CONSERVATION ENTREPRENEURSHIP

In landscapes where people and natural systems coexist and intermingle, conservationists must go beyond protection and work to develop community-level incentives for biodiversity and wildlife conservation through sustainable and locally managed use.

In the recent past year, the global biodiversity crisis has been forced to the forefront of public consciousness: Human activity has impacted up to 75% of the earth’s land area, and has the potential to drive up to one million species into extinction. But while most traditional conservation efforts focus on setting aside protected areas which cover about 15% of the earth’s land and 3% of its oceans conservationists must also address landscapes where people and natural systems co-exist, where nature is intertwined with human development and social change.

 

This is particularly crucial in fragile ecological biospheres of the Himalayas, where some of the world’s most iconic wildlife ecosystems are inextricable from growing human populations in rapidly changing societies. Rural livelihoods depend on these forests, fisheries, and rangelands, so effective and lasting conservation strategies must find ways not only to protect wildlife and the environment but also to deliver economic opportunities at local and national scales. In Nepal, for example, outside government parks and reserves, and adventure and wildlife tourism is a multi-million dollar industry in the country. Changes to Nepal’s forest laws have created new opportunities for local communities and social enterprises to create economic opportunities linked to forest conservation.

 

All of this is easier said than done, and conservation is littered with projects that promised to make conservation profitable and beneficial to local communities but struggled to deliver. But since Nepal’s community led social forestry movement in the 1980s which helped pioneer the idea of generating community-level incentives for biodiversity and wildlife conservation through sustainable and locally managed use the region has been a source of fertile innovation for conservation efforts around the world. Today, it’s clear that it can be done: A ‘Conservation Economy’ can create jobs and attract investment while protecting and sustaining the ecological wealth that peoples’ livelihoods depend on. A rising generation of Nepalese social conservation entrepreneurs are reframing conservation as a growth sector:

 

In adventure and national wildlife parks under tourism sector and indeed much of the South Asian world tourism entrepreneurial conservation is leading the way in four key areas:

One of the largest barriers to entrepreneurial conservation and sustainable management can be when wildlife, forests, and fisheries are owned by the state whether due to historical legacies or political ideology and opportunities for use by local communities are limited. Weak or absent local property rights can, in turn, limit investment in those resources by businesses and local communities: Without rights to use, manage, or control their wildlife and forests, local communities have little incentive to sustain or protect them, and often prefer alternative land uses such as clearing forests for farms. Granting clear rights over natural resources to local community institutions are a key foundation for more successful conservation approaches, and for unleashing investment in those resources.

Even when communities can secure rights over their wildlife, forests, and other natural resources, they still need the capacity to serve as effective managers, to enter into business partnerships, and to plan for its long-term stewardship and development. This often means overcoming decades of dispossession and marginalization, as well as building new capabilities to manage natural resources sustainably.

Nature-based businesses usually require two critical parties to come together: rural communities that live alongside and act as long-term stewards of natural resources and businesses that bring capital, market access, and operational expertise. When these parties speak different languages figuratively or literally getting them to work together successfully can be challenging, and often requires facilitating new relationships through skilled intermediation.

If conservation ventures want to scale their impact, investment needs to increase rapidly. For this to happen, however, venture financing needs to recognize how expensive and time-consuming it can be to establish businesses based on community-private partnerships. Forging partnerships that value conservation impact, securing the necessary regulatory frameworks, and effectively monitoring conservation outcomes can all increase venture development costs and timelines.

To face up to today’s unprecedented pressures on the earth’s living systems, conservation efforts around the world urgently need to become more entrepreneurial, more collaborative, and designed to deliver impact at scale. Conservation efforts need to generate wealth for local people from sustainable businesses based on natural products, operating through partnerships with local people who use and manage their lands and environment. Government, business, and entrepreneurial local organizations that can broker new relationships and partnerships all have a critical role to play in enabling such models. Conservation initiatives around the world can draw key lessons, and inspiration, from the models being developed by a rising generation of Nepalese and Asian conservation entrepreneurs.

