Friday, March 27, 2015

North Korean entrepreneurs: Yes, they exist!

Warning: You are about to read a positive post (well, kind of) about North Korea. Reader discretion advised.

A couple of weeks ago, I had a unique opportunity to take some time off work*, and mentor North Koreans in an entrepreneurship workshop that took place in Singapore, organized by an NGO called Choson Exchange - for many hours over a 3 day event. It was one of the most interesting things I have done in my entire career, and I would like to share my experiences with you.

Before you, my dear reader, get all cynical on me, let me start by stating the obvious: I am no fan of closed, oppressive regimes that brainwash their population into believing in some alternate reality, and in particular not those who's ideology includes ethnic superiority and blood purity. My family has suffered greatly from such regimes - many members of the family of my grandfather was murdered by the Nazis in the 40s, my parents moved out of Apartheid South Africa in the 60s, and many members of my wife's family were murdered by the Khmer Rouge in the 70s. As an Israeli, I am also highly unhappy with North Korea's foreign policy that actively supports those who want to destroy my country. Finally, I also don't consider myself in particular politically naive or a media non-savvy. In my career, I have had sufficient opportunities to have a first row view of foreign policy scheming and media manipulation to grasp how this works.

Before attending this workshop, I went to consult with people I trust who know a thing or two about North Korea. None of them had anything positive to say. The warnings I received were in the range of writing off this workshop as yet another theatrical attempt of the regime to show off its superiority to the world, to concerns about this being a cover for the regime to recruit Westerners as spies.

Why was I drawn to attend despite all of this? It is because I have an allergy to black-and-whiteness. Every time a foreign reporter gets to visit North Korea, they feel compelled to feed the public thirst for sensationalist horror stories, and the story must fit with the accepted Western narrative of North Korea or it risks being written off. Reporters and visitors compete with each other in portraying a dark, darker and darkest view of the country. Now, having spent my life experiencing the huge gap between foreign media dramatized black-and-white projection of countries and the nuanced grey and far less sensational actual reality - of my home country Israel ; of Africa, where I spent a big part of my career ; as well as of my current country of residence, Cambodia - I have instinctive, intuitive distrust in the world media's reporting of actual life North Korea. Of course, North Korea's regime entire and complete lack of understanding of the free and open world media causes it to react to the negative reports of its country by trying to orchestrate even more carefully-controlled visits of foreigners and go out their way to make absolutely sure that foreigners are only exposed to the best aspects of the country and don't get to see anything negative - or indeed, talk to any regular North Koreans - which to the North Korean bewilderment, only results in even more cynical and negative reports of their country. This in turn feeds their paranoia and isolationism, and the cycle continues.

More than anything, I wanted to talk to real, intelligent, North Koreans, in an open, candid, unsupervised discussion. And that's what I got.

An open, personal discussion over dinner**
The 12 North Koreans that flew in to Singapore to attend the workshop are what we would describe in the corporate world as "middle management". They all had technical backgrounds (IT, biology, engineering). One of them was a professor at a university, three others were managing the creation of a technology park, while others were involved in distributing science and technology information in the country. All of them were reasonably well-traveled and were familiar with Google from using it while on their travels (and quick to admit it). At the workshop itself, they had unrestricted Internet access, and in their free time they were roaming around Singapore like any other tourist. 3 of the 12 spoke fairly good English.

I asked one of the participants, how does it feel to be a North Korean tourist in Singapore: "When I tell people I am from North Korea, they look at me like an alien from another planet".

I would describe the workshop as a "Introduction to Business 101". Each of the 12 came with a business idea they wanted to discuss. For some, it was an actual project they were already working on, while others viewed this as more of an academic educational exercise.

The participants were all aged 30-50, highly intelligent, very engaged, and the discussion was open, candid and personal. At times, there was even lively debate. We didn't touch on any sensitive topic or any specific technology, but rather just about entrepreneurship and how the global business and technology market works.

