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Noah Samara didn't set out to start a business. As the Ethiopian-born founder and CEO of WorldSpace Corporation, Samara explained during his keynote talk at HBS that his business actually began because he'd been reading the newspaper.
The Washington Post, Samara told the audience, was running a series of articles about the spread of HIV/AIDS in Africa. The articles predicted a calamity if nothing was done.
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| When my wife heard that I was leaving my job to launch a satellite over Africa, she thought I was crazy. But I knew I was crazy. | |
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| —Noah Samara |
"I felt Africans were really not dying from a disease," Samara said. "They were actually dying from ignorance."
The articles so disturbed him that he became convinced of the urgent need to deliver information over vast areas of the continent efficiently, economically, and actively. It would be much too slow to distribute written information; and satellite television was not an answer, either: Satellite TV programs would only reach Africans who already had electrical power and lots of money to access the service.
The only solution that made sense, he realized, was to develop a wireless, digital audio and multimedia program service that would reach Africans in their homes, through small, portable receivers. Such a service would aim for people who couldn't count on adequate radio reception otherwise, and who lacked a choice of programs. The idea, he believed, was "economical, practical, and most of all, doable."
"There is an African-American saying," Samara said at HBS. "'If it's going to be, it's up to me.' I became an entrepreneur because I absolutely had to. I had to."
"The nicest things"
A lawyer as well as the holder of two master's degrees—one in international business, the other in Renaissance Reformation history—Samara was advising companies that used satellites when he first scribbled the idea for WorldSpace on a napkin. He drew up a two-page overview and then a formal business plan, and embarked on the search for capital.
He pitched his idea to government agencies, banks, and non-governmental organizations (NGOs). They pronounced it "brilliant," according to Samara. "They said this was a great way to tap Africa's underserved market. They said the nicest things. But none of them would step up to the plate."
There were other hurdles, he conceded. He had no money, no technology, no partners, no regulatory authority to operate the service, and no frequencies to operate the service on a global basis. Despite the odds, however, he battled to get seed capital and succeeded.
"When my wife heard that I was leaving my job to launch a satellite over Africa, she thought I was crazy. But I knew I was crazy!" he told the HBS audience with a grin.
In October 1998, his new company launched its first satellite: the first one in history, he said, designed and launched expressly to serve Africa. In 2000, they launched Asia Star, a satellite for Asia. This year, "if the markets are good to us," they will launch a third.
African solutions
Through receivers by Hitachi, JVC, Panasonic, and Sanyo, WorldSpace delivers exclusive branded channels of music. ("You want Miles in Mambuto? Nirvana in Nairobi?") WorldSpace has sold about 70,000 receivers so far, at a cost of $200-$600. Subscriptions to the branded channels cost $10 per month. The business model is not to sell receivers, Samara stressed, but rather to build on revenue streams from leasing, advertising, and subscriptions, all of which are linked to market penetration.
In addition to the music channels—covering jazz, rock, urban contemporary, Western classical, and "the best of music from all over Africa"—his company dedicates five percent of its capacity to create educational programming in partnership with 60 NGOs throughout Africa. The initial inspiration for WorldSpace—trying to stem the tide of HIV/AIDS—is being assisted through "lots" of public service announcements, he said. Samara added that he's trying to get partners together to host a concert that would be broadcast across Africa, interspersed with public service announcements that remind people to "Pass the message, not the virus."
Acknowledging the devastating effect of colonialism on the psyche of many Africans, Samara said it is vital to look to the future rather than the past to create solutions for African problems. "There are things that are immediate and absolutely necessary. That should be our objective," he told the HBS audience.
Asked for advice on how to raise money for technological businesses, Samara admitted, "It took me five years. We raised $1.1 billion and we're still looking for money. And it's the worst time to look for money.
"I never said to myself, 'Wow, I need to raise a billion dollars. How the hell am I going to get a billion dollars?' What actually went through my mind's eye was, 'All the money in the world. Trillions.'
"I couldn't even count how many trillions of dollars there are in the world," he recalled. "And I thought, 'What I want is just a billion out of that.'
"It all depends on how you look at it. There is money out there."
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