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Some months ago, I commented in one of my posts on the winning photos of CGAP’s Microfinance Photography Contest 2008. In my opinion, this contest was useful because it served as a reminder of who the final microfinance customers are: a woman drying corn, a camel owner, a farmer tending her strawberries or a young girl preparing radishes to take to market.

CGAP is now accepting entries to their 2009 contest. For those with an artistic flair their deadline is on August 14th. Good luck!

Guest writer Philip LaRocco has over thirty years of international and U.S. development experience.  He is the co-founder of E+Co, the leading practitioner of the enterprise-centered model of investing in energy enterprises in developing countries.  He retired as E+Co’s Executive Director and CEO on April 30, 2009. 

An Open Letter to the "Development Posse" (of which I am admittedly a member):

The Development Posse needs to lighten up. Stop being so serious and sincere. It makes you-all (we-all?)ineffective. Being serious makes us focus on what's the right thing to do rather than the practical things that need to be managed to make real change. Things such as vested interests, career ambitions, empire building and the regular need for certain people to attain rock star status regardless of the validity of what they preach.

Stop being so damned serious. Laugh at and openly discuss the silliness that pervades so much of development. It will make the conversation so much more interesting. Share your latest "you cannot make this sh*t up" example. I'm listening.

While you are at it, stop being so sincere. Repeat after me: nothing works as planned. Thinking it should (work as planned) leads to whining, drama and trying to make water run uphill. When stuff inevitably happens, folks, make the course correction and acknowledge it. Don't paper it with nonsense such as "market circumstances reduced the demand for the fund-project-programme's carefully designed products-services-intervention" - when the truth is that the investors and donors got cold feet and backed out.

The people we purport to serve - the unserved (without whom most of us would be tending bar) - really don't want our pithy explanations. Actually they don't even want our projects or programmes. What they want, folks, is choice. That's job one. Not inputs, outputs, outcomes, measures, strategy, tactics or cost-benefits. Our job is to be less sincere, less certain, more agnostic and do those few things that eliminate barriers to choice. We should be avoiding the cliches (Does it scale? Hell, let's first ask: does it work?). Let's share stories of what works at creating choice for the poor who employ us. I'm listening. 

Phil LaRocco writing as the Dark Green Geek (philip.larocco@eandco.net)

Last month, Wired hosted a conference called "Disruptive by Design," the first conference that I know of focused mostly on disruptive business models. In talking about Disruptive Leadership, I have often emphasized that a disruptive business model must accompany the disruptive innovation when addressing the bottom of the pyramid. CK Pralahad talks in detail about this in the Fortune at the Bottom of the Pyramid.

One of the featured speakers was Jeff Bezos, CEO of Amazon. Given the success of Amazon's Kindle and its impact to the "business model" of the publishing industry, that was the primary topic of discussion. You can watch Jeff's entire talk on Wired's conference site (as well all the other speakers). I myself got a Kindle a few months ago and haven't read a physical book since. I absolutely love it. It isn't just the slick design (it looks and feels like an Apple Ipod/Iphone), but I was floored by how easy and fast it was in getting it setup and buying and downloading my first e-book. It literally took me two minutes from start to finish, from opening the package, going online (through their Whispernet wireless service in a parking lot somewhere), searching for a book I wanted, buying it, downloading it, and getting to the first chapter).

So what does this have to do with "next billion?" The device is expensive at ~$400 -- far out of reach of most. Amazon's online store is primarily a mature market phenomenon.

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I wrote before about standing in a room with dozens of MDs sitting at terminals in the world's largest medical call center. Together with an even larger group of lay health workers, they advise thousands of patients per hour. Costs per patient are so low that I described medical call centers and telemedicine approaches as the future of medicine. But that's only part of the story.

Last week I stood in another room in India where perhaps 15 women in clean-room garb were assembling point-of-use rapid diagnostic kits-these were pregnancy tests, but the company makes similar diagnostic kits for malaria, dengue, hepatitis, HIV, glucose levels, etc., more than 30 in all.  Two women dip sheets of special paper into an antibody solution; two more ran a specialized paper cutter to slice the medium into thin strips; still others assembled the strips into plastic housings, sealed them into foil envelopes, inspected the product carefully, and packed them into cartons. 