 

Scaling up their work and impact will be key to finding solutions to the biodiversity crisis that deliver results for both people and nature.

Entrepreneurship is the pursuit of opportunity without regard for the resources within one’s control. Although commercial entrepreneurship focuses on creating demand for new products or services, a new breed of entrepreneurship, social entrepreneurship, aims at serving basic, long-standing needs more effectively. Social entrepreneurship is unique because it tries in a prominent way to create social value by exploiting unique opportunities and applying innovative methods and technology to overcome resource limitations. Despite extensive examination of entrepreneurship in sociology, anthropology, politics, law, and education, its potential in conservation has been mostly ignored. However, certain conservation problems are particularly amenable to innovative solutions and can be financed through novel fundraising tools. An entrepreneurial approach to conservation can complement conventional approaches and increase conservation efficacy.

Various definitions of entrepreneurship are loosely based on the size of an enterprise, its rate of growth, its innovativeness, and its adaptive capacity. However, it is perhaps more pragmatic to define entrepreneurship in conservation by contrasting it to conventional conservation. Although this is complicated by differences in size and geographic location of areas and the species and ecosystems conventional agencies aim to protect, one feature typifying many modern agencies is their centralized focus on a limited number of clearly defined priorities. This approach limits needless duplication, reduces competition among independent agencies, and increases the cost-effectiveness of identifying and acquiring land for conservation due to economies of scale. Despite these considerable benefits, this centralized approach also has three major shortcomings. Conservation activities are predominantly carried out by a few large organizations, especially at the international level, and these organizations usually do not represent a variety of divergent conservation values. The desire to leverage economies of scale immediately directs resources toward large and commonly shared conservation objectives, which overshadows smaller local issues. Due to substantial investments of time, money, and effort, large, and long-term conservation projects are more susceptible to the negative consequences of sunk costs (i.e., their future decisions may be affected by retrospective costs, which cannot be recovered), and this hinders the rapid realignment of Strategies.

 

The distinction between conventional conservation and conservation entrepreneurship should, however, be viewed as a continuum. At one end is the caricature of conventional conservation described above, whereas the brand of entrepreneurship I propose forms the opposite extreme. This brand of self-started entrepreneurship aims to sustain many, smaller conservation startups, promote diversity of objectives, and address local conservation problems through innovative and cost-reducing methods. These startups may demonstrate lower vulnerability to sunk costs and a greater tolerance of uncertainty than conventional approaches; thus, they may be especially effective with problems requiring adaptive management solutions.

In the wider economy, entrepreneurship rose in prominence after the manufacturing based industrial economy was replaced by the current service-based information economy. A similar shift is taking place within conservation. Although centralized conservation agencies remain more effective at certain tasks (i.e., the identification and purchasing of land for conservation), many issues in conservation are more amenable to an entrepreneurial approach. These types of problems can be addressed by inspired individuals who use innovative tools to provide high conservation returns for each dollar spent. Typical examples include the rise of evidence based conservation and the systematic evaluation of past conservation interventions. Assuming that entrepreneurs possess all the necessary skills for these tasks, the only limiting factors are original ideas and data availability; the open access movement throughout conservation science is making the latter less restrictive. Comparable opportunities include the development of analytical decision making tools and the aggregation of scientific output in a user-friendly format to enhance scientific communications.

