Today’s blog was contributed by Oyihoma Saleh from the Global Prosperity group.
Bill Gates’ recent commitment to spend $200 billion over the next 20 years through his foundation exemplifies the kind of bold action development funders can take to deploy catalytic capital at transformative scale. Yet, as Efosa Ojomo suggests in a recent piece, to truly maximize the impact of $200 billion, a larger share of those resources must go beyond traditional aid approaches and be directed toward building market-creating enterprises.
Development funders, including large philanthropies, bilateral aid agencies, multilateral development banks, and impact investors, play a pivotal role in shaping the trajectory of growth in low and middle-income countries. Unlike private-sector investors, these funders often have the mandate and capacity to absorb early risk, finance experimentation, and mobilize broader capital that unlock opportunities traditional markets overlook. When directed strategically, their capital can build the foundations of inclusive, long-term prosperity.
Market-creating enterprises target nonconsumption—the inability of a person to purchase and use a product required to help them make progress—by turning complicated, expensive products into simpler, more affordable ones that many more people can access. In doing so, they create new markets, generate jobs, expand tax bases and build inclusive wealth, forging a sustainable pathway to prosperity.
However, when deciding to invest in these kinds of enterprises, a core challenge is determining which opportunities have the greatest potential to transform nonconsumption into self-sustaining markets. To help answer this, we have researched and determined a practical set of factors that funders can analyze when assessing market-creating opportunities. Factors that look past inspiring stories to the conditions required for innovations to take root and scale.
Below are 8 factors any funder can use to judge whether investing in an opportunity can unlock nonconsumption and deliver transformative impact:
- Size of nonconsumption – Consider the number of people that go without a needed product or service because none on the market are affordable, simple or convenient. The larger the number of nonconsumers, the greater the potential for large-scale impact.
- Intensity of struggle – Understanding how difficult it is for people to make progress in their given circumstance can help predict the rate at which a solution would be adopted. The more acute the struggle, the more likely people will rapidly adopt a new offering that meets their needs even if it is imperfect at the onset.
- Market value – Estimating the total economic potential of the opportunity shows the value that could be unlocked if the innovation successfully reaches nonconsumers. A high market valuation signals greater room for growth, scale, and long-term sustainability of the enterprise, while also attracting investors with stronger prospects for financial returns.
- Projected tax contribution – The potential fiscal contribution to government revenue through taxes generated by the new market can help demonstrate how the opportunity strengthens public finances and supports further development. This is important for attracting government buy-in. Examining value-added tax exemptions and other tax incentives is also critical to accurately assessing the true scale of potential tax contributions
- Number of jobs created – Job creation is a critical pathway to poverty reduction and economic growth. Quantifying the number of both direct and indirect jobs created across the value chain as a result of the new market signals its potential to drive inclusive prosperity.
- Ease of upskilling – Assessing how quickly and affordably workers can be trained to perform required roles ensures new jobs created can actually be filled in the near term. Higher ease of upskilling lowers execution risk and costs, accelerates scale, and broadens inclusion by enabling more people to participate in the new market.
- Government policy – Examine the extent to which existing policies enable, support, or hinder the opportunity’s success. Alignment with policy priorities can accelerate adoption, while policy barriers can slow or even block market creation in some settings.
- Entrepreneur and investor appetite – Evaluate existing level of interest and willingness of entrepreneurs and investors to engage in the opportunity. Strong private-sector appetite signals higher chances of attracting additional capital, expertise, and innovation energy to scale the market.
Taken together these factors ensure that the opportunity aligns with the principles of market creation, prioritizes scale and financial sustainability, advances inclusive prosperity through jobs and skills, and fosters an enabling environment for adoption and growth.
For development funders, the task is not simply to deploy capital generously, but to deploy it wisely. By systematically assessing opportunities against these eight factors, funders can move beyond short-term interventions and begin building the engines of inclusive prosperity: markets that generate jobs, expand tax bases, and equip people with the tools to improve their own lives. In doing so, they not only amplify the impact of each dollar invested but also help lay the foundations for long-term economic resilience and shared prosperity in the regions that need it most.
For examples of how this framework can be applied, read our “Unlocking Opportunity” series on market-creating innovations in Nigeria:
Unlocking Opportunity: A New Vision for Eyecare in Nigeria
Unlocking Opportunity: Diagnosing a Market Gap in Nigeria
Unlocking Opportunity: How Poultry Can Catalyze Prosperity in Nigeria
Unlocking Opportunity: Pharmacies for better health
Unlocking Opportunity: Solar and the power of nonconsumption in Nigeria
Unlocking Opportunity: Why mobility is key to Nigeria’s prosperity
Unlocking Opportunity: Tapping into Nigeria’s unmet dairy demand
