How urban entrepreneurs can help build sustainable cities

31 October 2022

Marking World Cities Day on 31 October, UNCTAD shines a light on how urban entrepreneurs can help make cities and human settlements inclusive, safe, resilient and sustainable.

A hydroponic farmer harvests vegetables in his solar-powered garden on the roof of a building in Bali, Indonesia.
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© Shutterstock/Pande Putu Hadi Wiguna | A hydroponic farmer harvests vegetables in his solar-powered garden on the roof of a building in Bali, Indonesia.

A new report by UNCTAD explores how urban entrepreneurs, or urbanpreneurs, use innovative solutions to tackle challenges triggered by rapid urbanization and drive the expansion of smart cities.

The report entitled “Urban expansion, an entrepreneur’s playground”, published on 31 October, showcases replicable examples of urbanpreneurs worldwide tackling the socioeconomic and environmental challenges associated with ongoing rapid urbanization.

By 2050, nearly 70% of the global population will live in urban areas, putting to the test the capacity of cities to accommodate them.

“Entrepreneurs are stepping in to help cities meet the needs of their rising populations,” said Arlette Verploegh, who leads UNCTAD’s entrepreneurship development team that produced the report.

 “As game changers and innovators with strong roots in their cities, they see first-hand the challenges that exist. These urbanpreneurs are in a good position to offer solutions,” Ms. Verploegh added.

Driving sustainable urbanization

The report highlights the contribution of micro, small and medium-sized enterprises (MSMEs) in boosting innovation and creating jobs, especially in developing countries.

It points to urban farming in Johannesburg, South Africa, to illustrate green entrepreneurship and business ingenuity.

There, urbanpreneurs transform underutilized rooftops into farms, hire locals to produce food sourced from the city and work with partners to scale up green infrastructure.

“Fostering entrepreneurship and innovation for urban development is important and can inspire more business-led innovations for resilient and sustainable cities in the future,” the report notes.

Empowering communities

When it comes to urban problem-solving, urbanpreneurs take advantage of networked ecosystems, powered by greater internet connectivity and digital resources that cities can offer.

In Sao Paulo, Brazil, a local fintech start-up is making a difference in a slum by improving financial literacy, expanding financial inclusion, facilitating MSME credit for its dwellers and helping them access loans with lower interest rates.

In Subang Jaya, Malaysia, urbanpreneurs are helping mom-and-pop shops – small, family-owned retailers – embrace digitalization. Such MSMEs account for about 97% of the country’s businesses, with many needing help to implement digital technologies.

Thanks to local entrepreneurs, more MSMEs can digitize their operations, better manage their inventories and get financial assistance.

Leveraging multistakeholder collaboration

Modern cities embrace collaboration as a fundamental principle for growth, the report says.

Innovative partnerships among entrepreneurs and other city stakeholders, including universities, policymakers and enterprise development centres such as incubators and accelerators, are accelerating the rise of city clusters. 

Built on collaboration, a new Pan-African digital hub in Kigali, Rwanda, is boosting entrepreneurship and the city’s overall competitiveness, thanks to readily available information, talent and capital.

In Monterrey, Mexico, a networked business ecosystem that prioritizes innovation is rapidly emerging, enabling urbanpreneurs to pool knowledge, technology and resources.

The Tecnológico de Monterrey System is a government-backed collaborative venture connecting businesses and educational institutions.

With a digital future in mind, it aims to spur economic growth by awakening students' entrepreneurial spirit and enhancing cooperation between start-ups and other firms.

Success ingredients

The report outlines how cities can better leverage the power of entrepreneurship.

It calls on policymakers to attract urbanpreneurs – by nurturing talent and making resources available – and recognize them as partners in addressing urban challenges.

It underscores the need to create a collaborative, multistakeholder ecosystem in which new technologies are harnessed to tackle the challenges of rapid urbanization.

Amid uncertainty and global crises, the report says, cities with strong collaborative foundations have the potential to become fertile grounds for entrepreneurs to do what they do best: innovating to promote community wellbeing.