Ever since I came back from Cape Town, a question has been stuck in my head: Is poverty profitable? It’s an odd combination of two unrelated "P" words, but the more I think about it, the more I see how intertwined they are.
Poverty as a Business Model
The thought first struck me the moment we landed in Cape Town. Our driver casually mentioned that many tourists love visiting Langa, one of the townships, taking pictures, and experiencing “local life.” He said this as if it was a well-established business model—as if poverty itself had become a tourist attraction.
Later, during one of our research interviews, a passerby greeted us and, with a sarcastic smile, asked, “Are you from the UN? UNDP? WHO?” That one comment made it clear—Langa is not just another research site; it's part of an ecosystem. If you're studying poverty or social issues in South Africa, you come to Cape Town, and you come to Langa.
It made me wonder: Have townships been romanticized? Have we, as researchers, NGOs, and consultants, unintentionally turned poverty into an industry?
Think about it—organizations like Reciprocity or NairoBits exist because there’s a need to study and solve poverty. Consulting firms like Bridgespan or Dalberg thrive on advising organizations working on social issues. If poverty were to disappear tomorrow, what would happen to these entities?
And here’s the uncomfortable thought—what’s the incentive to actually solve poverty? If social problems are eliminated, many organizations will lose their purpose, their funding, and ultimately, their existence. It’s a paradox: we work towards a world without poverty, but the systems we’ve built to fight it rely on its continued existence.
This reminded me of a political debate we had a few weeks ago—politicians are rarely incentivized to create long-term progress. Their priority is the next election, not structural change. The same applies here. If there's no clear reward for ending poverty, does that mean there's no real incentive to do so?
Children as Catalysts for Systemic Change
The second big takeaway from Cape Town was something I already believed in but saw reaffirmed—long-term systemic change begins with children.
During a classroom discussion, I asked a group of students how they perceive waste pickers. Their responses were simple and clear: "They are normal, hardworking people who keep our cities clean."
But when I asked how the rest of their community perceives waste pickers, the tone shifted: "They are old, dirty, and only do it because they have no other choice."
It hit me—adult perceptions are deeply ingrained and difficult to change. Children, on the other hand, are more open-minded. Their views on social issues are still forming, making schools the ideal place to shape future mindsets.
This reminded me of India’s Swachh Bharat Mission. One of its most effective strategies was involving school children in promoting sanitation. Kids encouraged their families to use newly built toilets, which played a crucial role in reducing open defecation.
If we truly want to change societal attitudes towards issues like waste management, poverty, or inequality, we need to start with children..
Data Asymmetry and Exploitation
Another stark realization in Cape Town was how access to data—or the lack of it—creates systemic inequality.
In the community we were researching, many people were engaged in waste collection. When we asked about the rates at which they sell recyclables, we heard two drastically different stories.
One young woman was selling a single bag of tin for 300 Rand.
Another, a single mother, was traveling twice the distance and selling five bags for the same 300 Rand.
The difference? The first woman knew the market rates. The second one didn’t.
This wasn’t about hard work or effort—it was purely about information asymmetry.
It made me think about how access to data can be a powerful tool for equity. If there were a scrap market exchange, a public platform displaying fair prices, it could empower workers to demand better rates.
This connects deeply to my passion for data and technology. Transparency in data doesn’t just create fairness—it can democratize opportunities, reduce exploitation, and build trust in a system that is otherwise opaque.
Legitimacy: Who Decides What is "Formal"?
While talking about fairness, another question that emerged was about legitimacy.
We saw many informal, unregistered businesses creating real impact—helping their communities, providing employment, and filling gaps that formal institutions hadn’t. Yet, they were considered “illegitimate” simply because they weren’t part of a registered system.
On the other hand, formal businesses that did have access to credit and institutional support weren’t necessarily solving problems the right way.
So, who decides what is legitimate?
If an informal business is effectively solving a social problem, does its lack of paperwork make it any less valid? And if formality isn’t always a marker of trust or efficiency, should we be rethinking how we define legitimacy?
And most importantly—how do we empower these informal businesses without forcing them to fit into a rigid system that doesn’t serve them?
Final Thoughts
Cape Town was more than an academic trip—it was a lens into the world’s contradictions.
We work towards eliminating poverty, but an entire industry depends on its existence.
We want to change social attitudes, yet adults are often resistant, making children the best starting point for transformation.
We speak about fairness, yet a lack of data can mean the difference between survival and exploitation.
We value legitimacy, yet informal businesses solving real problems remain excluded from formal systems.
None of these questions have easy answers. But these are the thoughts that have stayed with me—uncomfortable, complex, and necessary to wrestle with.
And maybe, just maybe, acknowledging these contradictions is the first step toward finding better solutions.
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