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How to create economic prosperity in rural communities
In this episode of the Better Heroes podcast series, host Matt C. Smith talks to Sebastian Salinas about working alongside rural community members to teach entrepreneurship and economic development.
Related topics
What do you do if you live in a rural community where jobs are scarce? Is migration to a bigger city a sufficient solution? How can we develop local economies?
Today’s Better Hero is Sebastian Salinas, Founder and Executive Director at Balloon Latam. His goal is to work alongside rural community members to teach entrepreneurship and economic development.
Learn more about Balloon Latam here.
Key takeaways:
- Balloon Latam aids in the development of rural communities by facilitating the acquisition of skills and resources, empowering local entrepreneurs and artisans to flourish.
- Through the EY Ripples program, EY professionals work with impact entrepreneurs in-person or virtually, offering support to help improve their businesses’ resilience, productivity and capacity to scale sustainably. The program brings together the combined skills, knowledge and experience of the global EY network in pursuit of one shared vision: to positively impact one billion lives by 2030.
You can also listen to this podcast via other platforms including Apple and Spotify.
For your convenience, full text transcript of this podcast is also available.
Sebastian Salinas
We live inside the community. Our teams are there, and they see these guys are here. They have an office, and I can go there all the time. Our offices are big in these places, so it's an open house so people can gather and do different things. You have these projects where someone has an idea now they can have a product. Then we have these brand products also that they want that they'll have a brand, we develop their brand and do the packaging and all of that.Matt C Smith
Truth is humanity can save itself and our planet. And right at this very moment, there’s someone who took on the challenge — and is on a path to solving an incredibly tough, global problem. This podcast was created to tell you about them.You’re listening to Better Heroes, a show from the global EY organization about the untold stories of entrepreneurs devoting their lives to impactful innovation. I’m your host, Matt C Smith.
What do you do if you live in a rural community where jobs are scarce? Many people are forced to leave their homes and migrate to the closest major city for better opportunities. But what if migrating to the capital isn’t easy? What if you live in Chile, for instance, where 83% of its territories are actually rural? What if you have a family that you can’t leave behind? Moving isn’t always possible. So, what do you do?
Sebastian Salinas has found a solution with Balloon Latam. He’s the founder and executive director. Balloon Latam is a social enterprise platform that develops local economies in Latin America and strengthens ecosystems of entrepreneurs. Balloon teams go to rural communities and help develop skills and install resources so that local entrepreneurs and artisans can thrive.
Salinas
Chile has 345 communes, 263 are rural. The thing is that in those 263 communes lives 30% of the population. Most of the time public policies don’t have the pertinence or base for those rural areas because most people live in urban areas. So, Chile has these big issues, most of the decisions are taken in urban places, thinking of what the rural places need. But this is a huge gap of what you can find, we have ten different indigenous and different communities and communities of ten different types. And that makes us a country with a lot of diversity, not just because of the different places, but also because of the culture. Here also 12% of the population in Chile is indigenous and especially one called the Mapuche. So also, this is one of the biggest challenges in our country because there are a lot of conflicts between the governments. I say governments because all governments have faced this with indigenous communities, especially, the Mapuche because of their land.Smith
You mentioned that there are different indigenous communities and sort of this dispersed population across counties, municipalities, rural and then a small minority actually sort of in the built-up, urbanized, gentrified capitals. Right? What are some of the negatives that are associated with having a country that is so widely rural and so widely distributed?Salinas
Well, we are facing one of the biggest crises in the world, biodiversity and climate change. And rural areas are the first ones that are facing that or seeing that. And most of the time you're going to see a lack of access to basic services, opportunities and in some places, a lot of rural places there is no presence of the government because they are too far and there are not that many people that live in those places. So that's something that people that live in rural areas face all the time, like connectivity. For example, in Patagonia, if you want to have your baby there, women have to travel 8 hours a day and live one month in the capital, because if they're going to give birth where they live, they are not going to be able to get there because the road doesn't allow that. But I believe there are more good things in their rural places. Imagine if you close your eyes and you think, think about the paradise or being in paradise. I believe it's difficult. And if you take 3 seconds to think about that, think in a big city.Smith
