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Cordaid NL
Private Sector Development

From dream to business: crowdfunding in Kabul

With all the attention going to blasts and armed conflict, one would almost forget: Kabul is also a metropolis where millions of young Afghans give all they’ve got to find and keep jobs. Or to start their own business. Cordaid’s Bright Future program is there for them. It promotes innovative entrepreneurship, against all odds.

Here’s a piece of good news from Kabul you probably never heard: 22-year-old graphic designer Farid Sofizida managed to crowdfund his dream and started as a toy maker in the Afghan capital. Farid, now proud owner of Alef Toys, is the only toy manufacturer in the capital. The things he makes are not only of better quality than imported toys, they’re also much cheaper. “Whatever we make”, Farid says, “will enhance the power of imagination in kids”.

First Afghans to use crowdfunding

Farid is one of 30 young Afghan entrepreneurs who participated in the Bright Future’s training program and managed to use the program’s crowdfunding platform to raise over 1000 USD and start rolling. This makes him and all the others outright pioneers. Not only did they turn dreams into small businesses. They are the first Afghans ever to use crowdfunding. And by using a matching fund, the Bright Future program doubled the crowdfunded capital to get their businesses rolling.

By 2021 we want to have facilitated the start and growth of 120 small and medium enterprises in Kabul.

Mike Sips, Cordaid program officer based in The Hague

These Bright Future start-up graduates – men and women – provide the kind of goods and services no proper city can do without. There are engineers attacking pollution and electricity blackouts. Producers of delicious almonds, honey, organic dairy and vegetables. Young wizards creating software or setting up e-commerce and online shops.

A Bright Future for Afghanistan is a five-year program. It is financed by the Dutch Ministry of Foreign Affairs. Cordaid coordinates and implements the program in consortium with Dutch and Afghan partners: 1% Club, Bayat Foundation and Hamida Barmaki Organization for the Rule of Law. It enables young entrepreneurs like Farid to set up and grow their business. But it does much more than that.

Creating a better business ecosystem

Mike Sips, Cordaid’s Private Sector Development program officer based in The Hague, explains: “The overall aim is to create job opportunities for young Afghans in the capital. To do this we set up interlinked training modules that reinforce one another. Our Bright [email protected] vocational skills training sessions enhance the employability of young job seekers. Participants learn to write proper resumés and CV’s. They improve their language and ICT skills. With our Bright Business Incubator we coach and facilitate young entrepreneurs to set up their business, just like toy maker Farid. Basically, we guide and train them in the process of turning dreams and plans into actions and realities. And together with the 1% Club we offer them an online crowdfunding platform. In our first batch, 18 out of 23 participants succeeded in crowdfunding the seed funding for their start-up.”

Every year thousands of Afghans obtain Bachelor and Master degrees. Yet they can’t survive in an office setting.

Anwar Alvi, Cordaid program coordinator in Kabul

The other pathways of the program build up on these first two. The Bright Business Accelerator helps entrepreneurs to scale up and create more jobs. The program also invests in a better business ecosystem, by promoting business hubs and networks in Kabul and by advocating for policies that encourage youth entrepreneurship. It’s an ambitious program. “By 2021 we want to have facilitated the start and growth of 120 small and medium enterprises in Kabul”, Sips says.

Life of a job seeker or young entrepreneur in Kabul

Cordaid’s Anwar Alvi, who coordinates the program in Kabul, knows all the Bright Future participants. He knows what it’s like to be a job seeker or young entrepreneur in a war-torn city. And how badly Bright Future’s services are needed. “Let’s not dwell on the constant insecurity, locked roads, limited movement, lack of electricity. They hamper life, they hamper trade, education, everything. We have known that for decades, we are forced to work our way around that.”

bright future

One of Bright Future’s training sessions in Kabul. (© Cordaid)

What Alvi does want to dwell on is the gap between university degrees and real life. “Every year thousands of Afghans obtain Bachelor and Master degrees. Yet they are not equipped with basic internet, computer and language skills. They can’t survive in an office setting. Most of them never had an email account, to give just one example. Those who are lucky and rich enough to have a computer or a smartphone, lack the money for internet access, which is expensive here. That’s why we are training them in Outlook, Excel, in basic bookkeeping, in English. We rehearse job interviews. In short, we simulate modern day office life. When we started, over 1200 job seekers applied for program within 10 days after the announcement. We have now trained 140 of them, including 56 women. 40 have been offered internships, 9 have a full-time contract.”

General and personally targeted insecurity

Finding a job is one thing. Setting up your own business in Kabul is a bigger challenge. Alvi: “Obtaining the licenses to start doing business and to trade, is a hell of job. It takes ages. Once you can start, you soon find out that making profit comes with risks. Life-threatening risks. Online banking systems are not common and not trusted by most people. So, transactions are in cash. Cash you have to travel around with.

Toy makers, software engineers and mushroom farmers, I am glad we can serve them in crafting a future of their own here in Kabul.

Anwar Alvi

This means that on top of the general insecurity everybody has to cope with, you have to cope with personally targeted insecurity. The more successful you are, the more money you represent. Kidnappings of entrepreneurs or their family members are common practice. So, part of being a successful entrepreneur in Kabul is not showing how successful you are.”

3 to 5 months’ training programs

Alvi and his colleagues on the ground go a long in assisting the selected start-ups to spread their wings. “We train them 3 to 5 months. Then we offer free workspace, Wi-Fi, laptops. We help them work out business plans, safe and successful branding strategies. We help them set up Facebook pages, which in Kabul is still very much a professional tool. And we assist them in investing their seed money wisely. Mostly it goes to licenses, furniture, pc’s and other items that are needed to physically start a business.”

bright future

Another Bright Future training session in Kabul (© Cordaid)

No banners, no logo’s

Serving young job seekers and entrepreneurs in Kabul, comes with challenges of its own. “We never display banners, billboards or logo’s in our classrooms and training centers”, Alvi explains. “It’s too dangerous. And our intake interviews with Bright Future applicants are always one to one. We carefully verify their certificates and degrees. This is to make sure that we are dealing with reputable persons.”

Serving the ones who stay behind

Alvi knows all the trained job seekers and entrepreneurs personally. “They represent all of Afghanistan”, he says. “They speak all languages, cover all ethnicities, come from all provinces. Conflict and poverty drove them and their families to Kabul. And unlike the very rich and fortunate who have left the country to seek safer grounds, these are the ones who stay behind.”

As the program is growing every year, Anwar Alvi won’t be able to stay in touch with every individual Bright Future participant. In the next round, starting soon, over 60 entrepreneurs will start building their own business. And of the thousands of fresh graduates who will apply, hundreds of job seekers will enrol. “No worries”, he says. “I will still meet a lot of them. Toy makers, software engineers and mushroom farmers, I am glad we can serve them in crafting a future of their own here in Kabul”, Anwar concludes.

Read more

Go to the Bright Future website. Read more about the participating start-ups.

Go to Cordaid’s Private Sector Development page or read more about what we do in Afghanistan.