Irvine, Calif.-based WaterHealth International [1] is planning to install water purification and disinfection systems for 600 communities across India, funded by a $15 million project finance round from International Finance Corp. [2] this week.
IFC, a division of the World Bank, has previously invested equity in WaterHealth International to grow the business. But this new cash infusion will allow WaterHealth to quadruple the number of decentralized units up and running in Indian communities, said Tralance Addy, CEO of WaterHealth International.
"India has 600,000 villages that would fall into this category where we would want to improve the water conditions," Addy told the Cleantech Group today. "So 600 is a drop in the bucket."
Organization: The Safe Water and AIDS Project (SWAP) is an organization that provides women with HIV/AIDS a range of services (counseling, emotional support, paralegal assistance, health and nutrition education) as well as income generating activities. SWAP also provides support to AIDS orphans.
Description: SWAP has received significant financial support; the Rotary Club of Atlanta and Rotary District 9200 of Kenya began supporting SWAP over 3 years ago with the goal of reducing waterborne disease and providing SWAP members with the means of earning much needed income. In this program, local SWAP groups are trained about safe water, health, and good business practices, and are offered the opportunity to obtain microcredit. The women become "Avon Ladies" for health, selling WaterGuard, PUR, modified clay pots, insecticide treated bednets, condoms, protein fortified flour, skin antiseptic, birth control pills, and other products, and keep a small commission. This project enables the women to improve the health of their neighbors while earning money to support their families. There are approximately 400 SWAP groups, mainly women, who sell health products throughout Nyanza Province. Promotion and marketing of the products primarily occurs by word of mouth through the various group members in their respective communities.
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Editor's note: Guest video blogger Karthik Janakiraman is an Acumen Fund Fellow. This year, Karthik is working with Global Easy Water Products (GEWP), an company in India providing poor farmers with access to affordable micro-drip irrigation solutions. He will develop a production, inventory and logistics plan, while also building and refining GEWP's export strategy.
Before joining Acumen Fund, Karthik was a Senior Engineering Manager at Applied Materials in Santa Clara, California, responsible for new product development. He has been awarded five patents in the area of semiconductor design. Karthik holds a Master of Science degree in Mechanical Engineering from the University of Michigan.
Video blog by Karthik Janakiraman
During my first week in Aurangabad, I went to the agricultural fields and met a few customers of GEWP. One of them in particular, stood out. This short video captures my thoughts and impressions on that meeting.
As chief executive of Mercy Corps since 1994, Neal Keny-Guyer helped turn the Portland (Ore.) relief organization into a global powerhouse with 3,500 employees and a budget of nearly $300 million. But he was taken aback last year when one of his lieutenants proposed the radical step of buying a bank in Indonesia. Why would a not-for-profit disaster relief agency go the capitalist route and buy a bank?
Tralance Addy knows all too well what can happen to people if they run afoul of dirty water. When his company, WaterHealth International, was shooting a video to promote its water purification systems for rural villages, he posed beside a lake near Hyderabad, India, that was none too clean. The video producers suggested he reach down into the lake and let the water run through his fingers. Which he did. Unfortunately, he forgot to wash his hands immediately afterward. A few hours later, he became violently ill and had to be hospitalized. He didn't completely recover for six weeks. Says Addy, 63: "We were trying to demonstrate something about bad water, and I really did it."
I'm writing from Cartagena, Colombia, where "The Business of Inclusion" conference will take place later this week. The conference is organized by the Inter-American Development Bank, and the Multilateral Investment Fund (FOMIN) and NextBillion has been invited to cover the discussions that will take place during the next few days as a media sponsor. As someone whose interest is contributing to a stronger and more maningful development-through-enterprise movement in Latin America, I am grateful for this opportunity.
There are two aspects of the conference I am particularly excited about. First, WRI will co-host a panel on Friday, in which we want to highlight creative and entrepreneurial solutions to some of the most pressing challenges faced by our society. Also hosting the panel will be AVINA, one of the largest private foundations in the region, and FUNDES, a key actor in the local enterprise development space.
The three organizations form the Network for Inclusive Markets, through which we intend to identify scalable business models serving the base of the pyramid in key sectors and mobilize key actors for their implementation in Latin America.