Yes! Do that! Close your eyes and imagine the snow-capped mountains of the Andes, the lush green hills and meadows. Look at the beautiful trees, the rushing waterfalls, imagine a paradise. It’s all there in nature.Salinas
And also I believe that that's something that we are facing the challenge of development, that we have to be careful of what is going to be happening in these places specifically because it's a good thing. But also, we have to be taking aware of what is going to happen.Smith
I love how you finish that off with some of the beautiful positives of being in a rural community, like you said you are living in one right now. But I wanted to double down on that, actually. You mentioned I mean, evidently and in your case and what work you do that we'll speak about in a moment is a lot about helping social economic mobility just before we get into that, what are some of the benefits of being based in a rural community?Salinas
I believe that one of the biggest challenges is that we have these natural eyes as human beings, we believe that we are our own nature, and we are part of nature. And when you live in a rural area, you are facing or living that you are part of nature all the time and also you can see the effects, for example, of climate change, all that directly out of your window, maybe in the sea. So that makes me believe that development is not a material thing. Development is a conscious thing. I believe that naturalization of human beings of the world, they believe is something that these education things that have rural areas, that is amazing. Also, you can have your food directly from your neighbors as you as this is a community that most of them the government is not here because not because the government is bad, but because they are too far so you only have your neighbors to do something. So those kinds of communities we share a barbecue we go hand kind of together with our neighbors maybe that kind of thing is not happening right now and in cities, I'm not saying that in all of them but is something that this community. I believe that is something that rural area has to give us. And also, there is the feeling of being surrounded by nature is something that I believe is one of the biggest privileges that you can have by being in a rural area.Smith
On that note of health and nature, it's been proven that if you spend 20 minutes a day in nature, you don't have to be barefoot, you don't have to be running in the forest. But if you spend 20 minutes in nature, that can be a park in the city that can help to de-stress your life profoundly. But, Sebastian, one thing I always try to understand and our dear friends listen to this too, on this podcast is. The man behind the business, the team, the idea, the ideology and the hypothesis of Balloon in your case. And where did your passion for this start? Where did the inspiration to do what you were doing start? Fill us in a little bit about Sebastian from childhood to education to Balloon today.Salinas
Well, the story starts because I played a lot of soccer and I love soccer, so I play a lot and I play in different teams. That gives me the chance to travel through Chile and start looking at different realities through soccer. So maybe most of the time when you go to a place that you are not from there, you are not very welcome. And because I was good for the play, the goal and all of the people say, you can play with us and, etc. So, I started knowing a part of my country by playing soccer, I never had the chance to see that, feel that and live that. And because of that, I say, well, there's nothing that we should be doing. And I realize that with the ball from soccer, you can gather people together, maybe we are not friends, maybe we don't speak the same language, but we can understand and start creating bonding to a nation through the ball. So, when you see that in rural areas are the biggest inequalities, you see that using the example of football, that one ball got two people together, beyond the difference, I was thinking, what is something that could gather people together in a rural area? And when you see that the economy in rural areas is seasonal what happened is that depends on the season is the economic activity that they do.Smith
Is that because agriculture is the typical line of business?Salinas
Agriculture, tourism, gastronomy, I don't know. They can make products. I don't know, but it depends on the season. So you will find that a lot of entrepreneurs realize they don't believe that they are into business and have two or three different activities during the year because of the season. So they say, this is something that most people have in common. And so all the time when we started like gathering together, we can see the difference that we have, but we can see what are the things that we have in common and what things that the people in rural areas have in common is that they have more than one activity, economic activity. So that's why we thought, why don't we gather together people in rural areas to develop their own products? And well when I when I started gathering and inviting people, you have this idea how we can help you? Or what do you want to do? The people start saying, I want to participate, I have this idea. I have this project. So that's the excuse. The project is an excuse to gather people together. And I don't know if I tell what we do about what is the thing. When you gather people together, we start like a process, and through that process, we start bonding relations and social capital data. And we start this value model that I can tell you more about.Smith