These few workers turn out about 50,000 "strip test" kits a day. These could be used by consumers directly-most require putting 2 drops of urine or blood or plasma on the strip test and watching a few minutes until it give as "yes" or "no" signal-but are more accurately handled by a lay technician. And here is the key point: Most of these kits sell for less than $.10 each in India (including supplies, labor, packaging, shipping, and profit).  The kits have a built-in error check, are stable for 2 years at room temperature and below, and the company has data to back up a claim of high reliability. And this is not the only company in India making these kinds of diagnostic kits.

But that's today. Next door to the diagnostic assembly building is the company's newer facility, where automated production machinery is being installed that will lower production costs significantly, to mere pennies a test.  So imagine that you could walk into an "instant clinic", get tested in 5 minutes for an insignificant cost, talk to a doctor in a medical call-center about the results if you desired, pick up the medicine you need, and leave-within 20 minutes. Of course, in an industrial country, the price will be higher; the labor for the technician (30 seconds to perform the test, 30 seconds to tell you the result) probably will cost more than the test itself, not to mention shipping, customs duty, FDA approvals, etc. But the result is still a radical shift in the cost paradigm for healthcare delivery.

Within a few years, more sophisticated diagnostic devices will be available too-a "lab-on-a-chip" that analyzes the DNA in the sample and gives a digital readout, at a cost of perhaps $1-$2 a test. We are tracking a pipeline of a dozen such diagnostic devices now in development covering a wide range of diseases and health problems.  But it is hard to escape the feeling that the women I visited last week are the pioneers, already shaping the future of healthcare in a fundamental way.  We will be using their products and tele-medicine in the remote rural part of India (6 hours by train from the nearest airport, plus another hour by car) where we are launching a novel approach to healthcare services.

We may not care in the U.S. whether a test costs a dollar or a dime or a penny-any of those would constitute a revolution of the type the Obama Administration is looking for-but there are 4 billion people in the world for whom low-cost diagnostic kits can be truly transformative, and for whom the difference between a dollar and a few pennies may just determine whether they seek medical care for themselves or their children. 

In its February edition, Fast Company featured a fascinating piece about the way innovation seems to be increasingly "trickling up" from developing nations towards industrialized ones, and not the other way around. Indeed, business models that are able to adapt themselves to work and be profitable in base-of-the-pyramid contexts achieve dramatic costs and efficiency improvements that make them highly attractive for ToP markets.         

While effectively describing the shift in itself, the article doesn't go very deep in explaining how these innovations actually surface in low-income environments, what methods are used or which economic agents are leading the process. Some BoP literature, however, provides examples that underscore the importance of co-creating products and services with the BoP. This includes the well known Base of the Pyramid protocol and even the most recent publication of BoP and innovation thought leader CK Prahalad, who praises for co-creation with customers in his 2008 The New Age of Innovation: Driving Cocreated Value Through Global Networks.

What about concrete methods to make co-creation / innovation from the bottom-up happen? The recent popularity of competitions seems to offer an interesting method. Interesting, fun and (increasingly) popular as they are, the case still seems to be that they do not capture much attention when the challenge at hand requires them to take place in low income communities and among low income dwellers. At least that was my takeaway after reading Rob's piece about the Incentive2Innovate conference which apparently had all the prize and competition masterminds under one roof.

Well, it seems that knowledge and lessons from prize- and competition-led innovation at BoP level is well on its way. I recently had the pleasure of meeting and spending some time talking to Aline Kraemer, who recently conducted related research in the shanty towns of a major city in Brazil. A PhD candidate at Munich's Technical University and partner at the Emergia Institute (a think tank, research center and consultancy based in Berlin, Germany), Aline recently spent four months in Curitiba (Brazil) at the Research Center for Design and Sustainability of the Federal University of Paraná.  She led a fascinating process that involved working with low-income communities in the rural surroundings of Curitiba, running an idea competition to identify viable product ideas with potential to address the urgent need of many people to increase their (perceived) living space.  