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(Editor's note: Today, November 19, is World Toilet Day, part of an awareness campaign led by Water Aid. This post is timely to stop for a second, think about and learn more a crisis that keeps 2.5 billion of the world's poorest citizens away from basic sanitation services)
Guest blogger Mike Pezone is a returned Peace Corps volunteer from the Philippines and a 2nd year MBA from The Johnson School at Cornell University. He focuses on Base of the Pyramid business models at Cornell's Center for Sustainable Global Enterprise. This past summer he worked in Mexico conducting the BoP Protocol to develop a water purification business model for an early stage startup.
By Mike Pezone
Water touches everything. This was reflected in the diverse backgrounds and interests of the panelists at the Saturday morning session about "innovative solutions to water and sanitation challenge". Hailing from different corners of the water problem, panelists included Mikkel Vesterdaard - CEO of the company that created the Life Straw, Andra Tamburro - Program Director at Water Advocates (the first nonprofit organization dedicated to increasing American support for the global water problem), and Jeff Seabright - VP of Environment and Water Resources at the Coca-Cola Company.
Stan Laskowski, President of the Philadelphia Global Water Initiative Board moderated an engaging session between panelists and participants. In my opinion the panel was less a discussion on innovative solutions and more of a call to action as each panelist cited statistics reminding us of the gargantuan scale of the current water crisis.
1,000,000,000 people lack access to safe drinking water
2,600,000,000 people lack access to proper sanitation
50% of the schools in developing countries lack access to clean water
75% of the schools in developing countries lack access to proper sanitation
Every 15 seconds a child dies from a water related illness
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Today I am posting the results of a unique partnership and a novel experiment in furthering social entrepreneurship, the fruits of an effort launched on this site a year ago.
The idea was to extend the scaling impact of the GSBI by recruiting a cluster of social enterprises within a single sector for the 2008 class, to add research on the sector as a whole, to involve water experts as well as the silicon valley VCs and CEOs in mentoring process of the water enterprise cluster so as to use them to provide a preliminary benchmark for the sector-and then to share what we learned so that other water entrepreneurs worldwide could build on that knowledge.
The sector cluster was planned as 6 enterprises but, in the end, was only four (things happen!), so the database is less robust that we had hoped, and our conclusions must necessarily be more tentative. Yet it is clear to us that we have identified scalable models-both business models and low-cost technology-that are likely to be of use elsewhere.
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Paul Polak is wearing a sweater vest. This will come as no surprise to anyone who’s met him or seen him speak. The man loves sweaters – cardigans, sweater vests, pullovers. Hell, in Camden today – with temperatures hovering around 40 degrees in the midday sun – Paul’s sweater makes a lot of sense. But despite his grandfatherly image, Paul is a truly a young, tireless innovator and entrepreneur at heart.
Polak is the founder of the non-profit International Development Enterprises (IDE) and the author of Out of Poverty (review here). He is dedicated to developing practical solutions that attack poverty at its roots. For the past 25 years, Paul has worked with thousands of farmers in countries around the world to help design and produce low–cost, income–generating products that have already moved 17 million people out of poverty.
His goal - like Bunker Roy's - is to create a franchise of barefoot, women microentrepreneurs based on the ruthless pursuit of affordability. Polak suggests that a company could set up a water kiosk where entrepreneurs could sell water at an affordable price, profitably. (Sounds familiar!)
He starts his presentation with some seemingly random facts – 200 million Americans have hemorrhoids; men talk on cell phones 16 percent more than women do. His point: we know everything we need to know (and more) about affluent consumers. But we know next to nothing about the other 90 percent of the world's customers.
Serving these customers means re-thinking business. But it also means re-thinking development. To do so, Polak has based his work on what he calls the three great poverty eradication myths:
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Luckily there are live webcasts for the rest of us who were not able to sit at the sessions and ask questions during the sessions at this year's Clinton Global Initiative. I have spent a handful of hours during the last few days browsing around the content of this year's CGI, listening to some of the panel discussions and trying to get a feeling of the venue's commitments, which are its cornerstone and measure of future accountability.
However, I was able to recruit a great guest blogger that sat in many of the sessions at CGI. Stay tuned for her posts about the venue later this week. (By the way, if you are interested in a more detailed coverage of CGI make sure to take a look at the good job done by Philantopic live-blogging the conference).
Today I just want to highlight one of the sessions that discussed the challenges of clean water, sanitation and hygiene, which have become a passion of mine as I've had the opportunity to dive deeper into them over the last few months. Here are a few takeaways but I encourage you to watch the full video.