So will come to Balloon now which is obviously this business that you have been running now in Latin America. What is sort of the mission and the vision of Balloon?Salinas
Well, we want that the communities can be the protagonist of their own development. I said one of the principles of the social press is that people that are going to be affected by one decision should be part of creating the building of that decision. So, most of the time there are people with very good intentions say these guys need this. But those guys are going to be affected by that decision and never participate in that because we know that we have to develop in some specific way. But development is not the same if I asked you, for example, Matt, what do you think about development? Easy. I'm going to say something to myself. If I ask an indigenous guy, I'm a butcher, for example, is he going to say something different? Another guy from South Africa is going to tell me thing so and development is it's a genius concept. So it depends on the specific territory. So what we see is how we can help and support the development of these rural areas to the place that they want to go to. That's the main vision.Smith
To figure out what a community needs, you have to be a part of the community. Sebastian did exactly that. To grow Balloon Latam to what it is today. He spent time living in these rural communities and working with entrepreneurs.Salinas
I was working there South of Chile, near where I am living right now, ten years ago, a week, working with indigenous communities, helping them how they can tell a story, to sell their products. Imagine that these are products that take the color of a tree or a leaf, and they put that color in some cloth so that say, you're selling nature. This is amazing. But they don't see and realize that.So being part of the development of rural places by the assets and the knowledge that they have and can be complemented with some other knowledge opportunities that we can bring here. So that's how it starts Balloon.
Smith
So how does the Balloon model actually work? Take me through sort of the user journey, if you will. Take us to the beginning of that and how you actually implement such a program, how it works in a rural village.Salinas
We have local partners that are institutions and government institutions, companies and NGOs and foundations that hire Balloons and say, Baloon I want you to go to this place. And we have a contract with them for at least four years. That's the minimum that we work in rural places. So, when we get to the rural place we do a social, and environmental diagnostic, we analyze the cultural, economic and environmental part and the political party. So with that information, we do our social capital map, so we analyze the relations that people have in the community with the public institutions and also with the private sector with that data we install a team we have, I don't know, 32 offices in different communities. And so we start a team based on the information and we start inviting people to say, come with your ideas, with your products, and we're going to be working with you for at least four years. So we start this entrepreneur journey that are different programs that get in the community very intense and then get out what type of we have a fellowship program international, for example, that people are flying all over the world to come to Chile, to develop local products, to help develop local projects for five weeks. And this is a certification of a university here in Chile that is called Catholic University that gives you a certification of social innovation. So, it's a master. We now have practically 300 hours of work.Smith
So why four years, how did you figure out that four years is the time that you need in order to do that? And also, how do you capture the data? Because I can imagine, obviously we're talking about rural communities, right, where not everyone has a mobile device. In fact, probably very few do in terms of, Wi-Fi penetration, electricity, maybe in some, there's a lack of infrastructure. So like, how do you actually capture the data and why four years?Salinas
Four years because we have realized that it is at least for making systemic change is the least time that you're going to be having the trust and the confidence of the community with you. And that's the minimum. And also the authorities are elected every four years. So also we start with one and then we get out for the other one. So that's also one of the main reasons why we use four years and as the data, we have these external evaluations that are coming to the community and to start interviewing the people.Smith
You can’t just collect data. You have to utilize it. Sebastian and Balloon Latam don’t just use their data to increase financial gain for their entrepreneurs, this data is affecting policy in Chile! Listen to Sebastian as he explains …Salinas
