called him el cachorro, the puppy.
market start-up.
Helena realized that to meet that
But he was now a postdoc working
on a desalination project that he
goal, Unamano had to carefully select
believed could solve South Florida’s
the most promising entrepreneurs
water problems. He’d found a recep-
to assist, putting candidates through
tive chemical-company owner who
a gantlet of pitch sessions, refer-
was providing lab space and even
ence checks, and interviews. Once
some financial support. But it was
anointed as Unamano Entrepreneurs,
clear that Guillermo was much more
or UEs, they would receive abundant
of an engineer than a businessman,
free advice from experienced local
and despite his outgoing nature, he
advisers, be introduced to local and
hadn’t been able to find new mentors
global mentors and service provid-
or investors. Helena could see that
ers, and attend conferences and
his aspirations were being choked
meet-ups. Successful UEs would
by lack of access to experienced
be expected to become the next
businesspeople.
generation of local angel investors
“Is there anything Unamano can
and venture capitalists. Put simply,
do for me?” he asked plaintively as he
Unamano aimed to build entrepre-
was leaving the holiday dinner at her
neurial ecosystems where none had
parents’ place.
existed before.
Within a decade the organization
William A. Sahlman teaches the case on which this story is
based in his Entrepreneurial Finance course.
WHAT DREW YOU TO THIS STORY?
Endeavor Global, the subject of the original teaching
case, developed a set of ideas about the ingredients
for successful entrepreneurial action. The case
focuses attention on whether its model could be
applied anywhere in the world.
HOW DO YOUR STUDENTS RESPOND TO IT?
Most think Endeavor should stick to emerging
economies and not muddy its mission by going into
a U.S. city. A few see the potential benefits to the
organization and its mission.
WHAT LESSONS DOES THE CASE OFFER?
One lesson has to do with getting local buy-in.
Endeavor is successful only if leaders in each
community embrace entrepreneurship, and that
can’t be accomplished from a distance.
Helena told him she was sorry, but
few and far between. R&D invest-
it was out of the question. For now,
ment had been growing, but slowly,
stretched well beyond Latin America
at least, Unamano was focused on
and the region didn’t generate much
to the Middle East and Asia. It had 12
emerging markets, like Latin America.
early-funding activity. In the past year
country offices in places as distant
It didn’t have U.S. operations.
only 16 firms in greater Miami had
as Jakarta and Dubai and, while
“But that makes no sense,” he pro-
about 30 people worked in the New
tested. “The capital of Latin America
York headquarters, another 250 staff
is Miami!”
received venture capital.
People with entrepreneurial
ambitions learned early on that to
members were scattered around the
Guillermo had a point. Miami-
world. Businesses run by UEs gener-
Dade County, 66% Hispanic, was
move to New York, Boston, or the
ated $6 billion in annual revenue and
home to more than a million Latin
West Coast. Amazon’s Jeff Bezos, the
employed 225,000 people. Helena
Americans, some displaced by dys-
valedictorian of his class at Miami
had been profiled in Forbes, the Wall
functional regimes at home, others
Palmetto Senior High School, had
Street Journal, and the Economist as
seeking opportunity. It should
a champion of entrepre-
have been a prime area for
neurship. Although she
entrepreneurial activity:
was based in Manhattan,
It had a solid technology
she traveled constantly
infrastructure and a lot of
and was a frequent
people aged 25 to 44—many
keynote speaker.
of whom were engineer-
Still, she hadn’t for-
ing or computer-science
gotten her roots. She spent
graduates—as well as a
most holidays back in Miami.
large local consumer market.
And it was over Easter, a week after
But Guillermo’s struggles weren’t
Conrad’s board presentation, that
unique. The local economy hadn’t
she finally had time to catch up with
diversified beyond its base in tourism
Guillermo.
and real estate into fast-growing areas
Helena still remembered her
cousin as a friendly, energetic
114 Harvard Business Review May 2015
such as health care or bioscience, and
entrepreneurial success stories were
seek their fortunes, they needed to
been part of that exodus. As a result,
HBR’s fictionalized
case studies
present dilemmas
faced by leaders
in real companies
and offer solutions
from experts. This
one is based on
the HBS Case
Study “Endeavor:
Miami Heats
Up” (product no.
814043-PDF-ENG),
by William A.
Sahlman, Ramana
Nanda, David Lane,
and Lisa Mazzanti,
which is available
on HBR.org.