The project was initiated by the recycling company Soliforte Reciclagem Ltda, a venture currently planning to offer specific products related to social housing liaised with Research Center for Design and Sustainability (Núcleo de Design e Sustentabilidade - NDS) of the Federal University of Paraná (UFPR), having received funding for the project from the Brazilian Innovation Agency (FINEP) and Fundação Araucária. 

I could go on for a while about my conversation with Aline. However, I thought it would be more interesting for you to hear about her research in her own words. Without further ado, here is NextBillion.net's interview with Emergia's own Aline Kraemer. 

Editor's note: Find a summary of Aline Kraemer's bio and a set of pictures of the project at the end of this blog post.

Francisco Noguera, NextBillion.net: Why did you decide to focus your academic research on competitions and open innovation at the BoP? Whose previous work/ research influenced your decision?          

Aline Kraemer, Emergia Institute:  Starting to research on products and services that were created for low-income consumers, I came across many well conceived products that were not accepted by their target group. I started to ask myself why so many new products fail and the answer I found was very simple: we often know very little about low-income consumers' needs, about how they use a product, how they make decisions and why they accept a certain product or reject another. This is mostly tacit information that can be difficult to grasp.

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Yes, another social enterprise conference is around the corner, and you're thinking, "Do I really need to be there?"  I hear you.  A friend of mine came back from a conference the other day complaining that the panel discussions were endless self-promotional shills (typical) and there was hardly any time for real learning, discussion, debate and development (also typical).  Even worse, the coffee breaks were short and there was no networking reception, so all she got for her trouble was an e-mail box full of unanswered messages and tired feet from walking around in a business suit all day.

In this light, I hear about SOCAP09 and my first reaction is, "So what?"  Otherwise known as, why bother going?  Well, I AM going, and in the interest of transparency, here are the 3 reasons why you need to be there, too.

Reason #1: It's the people, stupid

Conferences are learning experiences, to be sure, but you go because face to face interaction is more important than ever in a hyper connected world.  You simply can't substitute Twitter and LinkedIn and blogs (except this one, of course!) for the real action that happens when you meet face to face.  So if you're looking to travel all the way to San Francisco, you'd better expect to meet the right people.  And SOCAP09 is looking like it will deliver on that.

I've had a sneak preview of the partial attendee list, and trust me, SOCAP09 will be a good mix of investors, practitioners, foundations, government, and NGOs.  But more investors than a typical social enterprise conference...which raises the bar for everyone else.  Check the SOCAP09 site for their featured attendee story - updated regularly - to get an idea of who's actually coming.  What's more, NextBillion will be running a short pre-conference series on BoP players coming to SOCAP (stay tuned...).

Of course, it doesn't matter that the right people are in the room if there's never time to network.  SOCAP's schedule includes plenty of time for informal discussions and the Fort Mason Center lends itself to side meetings, if that's your thing.  In short, if you're coming to SOCAP, bring lots of business cards - you're going to meet the right people.

Reason #2: From 101 to 301/401

I've been to many conferences where the content stays in the introductory (Social Enterprise 101) mode and never gets into the meaty discussions.  I think that there were some good 101 panels at last year's SOCAP08, but from the looks of the panels and plenaries this year, SOCAP09 is stepping up to the next level, maybe even beyond.  It's incumbent on the panel moderators to ensure this happens, but so far, Kevin Jones has this set up for success.  What can you expect?  Deep discussions along the lines of "What next? Is this real? Can we measure it? Can we value it? Who else is doing it? What failed?" and more.  In short, the serious, 301/401 level stuff.  Nathaniel Whittemore at Change.org gives a good schedule overview; check it out (and the actual schedule) for details.  Of course, if you're looking for an intro into the social capital space, maybe SOCAP09 isn't for you - unless of course you spend the next few weeks boning up on the basics, using Change.org, Social Edge, NextBillion and other online resources as a starting point.

