Via Aman Bhandari's Technology, Health, and Development Blog, a fascinating take on the 10th anniversary of the GrameenPhone program from Fast Company magazine:

But as it turns out, the [GrameenPhone] legend is far out of date. The proliferation and democratization of technology has bested the economics of microenterprise. In Bangladesh today, the only one making real money on GrameenPhone's wireless service is … GrameenPhone.

I'll be the first to admit being a major GrameenPhone booster, both here at NextBillion and back during the Digital Dividends years.  That said, this article isn't surprising.  As mobile phones have become cheaper, they have become ubiquitous - even in places like Bangladesh.  What follows is basic microeconomics: as supply increases and demand remains stable, prices will go down. 

For GrameenPhone entrepreneurs (commonly known as "Phone Ladies") a price drop can be catastrophic.  Remember, these phones are purchased on credit, and if their customer bases shrink, it can be difficult to pay back the loan.  You won't hear default stories coming out of the Grameen Foundation, but they are real, as Courtland documented a few months back.

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Update Deadline Extended: September 28, 2007

Catalytic Communities has launched a competition in which participants will help identify creative, community-based solutions to challenges in Education & Skill-building, and Business & Economy. The deadline to post your project is September 14, 2007.

The projects sent to the Community Solutions Database will join the "growing global network of grassroots projects, many of them small-scale, but which together have the potential to transform the world. Through the CatComm Network, all projects get translated to three languages initially. They are then communicated to our 6000+ member network, including community leaders, journalists, volunteers, and potential funders."

By posting your local solutions to the Community Solutions Database you will be:

• Showcasing your community and city's grassroots efforts to the world.
• Inspiring people elsewhere to make a difference and learn through your community's example.
• Broadening the visibility of your local efforts around the world.
• Attracting support from people in your town and around the world who learn about your efforts and want to help them grow.

If your project is contributing to solving at least one community challenge in the areas of education, skill-building, business, or employment; it was initiated by a member of the community it serves; and if your project serves as a positive example to community change – then your project qualifies! Do not hesitate to post it!

In the wake of last week's discussion of Professor Anand Jaiswal's new paper, I received a note from Professor Nancy E. Landrum from the University of Arkansas-Little Rock.  Her new paper, Advancing the 'Base of the Pyramid' Debate (PDF), was first published this past May in the inaugural issue of Strategic Management Review.

In her paper, Dr. Landrum has done a more or less comprehensive overview of the Base of the Pyramid debate.  Her literature review has me looking up additional papers - and for that, I thank her.  She criticizes some aspects of C.K. Prahalad's arguments based on his 2005 book, Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits. 

Like Professor Jaiswal's paper, Dr. Landrum's falls short in that she fails to examine some of the more recent work in BOP.  This may be the result of unfortunate timing - her section on mis-measurement of the BOP would benefit from a close reading of the WRI/IFC report, The Next 4 Billion: Market Size and Business Strategy at the Base of the Pyramid, which came out shortly before her paper was published.  It's also worth pointing out that Prahalad's research has advanced since his book came out, and that his speeches, articles, and even PowerPoint presentations are available online.

That said, I think this new paper is worth a close read for anyone interested in the BOP space.  The literature review alone is worth it, but Dr. Landrum's objective analysis of the BOP debate is the real gem here.  Check it out...and if there are other papers out there dealing with the BOP space, let me know!

In a recent interview with New Ventures staff, the China Environment Fund’s Steven Guo explains what two recent exits mean for green business growth.

PDF Version of this article

"Solar IPOs shine," raved a CNN headline earlier this year, a declaration that comes as little surprise to Steven Guo, director of research and analysis at the China Environment Fund. After all, two of the CEF's first three exits have been from companies in this high-growth industry, a sector with $4.7 billion in funds raised for initial public offerings this year alone. Since their IPOs, the performance of LDK Solar and Sunergy has been mixed; LDK's stock has leapt from 27 dollars per share to 43 as of August whereas Sunergy's price was 27 percent lower three months after it began trading publicly. Much of the reason for this difference can be attributed to circumstance - LDK is an upstream company which has been favorably affected by increasing silicone prices - but in any case, the returns associated with each exit have been crucial to the continued growth of the Fund.

 

Steven focuses on the dynamism and background of the entrepreneurs behind LDK and Sunergy as keys to their success.

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Great inventions have changed our lives and the world dramatically throughout history. For instance, my Mayan ancestors from the Yucatan invented the cero (a.k.a. the zero). Of course there are more mainstream inventions: the light bulb, the telephone, the Internet (thanks, Al Gore) - the list goes on forever.

