Archive for Market-Based Solutions

This story originally appeared in our April 21, 2011 e-magazine. Click here to subscribe.

Pre-paid mobile phone services are reaching markets that other technologies have not yet been able to penetrate. How can this model be leveraged in other areas of development?

For those at the bottom of the pyramid, income is not a certain entity. No fixed amount is deposited into their bank accounts – should those even exist – at the end of the month. Their income is changing—from month to month, week to week, even day to day.

Which begs the question: if a borrower’s cash flow is so uncertain, why do so many companies attempting to serve that demographic insist on fixed repayment amounts?

At least one technology, invented in the 1990s, attempted to work around that problem: pre-paid mobile services that allowed people with variable incomes and/or poor credit to use cell phones. Such consumers made an upfront payment of only as much as they could afford in return for wireless services. » Continue reading “Top Up the World”

It’s been nearly seven years since the late C.K. Prahalad wrote The Fortune at the Bottom of the Pyramid, a book that has become essential reading for anyone interested in that segment of the economy.  In that time, the term bottom of the pyramid (BoP) has also become common vernacular.

However, despite the increase in awareness of the BoP space, a lot of the focus has been on the wrong questions, says Ted London, the Director of the Base of the Pyramid Research Initiative at the William Davidson Institute at the University of Michigan,

At an event in Mumbai last week for his new book, Next Generation Business Strategies for the Base of the Pyramid, London said there has been much discussion about whether businesses that target the BoP are good or bad for the poor. That, he argues, is no longer important. » Continue reading “Reframing the BoP Business Strategy”

Malnutrition is a serious concern in developing countries. In Kenya, Edom Nutritional Solutions has developed a premixed porridge and a maize flour product to combat malnutrition. Beyond Profit talked to Winstone Edward Odhiambo, the Co-Founder and Managing Director, about the unique product and its future.

What exactly is the Edom solution?

Our solution lays emphasis on preventive approaches to tackle the root cause of malnutrition by manufacturing a protein, mineral and vitamin rich precooked porridge product and maize meal flour and avail them to the malnourished through affordable retail distribution in rural areas, low market urban areas and smaller outlets in the villages in smaller packs of 250 grams that the majority millions in the bottom tier of the socio-economic pyramid can easily access and afford. » Continue reading “Premixed Porridge Tackles Malnutrition in Kenya”

This story originally appeared in our February 24, 2011 e-magazine. Click here to subscribe.

A sector of affordable private schools is emerging in the developing world. But how can investors take part?

The affordable private school movement—made up of private schools where monthly student fees are less than US$12 (INR600)—is gaining momentum worldwide and providing low-income families the ability to choose where to send their children to school.

“Our experience has been that the low-income families are very concerned about the education of their children,” said Debasish Mitter, the Portfolio Director of education in India for the Michael and Susan Dell Foundation. “These families are making the choice to send their kids to low-cost private schools.” » Continue reading “Private Education for the Poor”

This post is part of our ongoing partnership with GOOD Magazine. Post by Alex Goldmark of GOOD Magazine.

A directory of social enterprises around the world is getting bigger and easier to use, coming closer to being a central repository for market-based solutions to poverty. That’s something that could greatly help networking, academic study, best practices and fundraising.

The directory, iuMAP, collects and displays data on over 450 social enterprises, letting you search for them by name, or by country, legal structure of the organization, issue area—health, transportation, energy for example—or by funder. Like other data visualization and mapping sites it also gives a clearer picture of what kinds of organizations are where. See the screen grab above to see how Kenya and India just have a higher density of bottom of the pyramid organizations. » Continue reading “Ayllu redesigns IUmap global social enterprise directory”

This post is the second half of a piece we published last week, Basic Services for All: Whose Responsibility is it Anyway?

Last week, I wrote about the provision of basic services for all, and posed the question, whose responsibility is it? To paraphrase: When the government can’t provide, should we let someone else step in?  And, in so doing, do we send the message that it’s okay for government to fail?