So we have these 76 indicators that are rising every year. We continue measuring that and also we complemented with the different public information that we can compare and what happens most of the time is that we have better information or more information about the government because for example, in rural areas, the economy is mostly 60% informal. So we are not going to have such a big information in the public it's a public administration. So what we use with that data, we take this and show them to the government so they can do new or better public policies for these specific places. So I will say in this program that is called international Balloon that people all over the world apply for these fellowship programs and then get out. So that's happened every year. We have partnered with 15 universities. That's called the Balloon U. Students of the university also come and work on the same projects. We have our own rural development fund, so we invest in the role of business that they don't have access to, for example, to a bank and we just charge the inflation rate and so they pay back this money. Also we have the mentoring programs we have business round. So, it's a huge process, like a journey that they are putting on the science of this is when you gathered these people together with the skills of the end of their projects. As I was saying, they start creating this bonding relationship between them, capital and with us. And when you have the community places, you have a mass, you have data and you have such capital, you can get to the third part of our model, which is the infrastructure thing. The infrastructure is water projects in the pipeline, improving roads, programs, internet, for example.Smith
So say I'm one of those, let's call them vendors or artisanal creators. And I'm doing three different businesses cyclically throughout the year based on the seasons. How do you help me understand that what I'm doing is a start up and it's in itself? How do you educate me and what is the goal of using balloons platform with me?Salinas
We live inside the community, our teams are there. So they start seeing these guys are here. They have an office. I can go most of all the time. Our offices are big in these places, so it's an open house so the people can do different things. So you have these projects. They see what seems like a good example for someone to have an idea now to have a product. Then we have these brand projects also that they want, that they'll have a brand with to develop their brand and do the packaging and all of that.Smith
Actually work on logos, you work on slogans, you work on, you know, the typical brand strategy is right to work on. What is your mission, your vision?Salinas
That's correct. So it depends on the specific needs. Yeah, it depends on the stage of the entrepreneur. So if you have nothing, you go to the basic one, they go to the intermediate and they go to the offense of the ones that already met the advance or interim. Yeah, goes directly to those parts. For example, they told you we have these rural development funds and so you have to be more advanced to access that kind of money. So if you do have a logo or branding, etc., you cannot get there. So there are some steps before getting to those places. So that's one thing. The other one that is also really good is to take people out of the community. So we do exchange through different communities a lot and because then they say, Wow, it's really beautiful where I live. Wow. I know the marmalade that I'm selling is much better. And here they sell it for much more expensive than the one where I was selling. So that kind of mindset because there's a lot of people that's never been out there. So we do a lot of exchange there. We're looking at rural communities. And also what happens is that we have been here for ten years, so Balloon is a public recognition institution. So what happened is that we can get to the government, to the different ministers of different institutions to say, these you should put this here, or you can get these fund to or these specific project to this, and now we can do that before now.Smith
It sounds amazing. So I'm along the process now. You've shown me how I can maybe level up the business because I would like to do so, how I can access new resources. Maybe you've given me some visibility on your platform. So say I go along the process and we're four years down the line now. You know, I'm better educated potentially. I’ve been able to socioeconomically grow my own standing, my own village, my surroundings, and maybe that's had a benefit on the community itself. What kind of benefits, after four years would we expect to see in my community, given this example?Salinas
When I say the four years is that the team that lives inside the community is going to stay at least for four years. But all those entrepreneurs continue in the community of Ballon. So there's a lot of communities that we have gotten out, but they still are part of the community. So we have different benefits like the rural development fund or different events that we also continue offering to these communities. So because it's a relationship that's going to be for the rest of the life. There's a lot of community responsibility. So most of the time people are the ones that are solving the problems of the community. And why, for example, is there a big amount of such entrepreneurs in Latin America? Because the private sector is doing things that most of the time more developed countries, the public sector is the ones that are taking, are facing those challenges. So what happened here in rural communities when there is more power that you can realize that they can do things, they can realize that they have these connections now. They are the ones that are going to be solving or helping others to get to solve their projects and also one of them there are a lot of things that you can imagine that are an indirect impact. So, for example, we have this I don't know, it's funny, but it's something that there's a lot of divorces and 75% of our community are women.Smith
