strategy+businessThe Fortune at the Bottom of the Pyramidby C.K. Prahalad and Stuart L. Hartfrom strategy+business issue 26, frst quarter 20022002BoozAen!amiton"n#$Arightsreser%ed$e-Doc&'()*"T+A,-&T*AT'.+at theof theby ($/$ Prahaad and &tuart 0$ !artLow-income markets present a prodigiousopportunity for the worlds wealthiestcompanies to seek their fortunes andbring prosperity to the aspiring poor.11ith the end of the (od 1ar, the former &o%ietUnion and its allies, as well as China, India, and LatinAmerica, opened their closed marets to !orei"n in#est-mentinacascadin"!ashion.Althou"hthissi"ni$canteconomic and social trans!ormation has o%ered #ast new"rowth opportunities !or multinational corporations&'(Cs), its promise has yet to be reali*ed.+irst, the prospect o! millions o! ,middle-class- con-sumers in de#elopin" countries, clamorin" !or products!rom'(Cs,waswildlyo#ersold..omaemattersworse,theAsianandLatinAmerican$nancialcrisesha#e"reatlydiminishedtheattracti#enesso!emer"in"marets.Asaconse/uence,many'(Csworldwideslowedin#estmentsandbe"antorethinris0rewardstructures !or these marets. .his retreat could becomee#enmorepronouncedinthewaeo!theterrorist#ontentstrategy&competition"

ustrationby2ar#o3enturaThe FortunePyramidBottomattacs in the United States last September..helaclusternatureo!most'(Cs1emer"in"-maret strate"ies o#er the past decade does not chan"ethema"nitudeo!theopportunity,whichisinrealitymuch lar"er than pre#iously thou"ht. .he real source o!maret promise is not the wealthy !ew in the de#elopin"world, or e#en the emer"in" middle-income consumers2Itisthebillionso!aspiringpoorwhoare3oinin"themaret economy !or the $rst time..hisisatime!or'(Cstolooat"lobali*ationstrate"ies throu"h a new lens o! inclusi#e capitalism. +orcompanieswiththeresourcesandpersistencetocom-pete at the bottom o! the world economic pyramid, theprospecti#erewardsinclude"rowth,pro$ts,andincal-culable contributions to humanind. Countries that stilldon1tha#ethemodernin!rastructureorproductstoC.K. rahalad4#5rahaad6ao$#om7 is the!ar%ey ($ Fruehauf Professorof Business Administration atthe )ni%ersity of 2i#higanBusiness hoo, Ann Arbor$!e is aso the founder and#hairman of Pra8a "n#$, a5ioneer #om5any in intera#ti%ee%ent e95erien#es, based in&an -iego, (aif$!tuart L. "art4shart6un#$edu7 is 5rofessorof strategi# management,&arah .raham /enan-istinguished hoar, and#odire#tor of the (enter for&ustainabe 'nter5rise at the)ni%ersity of ,orth (aroina:s/enan;Fager Businesshoo$meet basic human needs are an ideal testin" "round !orde#elopin" en#ironmentally sustainable technolo"iesand products !or the entire world.+urthermore, '(C in#estment at ,the bottom o!thepyramid-meansli!tin"billionso!peopleout o!po#erty and desperation, a#ertin" the social decay, polit-ical chaos, terrorism, and en#ironmental meltdown thatis certain to continue i! the "ap between rich and poorcountries continues to widen.Doin"businesswiththeworld1s4billionpoorestpeople 5 two-thirds o! the world1s population 5 willre/uireradicalinno#ationsintechnolo"yandbusinessmodels. It will re/uire '(Cs to ree#aluate price0per!ormancerelationships!orproductsandser#ices.Itwilldemandanewle#elo!capitale%iciencyandnewways o! measurin" $nancial success. Companies will bestrategy+businessissue26#ontentstrategy&competitionthe risin" middle classes in de#elopin" countries, the tar-"ets o! '(Cs1 past emer"in"-maret strate"ies.(ow consider the 4 billion people in .ier 4, at thebottom o! the pyramid. .heir annual per capita income5 based on purchasin" power parity in U.S. dollars 5is less than 67,899, the minimum considered necessaryto sustain a decent li!e. +or well o#er a billion people 5rou"hly one-si:th o! humanity 5 per capita income isless than 67 per day.;#en more si"ni$cant, the income "ap between richand poor is "rowin". Accordin" to the United (ations,the richest ?9. In