The village that could save the planet

How two men plan to extend the ecological miracle that is Gaviotas, Colombia, across the rest of the Third World.

By Paul Kaihla, Business 2.0 Magazine senior writer

(Business 2.0 Magazine) -- We're rumbling across eastern Colombia in a convoy of military jeeps and pickup trucks. Salsa music blasts out of speakers somewhere, and an unrelenting 100-degree sun is bleaching the bone-dry savanna. Although there's not a plane in the sky or a living thing on the ground for miles around, our convoy is armed to the teeth.

Commandos in fatigues and flak jackets ride shotgun - with M-4 machine guns dangling from their shoulders and automatic pistols strapped above their right knees. One soldier is perched in a turret with a 7.72-mm machine gun. Another mans an MK-19 grenade launcher.

Odd couple: Pauli and Lugari promote Gaviotas's inventions through an R&D center in Bogota.
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Water Wheel: this tiny hydroelectric turbine is one of four technologies that keeps Gaviotas off the national grid. It generates 30 kilowatts off a 1-meter drop in a low-fall dam.
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Pitch Products: Gaviotas harvests pine pitch from its forest rather than clear-cutting for timber. The pitch is the primary raw material for a factory that produces five industrial compounds like colofonia, an ingredient in paint and turpentine.
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Father of Invention
Paolo Lugari's 7 secrets for creating creativity.
1. Ban brainstorming meetings: Creativity is spontaneous. Formal meetings are a poor forum for creation. People choke because they show up for a limited time with a narrow agenda. Turn every workday into a continuous, open-ended brainstorming session.
2. Practice da Vinci's code: When your organization tackles a problem or a project, wipe the board clean of all assumptions and prior knowledge. "Leonardo da Vinci expressed it best," Lugari says. "Step one is a tabula rasa."
3. Play nice with others: At Gaviotas, new technologies grow out of a process of tweaks and upgrades, with a variety of contributors adding their own nuts and bolts. "These inventions came out of spontaneous, collective thinking," Lugari says. "We don't like prima donnas."
4. Burn the corporate policy manual: To think freely, you have to act freely. A fanatical dedication to free speech - unencumbered by top-down prohibitions - has produced a Gaviotas mind-set in which unproductive behavior melts away of its own accord.
5. Rule out "degree-itis": There is no hierarchy based on titles; a peasant worker gets the same hearing as a Ph.D. One of the most important revenue streams at Gaviotas - the production of industrial coatings and resins from pine pitch - evolved from an observation made by one of the cooks.
6. Master the art of indiscipline: Big breakthroughs are often the result of people crossing disciplines. Mendel was a priest before he was a biologist; the fuel cell was invented by a lawyer. So rotate your specialists out of their specialties and promote generalists ahead of narrowly focused experts.
7. Trash your Outlook calendar: Give up time-management tricks and devote each hour of every workday to whatever task or inspiration arises spontaneously. If you keep filling your week with scheduled meetings and tasks, you'll snuff out your creative sparks before they have a chance to fly.

This rolling armada of arms and men has been seconded for a business mission from a military base near Colombia's eastern border that forms a front against the Revolutionary Armed Forces of Colombia (FARC) - the main opposition in a narco-insurgency that has made this drug-ridden country one of the most feared destinations on the planet. The base doubles as a sentry for a nearby U.S. Drug Enforcement Administration radar station that tracks smugglers flying loads of cocaine to transshipment points in Venezuela, just a few miles away.

But it's the human capital our convoy carries, not cocaine, that has brought out the big guns today: two men whom an Army general sitting near me describes as holding the future of Colombia - if not the world - in their hands. And our destination is not a Venezuelan drug drop, but the site of an economic miracle in the making called Gaviotas II.

The first Gaviotas, located 250 miles to the west, is the creation of the more senior of the two dignitaries at the center of our convoy. Paolo Lugari, 63, is a self-taught inventor who has become a folk hero in South America for founding a model community of sustainable development in the parched Colombian lowlands.

Innovation ecosystem

His fellow traveler, Gunter Pauli, 51, has the aura of a matinee idol and the charismatic charm of a European Barack Obama. He's a globe-trotting entrepreneur and wheeler-dealer who speaks seven languages, makes his home in Tokyo, and carries a Belgian passport.

The men make an odd couple, bound together by an audacious ambition to extend the Gaviotas model of green development and self-sufficiency across first Colombia and then the rest of the Third World.

Their shared vision begins with Gaviotas, the ecovillage Lugari launched in 1971. It's one of the most improbable field experiments in the annals of science and engineering: a freewheeling center of innovation devoted to building a sustainable society in one of the globe's least hospitable climates.

Built from scratch in a treeless corner of the country, this community of scientists, tinkerers, and refugees - now numbering more than 200 - has created a verdant rainforest where once there was nothing but scrub grass. It has also devised and deployed dozens of inventions with a frequency and success rate that puts some of America's most storied technology companies to shame.

Its products include a hydroelectric microturbine that generates 30 kilowatts and thousands of RPMs from a mere 1-meter drop in a low-fall dam; a system of solar panels, spherical boilers, and tanks that can provide hot water for housing projects as large as 30,000 units; and a remote-controlled zeppelin that uses videocameras to spot forest fires.