 

Innovation alone may not always be enough, but advances in technology and financial mechanisms are making fundraising more accessible to those outside traditional donor funded systems. One new source of funds is crowdfunding, which uses Web based platforms to solicit donations from the general public. Philanthropists contribute to conservation projects without expecting financial returns in donation based crowdfunding; the most popular form of crowdfunding. The majority of successfully funded initiatives are relatively small (<US$1,000),but others reach upwards of US$45,000 in rare cases, as was the case for a Kenyan initiative to patrol for rhinoceros poachers with unmanned aircrafts in the Ol Pejeta Conservancy (Indiegogo 2013). A drawback of this form of funding, however, is the uncertainty surrounding its effectiveness. Although self-reported success rates of various crowdfunding web platforms vary between 20% and 50%, it is almost impossible to confirm these figures independently because failed fundraising campaigns are rarely publicized. Consequently, crowdfunding is still very experimental in conservation, but one could argue that this uncertainty is offset by the low cost of participation.

 

Other flavors of crowdfunding are even more experimental. For instance, equity-based crowdfunding offers impact investors shares in an enterprise, which partly compensates for the risk associated with high failure rates of startups. While there are no obvious public cases of equity based crowdfunding in conservation yet, this may soon change due to progressive legislation promoting it, such as Section III of the Jumpstart Our Business Startups, or JOBS, Act in the United States. A similarly untapped source of funds in the conservation sector is debt based crowdfunding, or microfinance, where individuals make loans instead of donations. Here borrowers gain access to favorable interest rates because individual lenders bear lower risks of loan defaults. Microfinance currently serves 90 million borrowers worldwide and, despite practicing in some of the poorest countries, is a US$65 billion industry (Bugg-Levine et al. 2012). Although equity- and debt- based crowdfunding risks alienating donors who contribute to charities for moral, social, or tax-based reasons, these forms of crowdfunding could create opportunities for conservative investors who prefer market driven conservation.

 

As with other new technologies, crowdfunding should be viewed with a healthy dose of skepticism. Despite increasing our ability to meet donor expectations more effectively by allowing the support of individual initiatives, Web-based fundraising suffers from the same limitations as conventional fundraising because the internet cannot create donors that do not already exist. This perpetuates the view that crowdfunding can only sustain projects involving charismatic species that grab the public’s attention. However, such perceptions have been dismissed by those who argue that public engagement, whether through online social media or offline public outlets, is the greatest predictor of crowdfunding success. Additional funding opportunities for entrepreneurial conservation involve a fusion of financial tools; an option not always available to conservation agencies registered as charities for tax purposes. Currently, <15% of the investment assets of charitable foundations in the United States are donated annually, so the other 85% could be leveraged to attract investment from mainstream portfolios through novel financial mechanisms. By combining donations and loans, for instance, The Bill and Melinda Gates Foundation now provides philanthropic organizations the option to raise commercial debt at lower rates by issuing loan guarantees instead of direct funds. This flexibility also benefits investors, who can serve as intermediaries by supplying venture capital funds and rigorously selecting recipients based on their potential contributions. The Wildlife Conservation Network (www.wildnet.org), for example, increases the proportion of funding for on-the-ground conservation by acting like a venture capital fund and investing in external startup initiatives rather than using these funds themselves.

As with commercial entrepreneurs, those initiating their own conservation startups might face considerable personal investment and high rates of failure. However, these disincentives should be considered in light of the prospects for permanent employment in conservation. The conservation community has always relied on unpaid volunteers and interns, a practice that often causes undue personal hardship, excludes many potential candidates based on economic status, fails to meet societal labor expectations, and devalues conservation science as a profession. Moreover, the prospects of permanent employment in the conservation sector are also dwindling. Just recently, the World Wide Fund for Nature followed Conservation International and The Nature Conservancy by downsizing its core group of conservation scientists. They now intend to collaborate with external scientists on a part-time basis in a move designed to provide more flexibility in response to modern conservation challenges. These events suggest that early career conservationists should prepare for a future where being employed means maintaining a portfolio of independent projects, each with a predefined start and end date, rather than a life-long career with a single organization. Perhaps we can make this transition easier by embracing conservation entrepreneurship and assimilating the available technology and funding models into everyday use. This necessitates transparent reporting of early successes and failures, which will not only assist donors make more informed investments, but also guide future entrepreneurial efforts.