TIME Magazine

Better Than Charity

Posted Sunday, Dec. 11, 2005Some call the nonprofit organization that holds the hands of million-dollar business entrepreneurs crazy, but Endeavor CEO and co-founder Linda Rottenberg says, "That's when you know you're on the right track." Endeavor's 236 entrepreneurs so far--from Latin America and most recently from South Africa--would agree. Endeavor's approach of "catalyzing entrepreneurship," by merging microcredit and private equity with consulting support networks, is part of a broad effort to foster entrepreneurship in the developing world. Endeavor and others hope the companies they nurture will serve as examples for others to follow. So far, Endeavor projects have generated an estimated $974 million in revenue and 30,000 new jobs in seven countries over seven years. Rottenberg now wants to formalize entrepreneurial mentoring and encourage more women entrepreneurs.

This isn't charity, says Rottenberg, 37, and one might think she used the admissions standards at Yale University--her law-school alma mater--as a model for the rigorous skimming of entrepreneurial cream to determine who (with revenue exceeding $500,000) can turn four years of paid operating expenses, access to capital and local mentoring-network support into a story that will inspire.

Francisco Martinez filled the bill. As many as 30% of Endeavor's entrepreneurs don't reinvest in their communities, but Martinez, 41, who left school at 13 and later founded Neology, a Mexico-based radio-frequency identification (RFID) company, gives back. Neology, which has grown into a $20 million exporter from $300,000 in four years, has created hundreds of jobs locally and in San Diego. Endeavor has had limited success with women. But armed with a plan mapped out with Endeavor's help, Leila Velez, 31, is gaining access to loans that will help her grow her $4 million Rio de Janeiro hair-products company. Velez says Endeavor is redefining entrepreneurship for a new generation. A leading Brazilian dictionary will make that official by adding the Portuguese word for entrepreneurship, empreendedorismo, to its next edition--thanks to Endeavor's work.