Miami was a prime example of
widening economic inequality. While
millionaires abounded, most people
in the region were losing ground
economically.
Helena’s and Conrad’s families represented those two poles.
Helena’s father had run a coffee-andsandwiches cart in downtown Miami.
Conrad’s was a real estate investor
in Coconut Grove. Conrad still lived
in that neighborhood and now ran
multiple companies, including an
oil-exploration firm and a venture
capital partnership.
HBR.ORG
From that perch,
“transforming
“OK, but Miami is in the U.S. How
he saw only potential
emerging countries
can any U.S. city be in the same sort of
in Miami. If Unamano
by supporting high-
was to meet the strategic
impact entrepreneur-
goal it had set out last year—
ship.” That was the vision
Tell us what you’d
do. Go to HBR.org.
position as Beirut?”
“We had the same kind of discussion when we were considering
to open affiliates in 25 coun-
that had attracted Lawrence
tries by 2020—why wouldn’t it
Melchior, a veteran social entrepre-
height of the recession,” he said. “But
consider the city?
neur, onto Unamano’s board as chair-
we all agree now that it was the right
man. Lawrence had told Conrad at
thing to do.”
An Acute Need
the recent board meeting: “‘Twenty-
On her flight back to New York,
five by 2020’ means 25 emerging
opening affiliates in Europe at the
“Yes, but it was Greece and southern Italy, which were getting killed
Helena ran through Unamano’s
countries. I joined Unamano to take
by high unemployment, currency
guidelines for regions in which it
it from being ‘charming’ to being
problems, and falling demand. The
would expand. They had to have very
globally important. And that means
need there was acute.”
limited access to key resources for
being in as much of the developing
scaling up young companies, such as
world as possible.”
“It’s acute in Miami too,” Conrad
said.
capital, talent, and mentors. But they
Although they’d all agreed to
“Sure, and in Newark, and
also needed to show promise, with a
table the discussion that day, Helena
Bridgeport, and New Haven. If we
healthy per capita GDP. There had to
knew the fight would continue at the
open in Miami, where do we stop?
be respect for property rights and the
next meeting.
rule of law; a cohesive culture; a ro-
From the taxi line at La Guardia,
Our whole mission will be watered
down.”
bust middle class; solid educational
she called Conrad. “Some board
institutions; a sizable population of
members think this will derail the
anywhere else in the United States,”
he said. “Only in Miami.”
university-educated citizens; a core
entire organization,” she said. “They
group of influential local business
think you’re just favoring your
leaders who had demonstrated a
hometown.”
commitment to boosting local en-
“Our hometown,”
trepreneurship; a modest level of VC
Conrad said in a
activity; and “pull” from the region
teasing tone.
in the form of a desire for Unamano’s
“I just don’t
“I don’t want to open in Newark or
“But what about the existing
affiliates?” she asked, with exasperation. “The managing directors in
Lebanon and Saudi Arabia and Brazil
and Argentina and all the others.
They would never agree to diverting
presence and a commitment of op-
think it can fly,”
our resources to the United States.
erational funding. A region also had
she said. “I don’t
And you’ll never get approval from
to have some local business leaders
think it should fly.
the board. Half of them are totally
willing to contribute funds or their
How can we hit 25
against this idea.”
time for a three-year period.
developing countries
Miami certainly qualified.
by 2020 if we get distracted
A local media mogul had already
by operations in the United
offered $3 million to get an Unamano
States? What will this mean for the
affiliate going.
Unamano brand?”
But how could the organization
“We’re focusing too much on coun-
justify opening an affiliate in such a
tries,” he said. “One thing we’ve all
comparatively wealthy city? Miami’s
learned over the years is that it’s not
median income was 10 times that of
about countries, it’s about cities. City
most of the cities where Unamano
demographics. City economics. City-
operated. And whatever problems
based entrepreneurial ecosystems.
entrepreneurs faced there, the truth
Look at Lebanon: If we had focused
was that America led the world in
on the country as a whole, we never
support for start-ups.
would have opened an affiliate there.
Besides, Helena kept going
back to her mission statement:
It’s Beirut that matters. We shouldn’t
be misled by national borders.”
Q
“I know one person who could
change their minds,” Conrad said,
again in that teasing tone. “C’mon,
Helena, trust me on this one.”
Should Helena
support the idea of
opening an affiliate
in Miami?
See the commentaries on the next page.
May 2015 Harvard Business Review 115