The Weekly Roundup (2/2/13) : Formal, informal and ‘Unreasonable’
One of the first articles I edited after joining NextBillion a little more than two years ago was a Q&A with Peter Frykman, the founder and CEO of Driptech, an irrigation system catering to base of the pyramid customers. Before he founded Driptech, Frykman was working toward a PhD in mechanical engineering at Stanford University. He was sidetracked after taking a course called Entrepreneurial Design for Extreme Affordability, which led him to Ethiopia and to create an affordable irrigation system for small plot farmers.
This interview helped crystallize my impressions of what every BoP hardware company should possess: a radically affordable, radically simple technology (after all, drip irrigation has been around for half a century). But it takes much more than that to develop a loyal customer base. So, it was great to hear from Frykman again this week in this succinct column Accelerating Customer Adoption at the Bottom of the Pyramid in the Harvard Business Review. Frykman notes that many of the same tools of building a clientele in the developed world apply to BoP enterprises. It starts with early adopters, building a viral campaign from those evangelizing customers, and then introducing new products to an expanding customer base. But there are additional tactics when working with low-income consumers, he writes:
“Chances are, if you successfully identify a BoP customer-need and deliver an appropriate solution, two things will happen. First, you will gain the trust and loyalty of that customer. Second, you will identify additional needs of that customer through further observation and listening. Our customers often suggest new products and services that they would like us to provide, creating value for both them and us.
Sometimes the most valuable thing you can provide is knowledge. For example, we highlight best practices for fertilizer application, which also enhances the benefits of drip irrigation for our customers. In this case, one solution can be used as an avenue to introduce another, complementary solution.”
Informal City Dialogues
From the rural to the urban, I’ve been enjoying in this ambitious project called the Informal City Dialogues, an expansive effort to chronicle the formal and informal economies of Accra, Bangkok, Chennai, Lima, Manila and Nairobi, and the people who navigate them. Black markets and labyrinthian networks are the facto foundation of these cities, shaped by both poverty and wealth, social and political struggle, environmental degradation and the inherent human drive for a better life. The project seeks to tell the stories of the urban dwellers, merchants, hustlers, financiers and other players navigating both informal economy of the megacity, but also connecting to the formal/global business, and ultimately toward a more inclusive economy. With a writer embedded in each city, the dialogues explore anything from a credit/savings association helping to build more sturdy homes in a slum in Accra, to Filipino designers who are working with local craftswomen to sell handbags around the world.
Finally, here at NextBillion we have a soft spot for the Unreasonable Institute. Maybe it’s because the intense accelerator/mentoring program graduates so many entrepreneurs who go on to great things, maybe it’s because so many of the entrepreneurs are already doing some great things when they join, or maybe its because we just like the cut of the jib that propels the folks who sail the big ship of the Unreasonable Institute.
It’s probably a combination all all three. And last week, Unreasonable opened their Marketplace, the Kickstarter-like platfrom that gives these unconventional leaders a chance to raise their own tuition to the Unreasonable institute this spring by pitching their business plans and visions.
Here is the list and brief descriptions for the 2013 “Unreasonables,” and here’s how to connect with them via the Marketplace.
- 17 Triggers (Mike Rios and Lilly Diaz) Cambodia: 17 Triggers does marketing for good causes. They help social enterprises and non-profits market their products and services so their beneficiaries can improve their lives. For example, WaterSHED (an organization that sells toilets in rural areas), previously had sales agents generate 2,000 latrine sales in 5 months. After working with 17 Triggers, WaterSHED generated 17,000 latrine sales in 12 months.
- Chaupal (Aloka Singh) India: Chaupal is building a network of hospitals to serve lower-income populations in India. They combine these hospitals with a mobile health clinic and temporary health camps that set up in villages to extend the reach of healthcare deeper into rural India. They have so far provided healthcare access to 650,000 people in India.
- MANA Nutrition (Mark Moore and Troy Hickerson) Global: MANA Nutrition manufactures and sells Ready-to-Use-Therapeutic-Food (RUTF) Peanut Butter to UNICEF for distribution around the world. So far, they have generated $6 million in revenue and their peanut butter has been delivered to over 100,000 youths.
- Nisolo Shoes (Patrick Woodyard and Zoe Cleary) Peru: Nisolo connects Peruvian shoe-makers with the US market for their high-quality leather shoes. In their first year of operation, they generated $220,000 in revenue from over 4,000 customers and increased the incomes of 30 Peruvian shoe-makers by 6x.