Reason #3: If you don't like it, you have no one to blame but yourself

Yes, that's right - it's YOUR fault.  Well, not really, but if you go to SOCAP09 and complain that your issue/passion was never discussed, then it really is your fault.  That's the beauty of Day 3 at SOCAP09 - the Unconference.  It's a day where participants sign up to lead sessions and the conference is essentially organized chaos.  But as we know from wikinomics and crowdsourcing, this kind of open it up and see what happens mentality can lead to some strong outcomes.  Personally, I hope that many of the presenters from Day 1 and Day 2 will stick around to be participants on Day 3 (I know I will) and see where it all goes.

So there are MY 3 reasons for going to SOCAP09.  What are yours?

E+Co, a leading clean energy investor for the BoP, recently announced the launch of their latest initiative, the Invisible Schoolhouse. The Invisible Schoolhouse offers an online learning portal and distance learning services for energy entrepreneurs in developing countries. Workshops will be offered in Senegal, Tanzania, and Ghana this summer and will offer courses on clean technologies, finance, accounting, and other business basics.

With the launch of the Invisible Schoolhouse, I was reminded of several other online portals connecting entrepreneurs, experts, consumers, and more. The ICT for Development (ICT4D) space is producing some much-needed websites, resources, and offline initiatives. Just recently I learned about Elevyn, an online marketplace for microentrepreneurs to sell their crafts. I have my own initiative to connect the BoP to consumer researchers and job opportunities through an online platform, BOP Source, which is now being used by the BoP in Nepal's Telecenters. In other words, "the BoP are signing in."

(Full disclosure: I am the founder of BOP Source.)

Bal Joshi of Thamel.com has been using ICT as a way to connect the BoP to resources for over ten years. Thamel.com is a success story, the likes of which many are trying to replicate. And now he's piloting VOIP, virtual ATM machines, and more throughout Nepal. Nepal, having some of the poorest infrastructure in the world, especially regarding ICT, is one of the most challenging places to work as an ICT4D entrepreneur, and yet the country seems to attract ICT4D entrepreneurs and is relatively open when it comes to trying new experiments.

In the many conversations I've had with Bal, I've always observed a passion, optimism, and patience in him - the last quality being especially important in this country. Finding the right people to partner with and seizing the moment seem to be a trademark of Joshi's success, two facets I anticipate E+Co will also strive to develop for the Invisible Schoolhouse. I look forward to learning more about the infrastrucutre challenges and solutions in the countries where E+Co's Invisible Schoolhouse resides.

So maybe Mr. Joshi will start the next online learning center for ICT4D entrepreneurs. Or maybe someone else will. Either way, additional specialized learning centers would be a tremendous contribution to our field. Why not create global online learning portals for health, agriculture, education, water, sanitation, and other areas? I'm sure such resources already exist and I'd love to hear about them if you are involved in any way.

The challenges are many, especially related to literacy and language, and that is perhaps why several learning portals already exist for specific geographic communities, such as Ashoka Fellow Mahabir Pun's Nepal Wireless Networking Project Village Bulletin Board, a BoP Source partner. But with the rise of social networking sites and in the words of one entrepreneur here in Nepal, "There are already Sherpas working on Mt. Everest with Facebook profiles," it seems that the barriers for a global online learning, marketplace, and networking center are quickly shattering. I look forward to following the development of E+Co's Invisible Schoolhouse and I hope to hear from some of you soon with additional ICT4D initiatives.

As a 2009 Global Graduate Research intern, I've had the opportunity to join the efforts of one of the leading social entrepreneurship organizations in action today.  It has been a refreshing break from the abstraction of classroom discussion and has exposed me to some of the fascinating fieldwork being done at the "base of the pyramid."  The focus of my work with Ashoka has been to catalogue and analyze social-business collaborations targeting the BOP in Africa.  While I haven't yet completed my research, I thought I would take some time to share my impressions of this realm of BoP activity in Africa with the rest of the community.  I will look forward to reading your comments.

Ashoka has been active in the BoP space for quite some time.  Much of their efforts have been devoted to the development of the Hybrid Value Chain^TM (HVC), a concept Ashoka has put into practice since 2003.  HVCs are "...business models for commercial partnerships between businesses and citizen sector organizations that leverage the critical strengths of each actor to transform markets" and meet the needs of BOP producers and consumers through increased market access.  Unlike some social-business collaborations, which may be purely contractual in nature, HVCs have mutual value creation at their core.

