It’s now been 100+ days that I’ve been in Uganda, serving as NGO Development Manager for ToughStuff International: a UK-based manufacturer of micro-solar products for the developing world. People look at that title and say, “that’s a funny sounding title—what does a solar power company have to do with NGOs?”
As it turns out, plenty.
There’s a shift underway in the way NGOs think about their roles in the world. For decades, NGOs and charities tried to solve poverty and other social problems by just giving poor people the things they need. The result: these giveaways have addicted people in the developing world to aid, damaging their capacity to improve their lives on their own. It’s a running joke among Ugandans that “people see muzungu and think they have money!” But it’s absolutely true: I’ve been asked to sponsor children’s school fees on several occasions.
But all that’s changing. Africans are a naturally entrepreneurial people—I see more beggars in the US than the UG, because most people are selling fruits or running other small businesses—and NGOs are finding ways to unleash this potential, pulling back on handouts and instead developing people’s capacity to fend for themselves. (At least the good ones are).
This often means partnerships with the private sector. Whereas in the past NGOs were skeptical of business, fearing their funds would only be subsidizing profits for corporations, today the more innovative NGOs are realizing that their funds can go farther when leveraged by efficient businesses with both profit and social motivations. Because NGOs do not need to make a profit, they can take bigger risks with their money to help life-improving products reach remote areas that would otherwise be unprofitable to reach, or reduce private businesses’ risk of supporting micro-entrepreneurs… or both.
For example, Living Goods is an NGO operating in Uganda that has developed a network of women entrepreneurs—“Community Health Promoters” (CHPs)—who sell health care products, solar lamps, and clean cook stoves to their impoverished and hard-to-reach communities. Instead of giving health products away, they’re helping the poor to think like consumers, while at the same time providing incomes to hundreds of women. Living Goods’ impressive network of trainers and branch managers are supported by income from sales, and subsidized by donor funds. I’ve worked closely with these guys for the past two months, and trust me, they are good.
Another example is Christian Aid. In early 2011, they partnered with ToughStuff Solar to launch a “business in a box” program in Kenya. The idea was simple: the people most in need of solar light are inconveniently the hardest—and most expensive—to reach; deep in the village, there is no good network of commercial shops who can profitably sell and service solar lamps. BUT, Christian Aid’s network of local partner organizations is already working in these areas. By piggybacking off Christian Aid’s existing network, it is possible for solar energy to reach areas that would otherwise be unprofitable for a business to serve.
And the way Christian Aid and ToughStuff went about it is particularly innovative. Christian Aid and ToughStuff share the goal not only of improving the environment, but also of improving people’s livelihoods. To achieve both goals, Christian Aid’s local partners recruit “Solar Village Entrepreneurs” (SVEs) from their existing networks and community groups. Christian Aid then buys solar lamps and extends them to these SVEs on partial credit so they can start small businesses selling or renting solar (SVEs typically pay 20%-50% upfront, a self-selection mechanism that filters out those candidates who are not serious about the business). ToughStuff trains the SVEs and provides marketing materials, and SVEs pay back Christian Aid as they sell their stock. The small margin Christian Aid earns is reinvested into the fund to expand the program.
You’ve heard of a win-win—this is a quadruple win:
- Communities get access to clean energy at affordable prices;
- Individuals boost their incomes via their own business rather than foreign aid;
- ToughStuff can profitably reach customers who otherwise would be impossible to access;
- Christian Aid does not need to rely on donors to continue the program: after the initial investment, the program is funded by sales.
Even with the growing pains inevitable with any pilot, the first wave of the program has achieved some impressive results:
- 57% reduction in kerosene consumption (in liters)
- 87% reduction in candles consumed
- 61% reduction in number of times people charged their phones in shops
- 49% reduction in radio batteries consumed
- 90% of entrepreneurs have increased their incomes
That’s a long windup, but it’s important context. So what do I actually do?
My job is to build distribution for solar using NGOs’ pre-established networks. This means building partnerships with NGOs who share ToughStuff’s social goals (clean energy, rural development, micro-enterprise and livelihood support), and who understand that giveaways are unsustainable. I’m also liaising with governmental organizations like GIZ to work on market development activities (for example, studies on solar and research on best practices).
On a day-to-day basis, this makes me a jack of all trades: part sales, part service, part product development, part people development.
In the morning I usually take a boda boda (motorcycle taxi) into the office to check emails and meet the sales reps. When I have no meetings, I’m writing training materials and proposals, and planning marketing activities. When there are meetings, I’m traveling around to both current and prospective partners. Some days this means racing around Kampala on boda boda to head offices: meeting with decision-makers and influencers to assess organizations’ ability to partner (you have to meet certain criteria to partner with ToughStuff), demonstrate products, and explain how partnerships work.
Other days I’m in the field, traveling to regional towns to meet NGOs’ field offices, train SVEs, and ensure any defective products are being replaced according to warranty. For example, with Living Goods, our partnership manager and I have done basic product training with all 5 of their branches, and we’ve moved around slums in Kampala with one of their Community Health Promoters to observe how they sell and provide coaching.
A different week I was in Kabale town and surrounding villages to launch a Business in a Box program. We did a full-day training with nearly a dozen entrepreneurs recruited by the NGO; this included both product and sales training. Each SVE also received product manuals, marketing posters, a ToughStuff t-shirt, and even business cards. (These training materials are expensive, so if you want to help sponsor SVEs, let me know!) After the training, it was off to a rural Savings and Credit Cooperative (SACCO) that was interested in selling solar to its members.
(I don’t have to do all this myself: I have three sales reps/partnership managers who report to me and handle much of the day-to-day support of these NGOs.)
I also spend part of my time monitoring product performance and getting feedback from the field. For example, at ToughStuff Uganda, we are individually inspecting and testing every lamp we have before selling them. I also meet with end users and NGOs’ regional managers to hear feedback about what they like and don’t like, helping to link our international product development team directly with end users in rural Uganda.
As a startup company that needs to turn profit to survive, we’re definitely not on the type of budget you’d see at a big NGO or corporation. When I’m on the road, I travel by bus or matatu taxi, and stay in $10 a night hotels; around Kampala I travel by boda boda, and so always carry a motorcycle helmet with me. (That said, I’m not exactly roughing it: outside of Kampala, $10 a night gets you a clean room with decent bed, sit-down toilet, and shower—albeit a cold shower. Plus our partners are fun to work with!)
I’m also supporting ToughStuff’s business in Ethiopia. I’ve been there twice to train our distributor, Equatorial Business Group, their and meet NGOs like Christian Aid, World Vision, and Clinton Foundation who may want to start Business in a Box programs there, as well as attend a conference on microfinance.
The last thing I’ll say is this: I’m constantly amazed by the range of NGOs that can partner with ToughStuff. We’re working with Christian Aid in Kenya, one of the largest NGOs in the world.
At the same time we’re working with Edirisa UK in Uganda: a UK-based (obviously) NGO that operates schools and health centers and promotes African culture in the Kabale district of Uganda. It seems an unlikely partnership at first—what do schools, health centers, and local crafts have to do with solar power? But on closer inspection, Edirisa has everything you need in a partnership: links to rural communities, buildings near to customers, a director who understands the importance of enterprise, and a dedicated operations manager.
So from the big boys to the local-and-dedicated, you’d be surprised at who can help the cause of getting clean energy to rural Africa. If your organization (or that of someone you know) is operating in rural Africa and you’d like to support clean energy and entrepreneurship, email me at Andrew.Kent@toughstuffonline.com
Enterprise solutions to poverty: that’s my job.