Community-scale water treatment: The promise of decentralizing access to vital services
One of panelists was Mr. Tralance Addy, President and CEO of WaterHealth International. His presence in the panel signaled the increased relevance of an approach that is successfully in bringing safe drinking water to millions in rural communities all across India: community scale water treatment.
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This year, the Global Social Benefit Incubator at Santa Clara University piloted an approach to capture and diseminate systemic knowledge about community-scale water treatment and sanitation. Four of the entrepreneurs this year represented projects that address these challenges. Deepinder Mohan, founder of Environment Planning Group Limited, is one of them.
EPGL is bringing an affordable and reliable source of clean and safe drinking water to rural villages in India using reverse osmosis technology. With support from Acumen Fund EPGL has reached a scale of 35 plants in operation and envisions a rapid growth to achieve its vision of 5,000 plants by 2013.
Attaining this vision will demand heavy investment but I don't believe that will be EPGL's biggest challenge. Demand will continue to grow and RO technology is proven to be effective. The economics of the model are viable and sustainable. Moreover, the number of investors and funds in this space will most likely continue to grow, following the steps taken by Acumen Fund. So no, EPGL's long run success will not be a question of access to capital.
In stead, it will depend on it building a robust organization --one with a clear vision and strategy, well defined and efficient processes, a robust talent and technology base, strategic partnerships, and an adequate organizational structure-- that can transcend Deepinder's vision and leadership and turn into institutional skills and values that will continue to improve the lives of the Indian poor in the longer run.
I very much look forward to keeping track of this tenacious entrepreneur and the growth of his remarkable venture.
The country’s largest consumer products company by turnover, Hindustan Unilever Ltd, or HUL, plans to launch Pureit, its water purifier brand, in rural markets by year-end, targeted at relatively well-off village households that are able to afford its recurring cost.
The product is something people everywhere need, but is often costly or – for more than a billion people worldwide – simply unavailable. It has to be produced locally on a daily basis. And the market price, in rural India, is less than $20 per household per year. An impossible business? I say no; in fact, I'd argue that this is a classic base of the pyramid business opportunity: low-margin, high volume; leveraging advanced technology; scalable; and potentially very profitable.
I'm talking, of course, about clean water for drinking and cooking. And two of the businesses I've been mentoring at Santa Clara University's Global Social Benefit Incubator have already achieved proof of concept for this market. Environmental Planning Group Limited (EPGL) is a fully commercial entity operating in Gujarat state. The Naandi Foundation is an NGO that partners with the government but operates with business-like efficiency and is already starting to scale in several states outside its Andhra Pradesh base. Both deploy reverse osmosis water treatment plants, primarily in rural villages that do not now have access to clean water.
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"...you can have the very best technology in the world, and if you don't get it out there and market it, if you don't have a distribution network, then it doesn't have any impact."
Creating markets at the base of the pyramid is hard work. This theme that has resurfaced again and again in my recent work, whether at a gathering of budding BoP-focused entrepreneurs or during a conversation with established social innovators.
What do we mean by 'market creation'? What role does it play in BoP venture creation? And why is it so often overlooked by entrepreneurs, investors, policymakers and pundits? In this post, I'll touch on these issues by citing examples that have surfaced recently in my work, including insights from the Acumen Fund portfolio.
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Tendai used to be a teacher in his native Zimbabwe, until he saw one of his students died for reasons related to poor water quality. That event changed his life's direction and led him to become one of the founding members of Pump Aid, an NGO that has brought safe drinking water to thousands of villages in Africa by designing and manufacturing Elephant Pumps based on a centuries-old Chinese technology.
Pump Aid is experiencing an interesting transition that explains Tendai's presence at this year's GSBI. In the midst of the difficult and unstable situation in Zimbabwe, it recently re-located to Malawi where the elephant pump has been very successful since its introduction as a pilot project a few years ago. It has also experienced growing demand from households and is moving towards creating a fee-based social enterprise called WISH (Water, Irrigation, Sanitation and Hygiene) that will partner with microfinance institutions to offer the "WISH Package", a comprehensive solution for clusters of households that incorporates clean water (through the Elephant Pump), sanitation (through the Elephant Toilet) and nutrition (through nutrition gardens).
So here is Tendai, whose next steps I look forward to tracking and sharing through NextBillion.net.
NextBillion.net brings together the community of business leaders, social entrepreneurs, NGOs, policy makers, and academics who want to explore the connection between development and enterprise. Read more...
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