The conclusion last week led us to look to social enterprise as the most viable alternative to government service provision, because the private sector tends to serve the wealthy, not the poor, and the non-profit sector may not be a sustainable solution. But, the question persists: by providing an alternative, are we giving government an out, so to speak?

One commenter, Anoj Viswanathan (check out his socent Milaap), believes that we don’t have the luxury of contemplating who should do the work. “While creating a systemic change is indeed required, the question one has to ask is – do I lobby/wait for a grant/subsidy that may/may not come my way, while another generation would have slipped into the grinding cycle of poverty?,” he said.

Viswanathan brings up a great point: having a theoretical debate doesn’t help the people who need education or healthcare now. But, taking a big picture approach can help us bring change to the masses, instead of just a single target group, and make sure that we’re not sending the government the message that it’s okay to fail. » Continue reading “Education for All? Invite Government to the Table”

When it comes to providing basic services like education, healthcare, and finance, who is responsible?  Unarguably, most would say government. But, when the government can’t do it, should we let someone else step in?  By letting another group—the private sector, NGOs, social enterprise—provide these services, do we do a disservice to the poor? Worse, do we send the message that it’s okay for government to fail?

These topics came up during a recent workshop hosted by the Rockefeller Foundation in Bangkok. Dr. Timothy G. Evans, dean of the James P Grant School of Public Health at BRAC University in Dhaka, eloquently argued that by letting private healthcare and education mushroom, we do a disservice to the poor. We cut the poor out of the equation by only providing for the wealthy. » Continue reading “Basic Services for All: Whose Responsibility is it Anyway?”

By Dipika Prasad

The nature, complexities and business model solutions of the BoP were the subject of a session delivered by S. Sivakumar, the Chief Executive of Agri Businesses at ITC, at iDiya 2010 last week. Beyond Profit live tweeted the discussion, which can be accessed here. We caught up with Sivakumar to learn more about his journey of innovations in rural marketing, and empowering the Indian farmer. » Continue reading “Rural Marketing: Trust is Critical”

By Molly McMahon, Gray Matters Capital

Why do we call our initiative with affordable private schools Enterprising Schools? The definition of enterprising is “Imagination, initiative, and readiness to undertake new projects[1],” and that best describes the participants who gathered for the 2^nd Annual Enterprising Schools Symposium last month in Hyderabad India.

The 100 stakeholders in the Affordable Private School (APS) sector who traveled across the globe from 66 different organizations in October are truly enterprising.  They came, by plane, train, car, auto rickshaw, and even braved the Indo-Pak border to discuss, learn about, and solve the opportunities and challenges facing the APS market.  Entrepreneurs, investors, NGOs, donors, school owners, researchers, financial institutions, teachers, and students gathered in Hyderabad with the common goals of increasing school quality and general market viability. » Continue reading “Bold New Ventures in the Low-Income Education Market”

Beyond Profit is reporting from the Clinton Global Initiative in New York City this week.

Thirty years ago, if you asked development experts how to move people out of poverty, they would tell you, “Invest in agriculture.” Today, if you asked development experts how to move people out of poverty, they would tell you, “Invest in agriculture.” The problem, according to Rajiv Shah, USAID Administrator, who spoke at the 2010 Clinton Global Initiative on Tuesday, is we haven’t done it to the extent that we should have. And, he says, USAID is as guilty as anyone. As a result, many African countries are falling behind, food inflation has been hitting developing countries in extreme ways, and more people are sliding back into poverty.

Why is agriculture development so important? By investing in agriculture, you can improve a country’s agricultural productivity, and in so doing, move many people up and out into new jobs. Not to mention, agricultural efficiency means lower food prices—and when you only have a dollar or two each day to make ends meet, and food makes up the majority of your expenses, lowering the cost of food allows for dramatic gains in family income. In fact, agricultural development is 3-4 times more effective in boosting an economy than GDP.

» Continue reading “Seeding Progress in Developing Countries”