Back in TFN #34, we explored the topic of non-consumption, through the lens of Stripe and Paystack. I've subscribed largely to the Patrick Collison and Shola Akinlade school of thought: if you build it, they will come. In that piece, I quoted Patrick from the New African Renaissance conference in 2020,

People that are doing analyses of businesses or opportunities, they tend to be very focused on what currently exists… in management consulting style thinking, it’s harder to reason about what could be happening if it was easier or what might be the case in ten years… 

He went on to tell a story of the experience Stripe merchants had when they started to support WeChat and Alipay payments. Merchants thought they didn't need to support these payment options because they didn't have many customers in China. In actuality, they didn't have many customers in China because they didn't support these payment options.

I was reminded of that insight while recently reading Rest of World's How a YouTube channel is transforming a remote village in Bangladesh. It tells the story of the YouTube channel AroundMeBD - showcasing food culture and life in the village of Shimulia - which has garnered over 4 million subscribers and 1.36 billion total views.

The authors write, "the channel has adopted a rustic, practical visual style… the videos, depicting a community kitchen in Shimulia producing gargantuan quantities of food, are extravagant: meals include 14 full goat intestines, 50 country ducks, a 185-pound vanilla cake, or a 650-pound water buffalo."

What so intrigued me about this story, in the first place, was the new economy that was developed to support the operation of this channel - and of the internet creating economic value in remote villages despite the village itself having limited internet.

To plan the shoots and manage the crowds, the channel employs around 50 people, including 17 women. Merchants and logistics providers in the region are benefactors, as well:

Producing videos for the channel comes with considerable expenses: crews spend about Tk 1,000,000 (~ $11,630) on video production every month, with the lion’s share of that spent on sourcing ingredients, which can include exotic meats like lobster, swordfish, and buffalo tongue. Khan says that on average, the channel uses Tk 300,000 (around $3,500) worth of fish every month. Up to Tk 15,000 (around $175) is spent every week on transporting the massive amounts of meat. 

And proceeds from the YouTube channel have also been used to directly fund the medical expenses of the elderly, to distribute food and other household necessities to those in need, and to build community works like a giant straw elephant water slide (the making of video has garnered over 20 million views).

But Shimulia has limited internet connectivity. SD cards with footage from the village are sent to Bangladesh's capital, Dhaka, via public bus - a six-hour trip that can take more than 12 hours in the winter. So the community is, in effect, a digital economy without much digitization itself.

To what extent does this example turn economic development and job-creation models on its head?

Infrastructure Push vs. Pull

The classic development strategy stipulates that infrastructure - roads, electricity, internet access, etc. - leads to economic development. But several studies show that to not necessarily be the case. The accessibility of electricity in rural environments, for example, does not change the affordability of electric appliances, nor does it necessarily lead to an increase in electricity demand. The GSMA's tracking of internet connectivity tells a similar story - while the coverage gap continues to narrow, the usage gap remains wide. Those who live in areas with a mobile broadband network but are not using mobile internet is 43 percent, or 3.4 billion people worldwide.

In The Prosperity Paradox, authors Clayton Christensen, Efosa Ojomo, and Karen Dillon write about this push and pull of infrastructure. Push approaches attempt to foster country development by promoting resources in anticipation of future use.  But these push attempts have often failed without a market to sustain the infrastructure. The story of Efosa's charity, Poverty Stops Here, which built wells in poor Nigerian communities, is a common one when it comes to these types of development projects:

built several water wells in poor Nigerian communities, but after a few months of operation, virtually all of them broke... Interestingly, much of the development industry is still focused on building or providing resources in poor communities across the world with far less focus on maintaining them... The fact that resources are vulnerable to depreciation doesn’t mean the development industry should stop providing or using them. It simply means they should be provided in a way that allows them to be fixed when they break. This is where market-creating innovations have tremendous power and potential. 

Market-creating innovations pull in new infrastructures and regulations to service a new market's needs, in an environment in which there is a market to sustain new infrastructure. The development of infrastructure is necessarily reactive. As the authors argue, "nonconsumption is the result of the inability to purchase and use a product or service required to fulfill an important Job to Be Done". But creating the ability to consume does not automatically create demand if there is no Job to Be Done.

Which brings us back to Stripe, Paystack, and YouTube village.

Stripe - in the case of Chinese payments - and Paystack were themselves pulled infrastructure that, once built, unlocked a wider market opportunity than people previously thought possible. Meanwhile, the mobile internet usage gap in emerging markets remains high because it's a push onto consumers.

Whereas if (or when) more robust connectivity gets built in Shimulia, Bangladesh, it will be pulled in to service the operations of an economy that's been built around AroundMeBD. By leveraging the power of the internet - and, in particular, aggregators like YouTube that create a global reach for content, no matter how niche - without first building the infrastructure, there are now market conditions that may allow for the sustainability of said infrastructure. It's effectively an asset-lite development model.

Now, I'm not saying that the answer to the rural development question is that every village starts a YouTube channel. But in the context of an increasingly daunting challenge - that of the future of work, and of job- and revenue-generating opportunities for Africans in the context of staggering population growth - it's imperative, in my opinion, that the solutions to this challenge include "all of the above".

Whether it's content creation or play-to-earn gaming or other yet-to-be-imagined concepts, the future economic development models are going to look more diverse and less traditional than ever before. And for that, YouTube village is an important case study to draw inspiration from.

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✌️ Justin

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