Derick Davis spent two weeks this summer in a small beach town, learning about boats, deep-sea fishing, and wishing a food truck would deliver local cuisine. Before returning home, he took a side trip—to the Sahara Desert.
Davis, MA/MBA '12, was one of 16 graduate students who spent the summer in Tunisia, meeting with locals in underdeveloped places like Ghannouch, a coastal town of 25,000 people. The students identified business opportunities in the regions most neglected by the Ben Ali regime. Seven of them hailed from American University.
"The Arab Spring was not just about constraints on expression—it was also about a lack of economic opportunity," said Robert Sicina, an executive-in-residence at Kogod who organized the private sector initiative with help from IACE, a think tank sponsored by CEOs of Tunisian companies.
The students Sicina chose spent 15 days in each of 10 towns, meeting with everyone they could and holding training sessions on basic business skills. Their mission: identify at least three viable business ideas for each locale.
What counted as viable? To Liz Fleming, SIS/MA '13, a rating system helped. Her team measured five criteria for success, things like maximizing the number of potential employees and minimizing environmental impact.
At the Forefront
"I was especially interested in Tunisia because the Arab Spring started there," Fleming explained. What she discovered in Dahmani, not far from where a street vendor committed self-immolation on December 17, 2010: enduring tough times, and some hostility from citizens who were fed up with waiting for change.
A high unemployment rate, especially among young adults, was a common theme throughout the country.
Jason Smith, MA/MBA '13, described a "mismatch in education." At his very first site, Smith met young, college-educated electrical engineers who couldn’t find work. Despite their training, they didn't have the skills to succeed as entrepreneurs—to build a business plan, conduct a SWOT analysis. "This is a major challenge for entrepreneurship in the country," he said.
But is the lack of trained businesspeople a cause or effect?
The would-be entrepreneurs they met overwhelmingly thought money only came from government—"because that's how it always was [in Tunisia]," Davis explained. In the post-conflict country, other sources of funding are still warming up.
"We had to get them to understand that there are paths to getting investors."
Take the beachfront town, Ghannouch. Shipbuilding and fishing were popular, but fishing nets were hard to come by. Locals would buy them from the city of Tunis, a five-hour drive away.
"They all had the skill set to fix the nets, but no one was producing them locally," Davis said. "Cost differentiation would be one of their value propositions...they could produce nets at a lower price because of the lack of transportation costs."
A Country its Own
It was his interaction with locals that made Davis' experience stand apart. He would go out, drink tea, and play dominoes with his Tunisian counterparts to build a rapport. "There's a cultural component that you have to take into consideration," he said. "You have to be able to talk to the people around you...a lot of traditional business schools don't emphasize that."
Fleming was mildly surprised by the civil unrest—protests, strikes—that persisted. But "we never felt scared," she said. "It was exciting to be right in the thick of it all."
Although the strikes, she said, were annoying for the business owners, because they could not sell their goods. "People who are striking don't have jobs, but they don't realize [their actions mean] other people can't work."
Adaptation to the environment was required for the students, too. "You have to go with the punches," Davis said. "Things aren't always going to be how you would expect."
Smith thought visiting during the holy month of Ramadan was particularly memorable. "It was definitely a [logistical] challenge, but it was cool to see everyone come out at night in Makthar; when the sun goes down, things really happen. It gets to be pretty lively at night with the café culture."
Marble, Milk, Fruit
The final recommendations for each town ranged from pig farms to marble processing, honey harvesting to protective uniform manufacturing.
Pragmatism was the name of the game. "We didn't recommend 'start Facebook' or 'start Google' for your country," said Smith. "We played off the strengths and opportunities in each of the towns."
In Dahmani, Fleming and her team supported a community pool idea that came from a student. For a small fee, any resident could use the pool; the added benefit: it would keep kids busy and off the streets.
In Ghannoush, Davis' team suggested a food truck. The beach town had domestic tourists, but they brought food from home. A mobile food truck would have a low startup cost and could partner with local farmers.
In Al Ksar, a small city just outside Gafsa, Smith's team dreamed up a carpet manufacturing cooperative that would increase bargaining power for manufacturers.
The more sophisticated ideas will come stateside—metaphorically—this academic year, where new students in Sicina's Peace Through Commerce practicum will develop business plans. Sicina hopes for two dozen projects to enter Phase Two, either at AU or at other institutions he is recruiting.
Then the projects will again be turned over to IACE in Tunis, which will seek investors.
"There's no question that the path for funding is more solid than it ever has been before," Sicina said. "This link [to IACE] has got us into a network of potential investors who are going to make some of these projects real."
It’s also brought young American faces back to the country. Sicina noted that the Peace Corps. left Tunisia in 1995 and is just now returning. "Interior Tunisia has not seen American youth coming to help them in 15 years," he said.
"It can't stop with just us," Davis agreed. "If we're the only group, they're going to say...'They just came this once.' It has to be constant movement."