The need for new invention remains. The world today needs inventors to create sustainable social change while protecting and restoring the environment. There's an amazing opportunity to innovate and create something new: a product or a process that will improve the quality of life for the generations to come in a sustainable way.

The $100,000 Lemelson-MIT Award for Sustainability “serves to increase awareness of local or global sustainability issues and inventors working in these critical areas, and also supports continued inventive work of these individuals.”

Rob blogged last year about Dr. Amy Smith on NextBillion; she won this competition in 2000 with a series of designs focusing mainly on BOP needs.

To participate in this competition you must be a U.S. citizen, permanent resident, or foreign national currently working legally in the United States. The inventors must have "created a product, process or material; made a technology more affordable; redesigned a system; or otherwise demonstrated remarkable technological inventiveness in addressing local or global sustainability in the United States and/or abroad."

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Many people are driven to go and work in other countries for some period, especially now that it is easier than before. Traveling and working is an excellent way of learning about the world, gaining first-hand knowledge, and exporting some of our own knowledge. At a personal level, working abroad helps you learn about yourself and your own culture while at the same time giving something back to humanity by offering some of the things you know and have experienced. There are many programs worldwide through which professionals can go to other countries and work to apply their skills. The first one that comes to my mind is the Peace Corps, but there are many other programs, including a new one that just started.

Have you heard of Doctors Without Borders? Well, the main idea is that doctors go around the world and help communities in need for a couple of years. The new "Executives Sans Frontières" (Executives Without Borders) is patterned after the same premise, but with a market approach. I find this idea really interesting, because individuals with business expertise can help manage market development in disadvantaged areas in the world by building sustainable commercial ventures. Strategy + Business’s Jonathan Ledgard wrote an interesting article on this new endeavor and how they could help one of the poorest regions in the world: the Sahel.

Although some businesses have tinkered with sending salaried consultants to developing countries on pro bono projects, such projects tend to be temporary and focused at the higher levels of government. The ESF, however, would be far more adventurous, appealing to executives’ altruistic instincts while giving them an opportunity to apply real business learning in exciting, uncharted settings. ESF would target mid-career managers with experience, drive, and a sense of joie de vivre. There could also be an opportunity for companies to get involved directly; for example, FedEx might donate 15 employees a year, who would each serve four years with ESF while remaining on FedEx’s payroll.

The Wall Street Journal blog says "EWB couldn’t fix every problem in the developing world, Mr. Ledgard writes in consulting company Booz Allen Hamilton’s magazine Strategy + Business. But it might help address some issues more efficiently than aid money, he says. For example, the Sahel, which spans nine African countries along the southern part of the Sahara, is in urgent need of business savvy. It suffers from civil war and drought, yet has abundant and untapped natural resources such as livestock, cotton, corn and sorghum."

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Al Hammond, Virginia Barreiro and I are heading to Michigan this weekend for the big "Business to Four Billion" conference in Ann Arbor.  Al will be keynoting on Sunday night at dinner, and I'm moderating a panel on Monday morning -- so, shameless self-promotion - check us out!

You should also swing by the World Resources Institute table during the Interactive Networking Session on Monday afternoon.

For those unable to make it out to Michigan, good news: there will be webcasts of the conference plenaries and of some sessions.  In addition, Nicole Goldin of Changing the Pyramid will be live blogging the entire event.  Of course, I'll do my best to post after each day, but Nicole will be a definitive source.  Check out her site for updates.

See you in Michigan...and watch out for Appalachian State fans!

"The sun has set in one of the world's poorest nations and as the floodlights come on at G'bessi International Airport, the parking lot begins filling with children." I read this in the news article "Kids in Guinea Study Under Airport Lamps" earlier this summer. I thought to myself that the lack of light in Guinea makes these students go to the airport to be able to study for their finals, and that sometimes they have to walk for about an hour to get to the airport. One word describes my thought process: wow.

In modern life, light plays a bigger role than we think. If we didn’t have light we would have to do everything we needed before the sun went down, thus cutting down productivity. This community in Guinea is one of many communities in sub-Saharan Africa that does not have access to electricity, and therefore they do not have light. People usually rely on inefficient and unsafe kerosene lamps to get by, or candles, or fires.

The World Bank launched an initiative this week to address this problem. The IFC (the Bank’s private sector arm) will run a program called "Lighting Africa." Its goal is to develop market conditions for the distribution and supply of safer, greener lighting products.

