NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, May 28, 2014

After graduating from the prestigious London School of Economics, Kenyan Suraj Gudka, 21, didn’t go for a white-collar job in accounting.

Instead he opted to work with slum communities, co-founding SokoText, a social enterprise that harnesses the power of short messaging services (text messages) to create demand for produce sold by micro entrepreneurs in urban Nairobi slums.

Some slum-dwelling vegetable vendors, known popularly in Kenya as mama mboga – “mother of vegetables” — order tomatoes, carrots, potatoes and other vegetables through text messages.

SokoText’s business model is to buy in bulk, cutting out the middlemen, reducing transportation costs and making produce available from far-away markets to small entrepreneurs at a centralized location within the slum.

The end result is that the mama mbogas get to sleep later, avoid the insecurities of leaving their homes as early as 4 a.m. and don’t have to pay fares to get to Marikiti and Gikomba market miles away. They get produce delivered at their doorsteps and at lower cost, Gudka claims, than they would have incurred if they went solo.

The recently launched SokoText has raised $3,400 in funding through crowd sourcing.

Gudka, CEO of SokoText, spoke with AFKInsider.

AFKInsider: Of all businesses that you could invest in why did you choose SokoText?

Gudka: I chose to start SokoText because I am passionate about working with slum communities to improve the standards of living. SokoText is a social enterprise. We solve a problem for a specific group of people (mama mbogas) in a sustainable way.

AFKInsider: How did your passion for working with slum communities begin?

Gudka: While at the London School of Economics, I was directed to the Hult Prize competition for social entrepreneurs by a friend. With three other students from the society of social entrepreneurs, we filed our entry to reduce food insecurity in urban informal settlements.

We were selected among the top 500 entries but didn’t win. We then decided to enter our concept into an online league of the Hult Prize, emerging (in the) top six.

Having realized that we had a great concept I came to Kenya mid last year to collect data, shadowing and interacting with mama mbogas and loved touching the lives of slum communities.

AFKInsider: Walk us through the journey from product concept to launch.

Gudka: At first, we were looking at the larger problem of food insecurity in slums and so our first idea was towards getting households to place orders and we would match them with farmers and cut out the middleman.

However, as soon as we did some research on the ground, we found out that the main inefficiency occurs at the point where vegetable vendors get their inventory. We decided to focus on this and built our minimum viable product with our customers.

We operated a pilot for one month and went back to the drawing board to work on all the customer feedback. We raised enough funds to get us started with the next phase. We now operate SokoText in Mathare slum (Nairobi) having officially launched on May 4. We now have 25 regular customers and we offer 11 products.