- Greenway Grameen Infra (Neha Juneja and Umang Maheshwari) India: Greenway Grameen designs and distributes biomass-fueled clean cooking stoves to rural India. They have generated $300,000 in revenue, selling their stoves to 10,000 rural households. They have reduced fuel consumption by 60% and emissions by 80%. Their cooking stove was recently named one of the top 14 design stories for 2012 by Fast CoExist!
- OurSay (Eyal Halamish) Australia: OurSay empowers citizens to hold their leaders accountable and ask the important questions by connecting them virtually, forcing politicians to keep promises beyond sound bites and putting communities back in charge of their own destinies. They have over 50,000 members, have generated over $400,000 in revenue, and are pioneering innovative ways to engage with politicians like Google Hangouts with the Australian Prime Minister. OurSay is planning a pilot in India for 2013.
- Agrilab Technologies (Brian Jerose) United States: Agrilab Technologies makes composting and integrated thermal energy/heat recovery systems for farms, businesses, and communities. They produce a system that captures heat released by agricultural waste and turns it into energy, giving farmers another significant revenue stream. In the past two years, they have generated nearly $70,000 in revenue, working with farms and dairies throughout the northeast, including the University of New Hampshire’s research dairy farms.
- Prospera (Gabriela Enrigue) Mexico: Prospera trains women entrepreneurs in Mexico (predominantly in the food industry) with the designing and branding of their products. Then Prospera connect these micro-enterprises with markets to sell their goods so these women can move out of poverty. So far, they’ve increased sales by 300% for 3,000 micro-enterprises and provided training and mentoring through their 200 volunteer mentors.
- UpEnergy (Nicole Ballin and Edward Lubega) Uganda: UpEnergy distributes $12-15 clean cookstoves throughout Africa, increasing the availability of clean energy home appliances to underserved populations. They have sold over 13,000 cookstoves to 11,000 customers, offset 30,000 tons of CO2 emissions, and generated $170,000 in direct sales and over $400,000 in carbon revenues via selling carbon credits.
- Sudiksha (Naveen Peddalagalla and Nimisha Mittal) India: Sudiksha runs 18 affordable, for-profit, pre-schools for the poorest children in the slums of Hyderabad and the rural areas Andhra Pradesh. They have provided a high-quality pre-school education to 1,500 low-income children, charging each student $8 per month, and generating $75,000 in cumulative revenue.
- Voltzon International (Pepijn Steemers and Sjoerd Spaanjaars) Tanzania: Voltzon is undercutting the price of diesel generators in east Africa by providing a solar energy solution to off-the-grid communities. They lease out a mobile solar energy container to hospitals and schools, installing 16 systems so far in schools and healthcare institutions throughout Tanzania. They have generated $662,000 in revenue in the last four years and are exploring new financing models to make solar more affordable.
- Trash to Cash (Madhumita Puri) India: Trash to Cash trains adults with a variety of disabilities in India to collect trash and turn it into beautiful products that can be sold in India and elsewhere. Since 2008, they have generated $220,000 and employed 87 women with disabilities who would otherwise be without employment.
- MPrep (Toni Mariviglia and Chris Asego) Kenya: MPrep uses mobile phones to prepare underserved Kenyan students for their primary-school exit exams. So far, they have over 4,500 students at 90 schools using their SMS-based study tools, which have led to students who previously underperformed on test-scores to exceed class averages after using MPrep.
- The Good Life Organization (Roberto Rivera) United States: The Good Life Organization has created curricula that equip educators and mentors across the United States to engage effectively with youths for the purpose of transforming communities. Their impact spans from leadership training to increases in student GPA to higher graduation rates at high schools. After GLO’s involvement in one mid-western high school, the school reported its first ever 100% graduation rate.
In Case You Missed It … This Week on NextBillion
Special Series (Part 3): BPO for the BoP : The trials and successes of an early-stage Impact Sourcing Service Provider in Africa By Ekta Jhaveri — WDI
Microfinance CEOs: Smart Campaign Certification is a Clear Step Toward Responsible Microfinance By Mary Ellen Iskenderian and Rupert Scofield
Community + Entrepreneurship: How community can strengthen the impact movement – Watch the replay of the Google Hangout By Jesse Grainger
Doing Good Business for Better Health: The view from drugmaker GlaxoSmithKline on expanding access By Allan Pamba