"These products can include fluorescent light bulbs and light-emitting diodes for use in rural and urban areas not connected to an electricity grid. Power would come from the sun, the wind and mechanical devices such as pedals,” says an article in the International Herald Tribune.

This new program of lighting Africa has many advantages. The environmental advantage comes from not burning fossil fuels. Then there’s the social advantage: businesses will be able to operate for longer hours, people will be able to have light in their homes, and students will be able to study in their homes for longer hours. As Claire Soares from The Independent says,

Lighting Africa officially launches on 4 September, when organisers will unveil a competition for the design and delivery of low-cost, green lighting products for low-income consumers in sub-Saharan Africa. More than 350 companies have already expressed an interest - from Africa-based small businesses to multinationals like Philips.
Perhaps key to the appeal, is the World Bank calculation that the so-called "energy poor" in Africa spend about $17bn each year on fuel-based lighting. "It's a sleeping giant from a market perspective," says the IFC's Mr Sturm. "The poor, even the poorest of the poor, can be a profitable market."

Well, it sounds like it’s time for the 'dark continent' to begin to shine!

I'm in Ann Arbor, Michigan for the "Business With Four Billion" conference - the first major "base of the pyramid" meeting since WRI convened the "Eradicating Poverty Through Profit" conference in December, 2004.  On a macro level, my impressions from day one are three-fold:

1. The energy here is amazing.  I saw a slide put up by Ted London (Director of the William Davidson Institute's BoP Initiative and one of the conference organizers) with the attendance - it's about 1/3 academic, 1/3 NGO or government, and 1/3 business.  This kind of split would have been unthinkable 3-4 years ago.  The sheer momentum that the BoP concept has gathered in the private sector is palpable.

2. The level of thinking is advanced.  That is, it has advanced, especially over the last couple of years.  No longer is it necessary for plenary speakers to walk the audience through the BoP concept.  We get it, and they get right down to it.  I'll have more details on today's plenaries (C.K. Prahalad, Stuart Hart, Ted London, and Al Hammond) below.

3. We still have a long way to go.  If attendees left with anything today from Prahalad and Hart's presentations, it is that the challenge of inclusive, pro-poor, pro-environment growth is a huge one.  We need the private sector to step up - but we also need governments, NGOs, and even private citizens (Kiva, anyone?) to answer the bell.  The BoP proposition is about advancing this generation's greatest challenge: how to bring 4 billion people into the middle class without overwhelming Earth's natural systems.  Not an easy question.

OK - a quick plenary recap (I will have a full recap after I return to DC and can digest everything).

C.K. Prahalad was the first to speak.  His talk centered on the establishment of a new development paradigm, one that will turn the way we've traditionally viewed development on its head.  In typical C.K. style, the guru went through perhaps 40 slides, each one offering a new strategy or perspective that left the audience nodding its collective head in agreement.

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For anyone interested in working with BOP issues, I came across this job posting this morning:

 

Unitus, a social enterprise based in Seattle, WA and Bangalore, India, is a worldwide leader at scaling proven solutions to global poverty. Unitus accelerates access to life-changing financial services for those living at the bottom of the economic pyramid – the three billion people who are living on less than $2 a day.

We seek a dynamic, passionate team player to develop and execute on a number of innovations that are critical to Unitus's long term goals and sustainability in an increasingly dynamic market around the world.

The successful candidate will be an out-of-the-box thinker, but also one that can manage multiple work streams in an organized fashion. He/ she must be comfortable with ambiguity and enjoy the process of cutting through complexity to find practical, highly leveraged and scalable solutions in the microfinance industry and to poverty related issues. He / she will catalyze the process of developing new business initiatives from the research phase through the analytical phase and be comfortable 'letting go' after the initial steps of implementation.

Via Social Edge

I'm back in DC after three very full days at the Business With Four Billion BoP conference in Michigan. First of all, let me assure you that I'll have session summaries written and posted as soon as possible - in the mean time, be sure to check out Nicole Goldin's live-blogging over at Changing the Pyramid. You can also check out some PowerPoints and perhaps even archived video/audio of plenary speakers at the BoP2007 web site.

In the mean time, I want to tell a short story that I hope will illustrate why this conference was important for those of us who live and breathe BoP.

One of the reasons I enjoy traveling for work is down time in airports. Combine a little down time with the complimentary newspaper that most business hotels provide, and you've got a great way to spend a few hours. Yesterday was no exception: I picked up a copy of The New York Times at my hotel in the morning, and by 3:00, I was at my gate, leafing through the front section.