Why is that?Salinas
Because what happens is that they are the ones that stay more than the house. So they are more and more disposed to come to the process, to the programs and all that. And one of the main things that happened when you have inter-domestic violence is because of the lack of economic independence. For example, when you are more economic and you have more economic independence, women with this project say, I don't need this guy, I don't know, I would not accept that this guy punched me every day or different things. So those kinds of things, something that we don't look for, but those kinds of things because being more empowered happen.Smith
What are the other benefits? I mean, we've obviously had that amazing ancillary benefit that by empowering, obviously 75% female and artisanal workers, makers, homemakers as well, you've allowed them to actually develop females the role of women in their communities and their societies. Right. And feeling empowered because of the economic difference. Right? What other benefits? I mean, talk me through the typical village after those four years, do you measure the impact from when before you started and then after?Salinas
So it depends on the community but we have been, for example, giving 22% more access to water to different communities because of the water price, that we can do. So we have a lot of contracts that is one of the services that we sell to companies is the soft landing. What is a soft landing? So people say, I have this technology or this thing that I want to give this or put this in this specific community. So we have the community have the data and the information. We say we're going to do a soft landing of this thing. For example, what we're doing with the start, we are starting installing internet to these places that if we have no if we don't have this community, they are not going to be partners. So we are doing digital informatization so they can use the internet through these places to do these places or water these projects. And now with remote, what is this another solution? We are putting different technologies so they can convert and use their water. But with the Ministry, for example, we are doing roads in indigenous conflict areas because of that. So those kinds of things are based and you will see because it depends on the community. As I told you, when you have the mass, you have the data and you have the social capital. That's the biggest asset as Ballon we have. And with that, we can bring other technologies for the other support for a specific community. The community decides what are the specific needs. We want water, we want the internet. We try to bring those to different communities.Smith
You let them decide what they want and then you effectively create that bridge between and in the case of StarLink, you know, Wi-Fi and connection connectivity to that village and the case of some of the others, it's water, it's infrastructure, it's roads, it's maybe health care. That's all of the above.Smith
While you're doing that, I'm just curious, obviously you're going into these communities which obviously change at different communities, different regions, different products, different people, different languages, in some cases different dialects perhaps, right? How do you go in there and I know you said this at the beginning, you were very cautious about it because, you know, there's a perspective of like this is sort of colonialization right, you're avoiding that by going and allowing the local community to make the decisions for themselves. But how do you manage that? How do you maintain the authenticity in that community while giving it the access and mobility of large cities around the world?Salinas
The first thing is that our team is a local team, people that live in the community. That's one of the main things I would teach our team first. Our base most of the time are from the community, so we handle that. And the other one is that we have a lot of information or previous information, and with that information, we can see what they want to preserve and what they want to do. And the other thing is that most of the time we don't have to romanticize poverty. And so you see all these amazing going to change this. But if you ask two people, I need a supplement here to get to my house, I'm not getting used to all the winters. I cannot get out of my house because I don't have any roads.Smith
So how many communities have you worked with and how many have succeeded? How many have failed? What are your traction metrics on communities globally?Salinas
Chile has 263 communes or 263 rural municipalities. We have been working in 72 and we have carried more than 7,000 or 7,200 jobs. We have had 5,600 local projects. 75% of them are led by women and 45% of them are led by indigenous people.Smith
It's amazing Sebastian. What you've created and how you've created this infrastructure and what just stands out to me is that it's led by the communities, right? You know, you go in there and say, look, we can provide you with infrastructure, access, knowledge, but you need to lead this. And I'm sure you've come across cases where it's not worked in some communities here and that with the amount of volume and the scale to which you're producing this in, you've effectively created the Balloon blueprint, right?Salinas
