Friday, May 05, 2006

Antrepenori la Falesti si la Mereseni

In part of my travels during the week-long Easter vacation, I visited three volunteers, Levi, Priya and Mark, in the north-western city of Falesti. Falesti is a county seat and a relatively large town. It has its own restaurants, monuments and internet cafes. It seems more developed than my county seat of Hincesti, most likely because Hincesti is only 30 minutes from Chisinau, as opposed to the two- to three-hour ride from Falesti to the capital; when it's not as easy to slip into Chisinau for your fun, you have to create everything in your own town. From a volunteer's perspective, having sources of entertainment, not to mention other Americans, in Falesti makes for a very different Peace Corps experience than my village life.

Mark, one of the volunteers in Falesti, specializes in business and agriculture. It has allowed him to meet both agricultural businessmen and younger entrepreneurs in other business sectors. One such entrepreneur is Sergiu, who served us some excellent barbecue and played baseball and American football with us on my first evening in Falesti. The next day, Mark, Levi and I went to visit Sergiu's business, an internet cafe. There were 12 computers, all with LCD monitors, Windows XP and fast enough processors to play the newest games. Two customers were using the internet, one kid was playing a first-person shooting game, and Sergiu's son was playing a Starcraft-like war game. This was a better set-up than at the public internet access terminals at Moldtelecom, the government-owned telecommunications company.

My first question to Sergiu was, "How did you have the money for this?" He told me he had done it with help from a World Bank program for entrepreneurs under age 30. With $1,000 of his own seed money, he was able to obtain a grant for $5,000 and another $4,000 as an 18.5% interest loan over the course of three years (the maximum-term loan legal in Moldova). He charges one leu, or about eight cents, for 10 minutes of internet usage or 15 minutes of game playing. His current overhead cost for DSL scales with usage, so by my estimate, he breaks even or makes a slight profit on internet, and will make more of a profit on it when the infrastructure improves and costs decrease. Where he really makes his money, however, is in kids who play games. If you're a kid who has 3 lei in your pocket on your way home from school, you can either buy half of a candy bar or blow up your friends in Unreal Tournament for 45 minutes. And what are the
overhead costs for Sergiu when kids play games, which, like it or not, are all pirated? Zilch.

"The real money is in online role-playing games like Everquest," Mark told me as he sat at the main computer. "When someone gets hooked on one of those, he's in here every day using the internet for a couple
hours." Mark often runs the internet cafe in Sergiu's place for a few hours, and in exchange he has free rein of the place.

I was very impressed with Sergiu, and knew that if I could find someone like him in Mereseni, I could bring modern computers and the internet to my village much faster than trying to find grants to bring computers to the schools. Having this technology at an internet cafe also would make it more sustainable than at the school, because an entrepreneur would have an economic interest in keeping the computers in good condition and in providing as fast of an internet connection as his customers demanded. I got the number of Sergiu's contact at the World Bank's Chisinau office, left the cafe and began thinking of my next steps.

This Tuesday, I went to the primaria, or mayor's office, described my project to the mayor's secretary and asked her if she knew of any villagers who would be interested in this project. She gave me the name and phone number of a man named Nicolae, a 28 year old who owns his own construction company and has recently purchased the old dilapidated bath house. Sure, he was a stranger to me, but she told me where he lived and who his mother-in-law was.

I talked with Nicolae's mother-in-law, a teacher at the school, and she told me to come to their house on Wednesday evening. As I was walking the final 50 feet to the house that evening, a car pulled up to me and a man whom I recognized stopped next to me.

"You're coming to my house, right?" he said.

"Oh, that Nicolae," I thought to myself. I had previously met him at Ziua Absolventilor, the high school reunion, a few months ago. It had been his wife's five-year reunion then, and he and I had talked for a while. We had met another time at my vice-principal's house. Suddenly, this "stranger" whom I was going to meet was someone with whom I had already had a couple conversations. I
hadn't been sure how to choose my words in selling this idea to him, but now that he wasn't a stranger, things were much easier.

