Governments around the world should look to startups to solve social problems more efficiently, according to investment firm Omidyar Network.
Startups can provide services to government in a more cost effective way said Stacy Donohue, investment director at the company.
During a panel session at the Open Government Partnership in London today, a group of startups and investors discussed how governments across the globe could make their social projects more efficient using startup organisations.
Donohue said the US government has made it part of its agenda to embrace startups, and other governments should follow its lead. “It was seen as risk taking within government," she said. “The perception was that using larger companies mitigated risk, but in fact the opposite may be true.”
She said governments should begin by working with startups on small projects, with small contracts, to see the return.
More on startups
Alejandro Maza, co-founder of the startup OPI in Mexico, which aims to rebuild trust between citizens and politics, said government employees with a background in academia or the private sector are more willing to innovate and accept risk. “This has enabled them to hire startups instead of huge companies,” he said.
He advised startups not to pitch a new, radical idea to government bodies, but to start with little success stories and scale up.
The aim of the Open Government Partnership Summit is to connect world leaders in the spirit of transparency within government, in line with open data.
During this panel session, startups demonstrated how their technologies help to solve social problems in their countries.
Supporting social issues
OPI supports citizens who want to voice social issues to the Mexican Government. Using statistical data tools, OPI aggregated opinions from Facebook, Twitter and video and provided this information to the government, who sometimes would not act on it, which disappointed the citizens who took part. Maza said they changed their model to make it more transparent so both government and citizens could see the issues raised, they then began charging the government for more details of the data which made it more valuable and actionable.
This enabled the company to hire talented employees and improve their technology tools, which Maza said could never have happened with a non-profit model.
Another startup, Spacial Ideas from India provides a solution to visualize data from social problems. They used the technology to tackle areas including health, sanitation, food and infrastructure problems using biometrics, business intelligence, mobile applications and geographic information systems.
Spacial ideas used technology to tackle health, sanitation, food and infrastructure problems
The platform they produced increased waste collection by 10% by tracking employees using facial recognition technology. In a country with a significantly high infant mortality rate it also helped health workers to track pregnant women and children who need vaccinations, saving the government millions of dollars in the process.
Also on the panel, was Paul Miller, MD of Bethnal Green Ventures, an accelerator programme based in London that works with tech startups who solve social and environmental problems.
He said he had seen a trend in recent years to more openness in the UK government to use startups. “They’re generally getting better and better, but slowly,” he said.
He said startups should find the right person within government who wants to achieve change and then the startup becomes a lobbying tool.
One of the startups that came out of Bethnal Green Ventures, Dr Doctor, did exactly that. The startup aims to use technology to provide a more efficient system to schedule appointments in the health sector. Miller said they found the right person at the first hospital who brought them on board, and that person recommended the platform to another institution.
Miller also said the UK government should be clear about its problems, and the problems that are specific to particular agencies. Government can then work out how to work with companies to solve those problems, he said.