The things that don't work at the beginning we get out at the beginning of one year, we say this is doing nothing here. Good things would take two years but how did we get the private sector insight, and how did we get the public sector? So the model was developed during the experience and the failures that we were facing during these ten years. And that's why we realize that four years, is the minimum time that we have to be here and that we have to partner with the public institution and also the private ones so they can gather that, get inside to commit.Smith
Are there any organizations you know, on the other side of that, you said post working with these communities, uplifting them, allowing them to uplift themselves, or any businesses that are trying to get access to? You've got StarLink already, so you're doing pretty well. But what's next for balloon? What are you? What are your bottlenecks? What are you trying to get access to? To keep leveling it up?Salinas
We create a Balloon lab innovation and development area here in Balloon that is using the assets of Balloon. What are the assets, the trust, the people, the information? And we are developing local projects or big projects with that. So, for example, now we're going to have offsets, a carbon offset program with the community balloon entrepreneur. So most of that has to have land. And so we rent in that and we are planting trees and we are selling carbon so of the 32% of the income gets in the gets from them and we put them in the carbon market. So it's a new way of protecting and using native trees, for example.Smith
This is so interesting to learn about a platform that you've localized, and it's allowed communities to grow themselves socially, economically, mobility-wise, in terms of access to so many things that we take for granted on a daily basis. I just wanted to finish with, you know, your drive and your goals with this. What is your drive in all of this?Salinas
How can I live for something I will do for free? And I continue saying to that question, I'm doing that. And to realize that being a bridge or supporting people to be part of their development, what they want to do or what they want to have is something that has no price. So our main thing is to know that being an entrepreneur, is difficult. Being around social entrepreneurs is much more difficult. So I know I'm not taking for granted how much time I work to continue to invest because it's hard. It's like 80 people that work, for example in Balloon right now and 56 are full-time, and the other ones are temporary. I say enjoy the journey and say watch if I can live my life by doing this. That's a privilege. And I will continue on this journey because we are all the days is something different. All the communities. When you go and teach, you can learn something completely different. I never leave the identity of these people. You see the difference.Smith
Sebastian, so enlightening to hear about what you’re doing with Balloon, incredible work so far. And I say so far because, I mean, it sounds as if with the blueprint you have succeeded in creating, this can be localized and scaled across the world, supporting rural communities and influencing governmental policies. Right. You've had a success in Chile so far with potentially Kenya being next on the list. What have we got to look forward to?Salinas
We are in Mexico and Chile, and we were in Argentina and Venezuela because of the situation of those countries we had to close. So we are based now in Chile and Mexico. So the next two years, we are focusing on big growth through Chile and getting the base to scale. And then we are looking at different countries through Latin America, like Costa Rica, Colombia or Peru. That's one-third of the next steps. So, we will see what happens.Smith
Well, we'll be watching. Best of luck, Sebastian. Thanks for joining us on Better Heroes my friend. Thank you.Thank you all for joining me on this episode of Better Heroes. You can learn more about Balloon Latam at balloonlatam.com. And you can learn more about EY Ripples and all of our impact entrepreneurs at www.ey.com/eyripples. Links are in our show notes.
Please don’t forget to subscribe to our podcast, Better Heroes, wherever you listen to podcasts. You can also rate and leave our show a review to help others find out about the amazing work of our impact entrepreneurs. Before we go, we’d like to thank our podcast producers Hueman Group Media, who helped us bring this show to life (pronounced ‘human’).
That’s it for today’s episode. We’ll be back next week.
Music
Better Heroes is a project of EY Ripples, a global program to mobilize people across the EY network to help solve the world's most urgent social and environmental challenges. By extending EY skills, knowledge and experience to impact entrepreneurs on a not-for-profit basis and forging collaborations with like-minded organizations, EY Ripples is helping scale new technologies and business models that are purposefully driving progress toward the UN’s 17 sustainable development goals.The views of third parties set out in this podcast are not necessarily the views of the global EY organization or its member firms. Moreover, they should be seen in the context of the time they were made.
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