Some observations:

(*) The first thing that impressed me, and was in stark difference from my experience in other developing countries, is the high level of technical skills and ambitions, which is especially impressive considering the lack of free Internet access in North Korea (although there is some restricted access based on need or justification). For example, some of the projects they are planning include production of semiconductor photomasks and various fairly advanced image processing applications. They also had ideas around mobile applications for the domestic market considering that there are already 3 million North Koreans with mobile phones, and access to the national Intranet (but not to the global Internet). Essentially, it sounded like they had a lot of technical know how and were looking for commercial applications for their knowledge in order to build an export-focused industry, as well as start a digital economy locally in the country. As to how they acquired this technical knowledge and what were they working on previously, nothing was said.

(*) They are very proud of their national education system, that has a very strong focus on science and technology, from a young age. Sounded to me a lot like the Soviet Union at the time.

(*) One thing that became very clear, is that many of these highly intelligent people, who are busy creating businesses, don't have the first clue about what a business is. Specifically, while they have a reasonably good grasp of what it would cost them to execute their project, they really don't understand the concept of making money from selling a product or a service. In their mind, "seeking investment" for a venture, means asking for a budget that they can then spend on the executing the venture, without really thinking through the revenue part. They don't fully understand the concept that a business is a stand-alone entity that needs to make money to (at least) cover its costs, rather, they view it more as a public service that they need to deliver.

A heated debate over the design of the Technology Park

The technology park is a key part of the strategy

(*) Another thing that I observed, is while the participants were fairly familiar with the basics of the Internet, and keenly aware of the fact that their country is the only one left out of the Internet revolution, they still don't truly understand the power and value of unstructured, unrestricted access to information. When they think of information services (for the domestic market), they are thinking of structured services similar to 80s-era BBS or Minitel services.

An idea for an online B2B marketplace system for the local market

(*) Some of the topics that were discussed are similar to those of entrepreneurs everywhere:
- How do I protect my idea so big companies don't steal it?
- How do I present my idea so international investors will want to invest?

An idea for a car tracking system for the international market + demonstrating a misunderstanding of life in the West (not all of us have Ferraris...)

(*) North Korea is a "mobile only" county par excellence. There are currently 3 million mobile phones (and growing fast) and only 100,000 computers, almost none of them in private homes. Most of the phones sold today are based on Android. Most of the computers are running Windows, but there is now a government directive to switch all computers to Red Star (a local, secure version of Linux) due to security concerns. The cost of telecommunications is quite reasonable (about $4/month for a package of a certain reasonable amount of voice/SMS/data), although I didn't get a sense of the quality of the data service. The data service is of the national Intranet, without access to the public Internet.

An indoor navigation idea presented by one of the participants
(*) Electricity seems to be a big issue in North Korea - they get frequent power cut-offs even in the Technology Park which is supposedly a priority location.

(*) Salaries in North Korea (as presented in the business plans) are in line with other developing countries - starting at $100/month for unskilled labor to $1500/month for highly skilled labor (eg IT managers). 

(*) On the sidelines, I got a very passionate and emotional lecture on post-WW2 history of the Koreas from one of the participants, to whom it was very important that I hear the true story of their country. It was very interesting for me to hear their own national narrative. It goes something like this:
- The Koreans liberated Korea from Japan on their own at the end of WW2.
- After the Japanese already surrendered, America showed up and declared victory on the Japanese.
- America is interested in an unstable Korean peninsula so that it can maintain its forces on the peninsula, as a beachhead to China. That's why they are continuing their provocations such as the recent military exercise which is a simulation of an invasion to North Korea.
- The South Korean government is a puppet government of the US, and people in South Korea are effectively under American occupation
- We will never have a war on the soil of South Korea because that is part of our beautiful country, the South Koreans are part of our blood. That's why if we are forced to have a war one day, it is going to be on American soil.

To summarize, this was an extraordinary experience for me, and I get a sense that for the participants as well. The cultural and perception gaps between North Koreans and the rest of humanity are huge, but it is only through a personal, open dialogue that we are ever going to bridge these gaps - not through heated demagogy on either side.

Legal framework (in English!) for encouraging foreign investment
* Legal disclaimer to maintain the happiness of my colleagues at Google: my employer had absolutely nothing to do with this workshop and my participation was entirely in my personal capacity.

** The faces of the North Korean participants are hidden, at Choson Exchange's request, to protect their privacy