He invited me into the kitchen of his house, which was the nicest house I've been inside of in my village, complete with running water and a radiator system running through both stories of the house. Houses in Moldova have two types of doors: the homemade slabs of wood that never quite close correctly, and the new, clean, manufactured doors that you find in houses made or remodeled in the past five to 10 years. Nicolae's house had the new kind, and those doors announce that the person living there has made good money at some point in the last decade.

Over a cup of tea and some coffee cake, Nicolae told me about his plans for the building he had bought, which is next to his house. He estimates that construction on most of the building will be completed in a month, at which point he can open a construction materials
store. Needless to say, there is no Home Depot in Mereseni, so when villagers buy construction materials (which is often, since nearly every family here builds its own house and does its own renovations), they have to pay to transport the materials back to the village, significantly adding to their costs. Because Nicolae already buys
materials in huge quantities from Chisinau for his construction company, he can sell extra materials to villagers for a profit. It's a win-win; he gets to make a profit selling materials that his company might not otherwise use, and villagers save money by buying locally and saving transportation costs. There's even a third win, since the money is not going to a businessman in Hincesti or Chisinau, but rather it is staying here in Mereseni.

In another two months, Nicolae told me, the other parts of his building will be complete, containing a cafe/bar that he hopes will have a nicer atmosphere than the one other bar in town, and yes, an
internet cafe. The internet cafe will be a huge money-earner, he reasons, since it is practically next-door to the school. When students finish school at 2:05 and have an hour before they're expected home, they'll plop down two lei for a half-hour of Counter-Strike without thinking twice.

I gave Nicolae the phone number of Sergiu's World Bank contact, and we also exchanged cell phone numbers. Regardless of whether the World Bank helps him, Nicolae will eventually have an internet cafe in his building, and I look forward to helping him with the process.

America prides itself on its entrepreneurial spirit, and President Bush consistently notes that much of the growth in the American
economy in the past 20 years has been from small businesses. Because of Moldova's communist past, that same spirit is lacking in this country; Moldovans like to grouse about how the government never does anything right, but they accept authority from the top and rarely innovate from below or plan at a grassroots level. I was sucked into this idea for nearly the entire first year of my service, thinking that the improvements that would serve the village best would be bringing heat to the school or other large infrastructure plans. In short, public works. Working with a primaria that is strapped for cash and reluctant to invest in a project without guaranteed results is very difficult. Thus, my efforts to bring gas heating to the school has comprised me suggesting an infrastructure project, my principal and
mayor telling me that they had found an non-governmental organization to help, me saying that they needed to find a specialist to price out the project and them telling me for the past two months that they're still trying to find someone.

Talking with an entrepreneur like Nicolae has me optimistic. Here is a man who has seen an opening for a business (indeed, three businesses) in his community that is not being filled elsewhere in the community. He has figured that he can make a profit in these businesses, and has found the capital with which to begin. Maybe Nicolae will be my Sergiu and, like Mark, I'll find myself working at his internet cafe this summer. Either way, his attitude is a sign of things to come in Mereseni and in Moldova.


At 2:43 PM, Anonymous Tim Primo said...

Have you found any internet cafe's in all of moldova where there is wireless access?

At 2:22 PM, Anonymous Li said...

Hello Peter,

I found your blog while I was searching for informationa about internet cafes in Moldova because I am a young moldovian that wants to come back in the country and open some internet cafes along rural areas in my bithplace.
Would You please send me the phone number of World Bank Office in Chisinau? I will be gratefull. Thank YOu in advance. Best wises, Lidia, South Korea

PS: My e-mail address is

At 6:29 AM, Anonymous Anonymous said...

What is this Sergiu's last name and does he have a buddy named Octavian? I know a better story about where he got those computers and who paid for them.

Moldova RPCV


Post a Comment

<< Home