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The Madras Management Association will be organizing the sixth All-India Management Students' Convention in Chennai, India on September 21 and 22. The convention will focus on Strategies for the BOP.

There will be three business sessions in this convention. The first session will focus on 'Strategies to Overcome Challenges in Marketing to the Bottom of the Pyramid,' the second on 'Creating Products and Services for the Bottom of the Pyramid' and the third on 'Creating Consumption Potential at the Bottom of the Pyramid' followed by competitions for students.

This will be followed by a Business Plan Competition. The competitions are open to business and management students from all over India and the total prize money is Rs.1.5 lakh.

The idea behind this event is that 'Corporations, more than Government, should play a bigger role in developing the Bottom of the Pyramid.'

For more details contact the Madras Management Association at MMA House, 148-K Old Mahabalipuram Road, Thoraipakkam, Chennai 600 097. Email: mma@vsnl.com or by phone 044 - 2496 2766.

Via The Hindu

We at WRI's Markets and Enterprise Program (which powers NextBillion.net) are happy to welcome Abigail Keene-Babcock to the team.  She will be a staff writer for NextBillion.net, among other research duties.

Abigail joins WRI as an intern working in the Markets and Enterprise Program. She is interested in exploring market-based solutions, patient capital, innovative technologies and social entrepreneurship as tools for creating sustainable and measurable impact in poverty reduction, and in the wise stewardship of natural resources.

She received a B.A. in Political Science from Yale University, where she also focused in International Development and Latin American Studies.

Prior to joining WRI, Abigail interned with Acumen Fund in NYC.

Knowledge @ Wharton published an article on the living conditions of India’s rural poor, and on the shortcomings of central and state-funded government housing programs. The author, Abraham George, maintains that the primary reason for failure is an exclusive focus on providing low-cost shelter, without consideration for interrelated factors that determine actual effectiveness.

However, it’s also important to realize that even a strategy that convinces government to build more “complete” housing may also fail. Ownership and active involvement in the building of a new community are some of the strongest mechanisms that exist to ensure the highest positive impact on quality of life.

More consideration should be given to sparking and supporting locally-based, private initiatives that work with market forces and are directed for and by the poor.

To read the full blog, click "read more."

The latest issue of one of my favorite journals - Stanford Social Innovation Review - is out; they only have 4 issues a year, so I get really excited when the new issue comes out. There are a couple of interesting articles in the Fall 2007 issue addressing both the non-profit and the for-profit worlds that I would like to comment about:

Jessica Flannery, Kiva’s co-founder wrote the article "Micro-franchise Against Malaria" on HealthStore’s micro-franchising model. This model has proven to be very effective; according to Flannery it "…has allowed it to deliver good healthcare while aggressively expanding. Founded in 1997, the foundation has opened 65 CFWshops. In 2004, the HealthStore network treated 177,256 patients. By 2005 that number had nearly tripled to 435,527. As a result, CFWshops’ distinctive black and red signage has become a beacon to the sick and poor throughout Kenya." Of course, WRI managed the first case study on HealthStore’s model back in 2005 – check it out in the Case Studies section.

It’s interesting to see that for-profit clinics and micro-franchising are starting to be a ‘hot topic’ in development discussion channels. HealthStore is not the only company taking the micro-franchising approach; we have covered a lot of these types of business models here on NextBillion, including Living Goods in Uganda, Mi Farmacita Nacional in Mexico, MicroClinics, CareShops, and MicroBusiness for Health in Ghana. These for-profit clinics and businesses help address the health care problems in poor countries and rural communities such as CFWShops does in Kenya.

Side note – Jason Fairbourne of BYU’s Microfranchise Development Intitiative tells us that his book, Microfranchising: Creating Wealth at the Bottom of the Pyramid, is now available. A pity that, at $99 per copy, it is more or less inaccessible to those it profiles.

Another article in this issue of SSIR is by Beth Sirull. "Private Equity, Public Good" talks about the new private equity firms that are focusing on ‘development investment capital.’
Many businesses serving lower income communities languish because they cannot raise enough money to fund their growth. To meet their needs, a new breed of private equity investment—development investment capital—has emerged. Not only does development investment capital fund growth and social benefits in lower-income communities, it also gives investors a competitive return on their investments. Although this style of investing is still in its infancy, it is already showing promise.

It’s a really interesting article because this new approach of development investment capital is proving to be doing good and doing well. There are many underserved communities and businesses that can enjoy market-rate returns and workers and investors will both benefit.

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