USAID’s new IDEA: Open for business (partnerships)

U.S. Agency for International Development Administrator Rajiv Shah speaks at the Feed the Future Research Forum. Photo by: Pat Adams / USAID

The U.S. government wants you to know: It is open for new, innovative partnerships with businesses from around the globe.

Last week, the U.S. Agency for International Development formally launched the Office of Innovation and Development Alliances as a point of contact for organizations interested in partnering with the world’s largest bilateral donor. IDEA’s goal is to reduce poverty, boost economic growth and help improve governance through a variety of mechanisms old and new — including the Global Development Alliance program, Development Innovation Ventures, and a variety of grant programs such as the Development Grants Program, Cooperative Development Program and Small Projects Assistance Program.

Devex spoke with Maura O’Neill, USAID’s senior counselor and chief innovation officer, about her vision for the new office she now heads, and how organizations can do business with IDEA.

What new does this office bring to USAID?

Let me put it in a little bit of a context. President Obama, in his presidential policy on development, said, let’s imagine the conditions where aid is no longer needed and let’s do it with economic growth; and we need public-private partnerships. So, this comes from the president and the Secretary [of State Hillary Clinton] and Administrator Shah saying, let’s reimagine.

As you know, we’ve done a thousand of these alliances over the last decades, but they’ve been more project-based. And so we said, we have an opportunity here to be more strategic. So, what’s new about this is that it combines some things that we’ve been doing for a while, but refreshes them in a very significant way, as well as adds things.

So, in innovation, we say, there’s new opportunities, new on-ramps to work with us. If you have a breakthrough idea that you think will scale, we’d like you to think about applying for a Development Innovation Venture, an adaptation of venture capital. That’s all new in the last year, and we’ve tested it out. So this is really significant. In one year we can make breakthroughs: That’s what that’s about.

On the public-private partnerships: They have been primarily at our mission level. But, we see these large companies — Cargill, Merck, others — say, we want to engage globally, on a more strategic level. And so, we have created two new groups.

One that is aimed at these strategic partnerships that are long-term, that are deeper, and more impactful for both the private company and for us.

And then the other part of it is what we call our GDA advisory services. Sometimes in the past, you really needed a Ph.D. in AID to really navigate. So we hope that your members will see the new IDEAS office as the point of entry that can help them navigate.

We don’t need to create the business development arm of your businesses, so we also know that what we’re looking for in partners is somebody who has assets or a business imperative about why they would be involved so that they bring something to the table that we can leverage against.

Will that make USAID a partner for a whole new type of organization?

Let me say that I’m really proud of the project-based alliances that we’ve done. So, this is not meant to either diss those or to say that we’re not going to continue to do them. We actually think that we’ll continue to do them. This is a new opportunity to engage. I think what will happen is that organizations in the U.S. and abroad will actually do much more comprehensive relationships with us and we with them.

The second thing is that there is a whole new group of companies that have never done business with AID — small, emerging companies, and even some of the new companies — Facebook, Twitter, even Google — that haven’t always been our traditional partners. We think that there’s a real opportunity to partner in a very significant way.

Are you looking for innovation in particular sectors?

The presidential priorities have been Feed the Future, which is our ag development, global health. But you’ll also see Administrator Shah give a keynote address on economic growth; so, entrepreneurship is something that’s been deeply important to the president, secretary and Administrator Shah.

As well as conflict zones. We have big efforts in stabilizing governments and democracies worldwide. We’re enormously proud of the work that we did to help South Sudan become a new country, and about as violent-free as you could have expected. In terms of the actual elections and transitions, we’re deeply involved in that.

What types of engagements are you looking for, and what’s the buy-in?

There’s about four, five different ways. One is the traditional way we’ve done business, which is that we put a competitive RFP out.

But we also have a special process: If you’re a small business, you need to get registered. Often, people don’t realize that that if a solicitation for small business comes out and they haven’t registered, it takes a couple months. So, I’d encourage your members to register.

There’s the traditional process, there are set-asides for small business, as well as big umbrella contracts in a certain area like agriculture, for which there are lots of opportunities to be subcontractors. There’s the Development Innovation Ventures that I mentioned — stage 1 proof of concept is a $100,000, stage 2 is $1 million, stage 3 is scaling to $15 million. Every quarter, we do a sweep of those proposals, and we encourage not-for-profits from the U.S. and abroad that have a breakthrough idea.

And lastly, there are the Global Development Alliances, which is where we’re looking for a leverage of at least one to one. Now, sometimes we’ve seen that there’s a three-way partnership: There’s a resource partner, meaning someone who’s willing to put up the money, and someone is actually going to do the implementation. So, if there is a member of yours that doesn’t necessarily have a match, they could potentially find another partner and we could do a three-way.

What else do you help organizations with?

We have deep country knowledge in 80 countries. So, we often play a really important convening role. So, if we understand what some of the objectives are of companies or organizations that would like to partner with us, sometimes much more valuable than our money is our relationships in country — so, our ability to show them the opportunities.

As I said, we don’t have the staffing and the expertise to substitute their business development arm. But we can help with deep country knowledge and opportunities.

Where do you see this office go amid funding worries on Capitol Hill?

I think there are no certainties in life about anything. But, having said that, this is a priority of the administrator, the president and the secretary. It is no coincidence that it reports directly to him [Shah].

He thinks of us as the Navy Seals, the forward troops of the agency that are not only leading in new innovative ways and new partnership, but also helping to show the rest of the agency about new ways of doing business and new business models. So, we think it is absolutely core to the future of USAID.

So, you’re open to partnerships with non-U.S. businesses?

Absolutely, in fact you will see over the next couple of months the administrator announce a major commitment to going through local systems in countries — so, that’s host countries, that’s for-profit businesses, that’s not-for-profits in the country.

We want to imagine the conditions where we’re no longer needed, and that’s through real sustainable development. And that is going to be by local organizations. We’re deeply committed to that. It’s a core feature of USAID Forward.

Some of the pilots that have been going on for a couple years now, on partnering more directly with host country civil society and business, what are the takeaways so far?

They have been just tremendous. Over the next couple of months, watch and you’ll see a whole new rollout. We piloted local capacity building in six countries. We piloted host-country direct relationship in a number of countries. We developed an assessment tool so that if we’re in a contract with a government, we know that it’s transparent, it’s got the capability to actually manage and carry out that development goal. This is a huge success story.

It’s a process. It’s a shifting of a super tanker. But it is probably one of the most important signature initiatives of USAID Forward, and specifically of the administrator. We’re having a worldwide mission directors meeting at the beginning of November, and this is a key discussion, by every single mission around the world, what’s being done on sustainability and working with local organizations.

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    Rolf Rosenkranz

    Rolf Rosenkranz oversees a talented team of in-house journalists, correspondents and guest contributors located around the globe. Since joining Devex in early 2008, Rolf has been instrumental in growing its fledgling news operation into the leading online source for global development news and analysis. Previously, Rolf was managing editor at Inside Health Policy, a subscription-based news service in Washington. He has reported from Africa for the Johannesburg-based Star and its publisher, Independent News & Media, as well as the Westdeutsche Allgemeine Zeitung, a German daily.