Diaspora communities invest
Diaspora communities are important: they are significant political lobbies, essential support networks, and a critical source of aid to their home countries through remittances. Diaspora communities can make important contributions to development and peacebuilding. Understanding the pivotal role of diaspora communities is the easy part. What’s difficult is finding members of diaspora communities, connecting them and effectively harnessing their motivations to help their home countries.
It is this difficulty that inspired Molly Mattessich of Africa Rural Connect and Homestring’s Eric-Vincent Guichard, the presenters at Tuesday’s event hosted by Microlinks about “Connecting to Diaspora Communities Through Web Portals.”
Africa Rural Connect was developed by the National Peace Corps Association in 2009 to address major rural agricultural challenges in Africa with the help of rural African farmers, especially women. The site functions as a meeting place for members of the African Diaspora, people in Africa, and people connected to the Peace Corps. On the site, people can “offer,” “remix,” and “endorse” ideas in addition to “pledging” money or time to events they like the most, though no financial transactions take place on the site. Through periodic competitions, the most popular ideas win cash prizes. Measuring the impact of the ideas generated on the site is hard because Africa Rural Connect does not follow their progress. It can report that there have been over 20,000 profiles created from 130 countries. About a third are members of the African Diaspora, another third live in Africa, and a final third are academics, people in the development field and entrepreneurs.
Homestrings uses a different approach based on the desire of members of the African Diaspora to invest in their homelands. Roughly $450 billion in remittances is sent from the West to emerging markets each year. Of that, Homestrings figures ten billion dollars per year comes from members of the African Diaspora looking to invest in Africa. Homestrings overcomes barriers diaspora communities face in investing at home by providing a credible, transparent, professional, and customer-oriented investment platform. A study prepared by George Washington University in collaboration with USAID and Western Union concluded that contrary to popular opinion, diaspora communities want to invest in their home countries not just for emotional or political reasons, but because they hope to get a return on their investment. The most often reported way diaspora communities connect with their homeland is through the internet. Homestrings offers a web-based investment platform where potential investors can find projects, endorse or invest in projects they like and manage their investments. Since February of 2012, Homestrings users have invested over $25 million. Homestrings plans to expand to Asia and Latin America.
Peacebuilding is expanding. Research, like the report considered in this post, indicates that intelligent development efforts are often necessary components of work to make and maintain peace. Using the internet to help diaspora communities invest shows promise.
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