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Unlike the startups that dot Silicon Valley, Gaviotas has done all this and more with virtually no funding, no well-endowed university backing, no incubators or venture capitalists, and no access to a national power grid, airport, or freeway system. In fact, Gaviotas lies 15 hours east of Bogotá, the nearest city of note, by a two-lane road that traverses the estates of narcotics traffickers and disappears occasionally into sloughs of mud.

Gaviotas has been occupied from time to time by guerrilla bands. Lugari himself is a perennial kidnapping target who was captured once and let go only after the president of Colombia intervened and pleaded for his release.

The magic of Gaviotas is in the corporate counterculture that Lugari has fostered. It eschews formal meetings and time-management conventions, promotes jacks-of-all-trades over specialists, and conjures the kind of devotion to discovery that produced great mathematicians in the villages of ancient Greece. (See "Father of Invention," below) "The surrounding region has had no law, high crime, and roving bands of paramilitary units," Lugari says. "Gaviotas is an experiment built on crisis management. You can't learn how to do this in a university."

Pauli is Lugari's younger alter ego. He first discovered Gaviotas in 1984 as an idealistic 27-year-old graduate of Insead, France's prestigious business school. "Gaviotas seemed almost biblical," Pauli recalls. "I took it on as my life's work." After a long internship as Lugari's intellectual disciple, Pauli has come into his own.

A serial eco-entrepreneur who has made millions by running, and selling, companies like Holland-based biodegradable-detergent maker eCover, Pauli represents a new generation of leadership for Gaviotas. Under an agreement with the Ministry of Defense, he has spent the past three years drawing up plans and enlisting support to build out the Gaviotas model across the entire northeastern quadrant of Colombia - a vast area roughly the size of England.

On today's trip in the military convoy, Pauli and Lugari are laying out their master plan for a group of government officials and business leaders, detailing how they can take this savanna - a region that experts had written off as agriculturally and economically barren - and through aggressive planting and careful development turn it into a clean-tech economy with a population of 5 million.

If the enterprise succeeds (and Pauli has already lined up funding pledges worth hundreds of millions of dollars from investors such as JPMorgan (Charts, Fortune 500)), this area could become one of the largest biodiverse reforestation projects on earth. At the same time, it would put a measurable dent in global climate change: Gaviotas II's carbon sequestration would offset the equivalent of the CO2 emissions from all of Japan.

Pauli's deeper purpose is to create a living laboratory to show other developing countries how to do the same - how to end their dependence on oil imports and grow their economies by becoming exporters of biodiesel. "This is a high-risk, high-reward project," Pauli says. "You need an example of how you can make it work before big investors come in with a lot of money. That example is Gaviotas."

This stretch of eastern Colombia is known as the province of Vichada, and from the lofty vantage of a mini Hercules cargo plane on the first leg of our journey, it looks like Montana with sections of the Mississippi River running through it. There are no trees, roads, houses, or people - just reddish turf with sparse grasses and shrubs, etched by a meandering river punctuated by oxbow bends.

Pauli and Lugari, who are harnessed into the plane's netting alongside the other VIPs like a row of would-be paratroopers, point through the portholes with proprietary pride as Gaviotas comes into view. Suddenly an amoeba-shaped oasis of verdant forest fills the vista below, an oasis that covers 20,000 acres.

The cargo plane lands on a dirt strip on the edge of Gaviotas's forest, and commandos quickly set up an armed perimeter for their high-ranking entourage. A tractor tows bewildered visitors in a motorless carriage fashioned out of a Bogotá city bus while Lugari explains that the forest around them was planted by hand with a single species, Honduran pine. Over three decades the evergreens spawned - without human intervention - an ecosystem that now boasts more than 200 plant and animal species.

This reconstituted forest also feeds raw materials like pine resin to a handful of businesses in the village, a value-added economy in the outback that was initially built by selling inventions like the solar-powered hot water system. (The U.S. embassy in Colombia is a customer.) Gaviotas, which is administered by a nonprofit foundation, sinks all its surplus into its primary asset: those Honduran pines. The entourage halts to watch a team of five men in peasant garb, with the help of a biodiesel-fueled Ford tractor, trench and plant two rows of 50 pine shoots in two minutes flat.

The group passes one of Gaviotas's earliest inventions, a tall wind turbine. It powers a pump that funnels deep aquifer water to a commercial bottling plant, an open-air building with mosaic tiles that sits near the village's cinder-block school and residential complexes. There a group of women in their 20s and 30s wearing white work coats shyly greet Lugari, Pauli, and their guests. They tell Lugari about minor tweaks they've made to the plant since his last visit a few weeks ago.

Pauli has brokered a deal with the Juan Valdez chain - Colombia's version of Starbucks - to exclusively distribute Gaviotas water, which is packaged with a playful utopian logo. Like other bottled waters, it's a high-margin business. The production cost is about 5 cents per unit; the retail price is about $1. After transportation costs and the retailer's markup, Gaviotas enjoys a gross 30 percent profit.

Margins this generous have allowed Gaviotas to fund a free municipal water system for the village, invest in new inventions like the remote-controlled zeppelin, and position the place as eastern Colombia's equivalent of the Googleplex.

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.