The goal of my research on Africa has been to identify these types of collaborations and learn what made them work (or what caused them to fail).  So far, I have been able to find about 67 cases and while there's still more work to be done, two clear trends seem to have emerged.

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IFC recently issued Safe Water for All, a thorough and illustrative report about the opportunities for the private sector in delivering clean water to the base of the pyramid. It sheds light on many of the topics covered in the review published here in NextBillion back in 2008, such as the challenges of pricing and distribution for Point of Use devices at the BoP and the many different approaches (in terms of business models, legal structures, technologies, partnerships, etc.) that can be seen in community scale models such as those of companies like EPGL, Naandi and WaterHealth International, three of many actors that have helped make this a fast-growing phenomenon in that country.  

The report offers concrete recommendations to help drive these approaches to scale, many of which are concerned with the issue of offering flexible financing alternatives for entrepreneurs and for potential customers alike. However, there's an issue that comes across with even greater frequency throughout the report, and it is that of design considerations for clean water solutions at the BoP. Though technologies are already out there capable of dealing with most of water quality issues, close attention must be given to cultural and behavioral patterns, which are most relevant when it comes to a resource like water.      

By offering an overview of available alternatives for water treatment at the BoP (as well as useful country profiles that characterize the opportunities for water-related ventures in various regions), IFC's report fills a gap that existed in this space's literature. However, the issue is so acute that it merits similarly thorough pieces providing in-depth analysis of the different angles of the water issue in low income communities. (We'll be publishing an updated piece on community scale approaches during the fall so stay tuned for that.)  Besides, we should be swift and start discussing the role of enterprise in dealing with tomorrow's water challenges.

Indeed, entrepreneurial approaches seem to be gaining traction in some areas, dealing primarily with today's challenges of water quality and sanitation. A changing climate, degraded ecosystems and a growing population are the input variables. What are the foreseeable consequences in the availability and quality of water resources? Does enterprise have a role to play in low income settings? Yesterday's too late to start this discussion.

So while you read their water report, I'll get started on another piece by IFC concerned with mitigation and adaptation to the effects of climate change. Maybe it'll shed some light on these questions. 

I am an unlikely choice to judge the final round of an event that touts itself as the "world's premier student technology competition".  Ask any of my tech-savvy and much younger co-workers - and when they stop laughing at the thought -they will undoubtedly and forcefully concur that I am technology-challenged.  But there I was, one of five judges that came together in Cairo at the beginning of July for Microsoft's Imagine Cup 2009 Worldwide Finals. 

For the more cynical, Microsoft's investment of millions of dollars to plan and stage this event is a good way of getting college students focused on IT hooked on its products, if they aren't already.  But for me, a true believer in the power of markets as an instrument of positive social change, the event's most important outcome was getting IT students to realize excitedly that, as one team noted, "it is not just about writing lines and lines of codes and making money... it is more about creating a human solution touching communities and making a difference".  So Kudos to Microsoft!  

But why did I agree to participate, given my technology handicap?  Well, I find working with college and graduate students as exciting as working with entrepreneurs with a social mission.  Why else would I have agreed to head up Oxford's Skoll Centre for Social Entrepreneurship at Said Business School after a decade of identifying the world's leading social entrepreneurs and their exemplary teams? 

For me, it is equally energizing to be with the leaders of the future as with the innovators of today.  And while my focus is on MBA students and the business school curriculum, which as we are painfully aware desperately needs to change, it was enormously exciting to realize that thousands of university students specializing in IT are also keen to apply their talents to addressing some of the world's most important challenges[2].

And I only saw a small fraction of the finalists - the five that were in the "Design for Development Award".   Their focus was to create a software solution that is accessible and relevant to the 5 billion people who live on less than US$8 a day.   With the UN Millennium Development Goals as their North Star, students were challenged to "Imagine a world where technology helps solve the toughest problems facing us today". 

So who were the finalists?  As one who spent over a decade in the area of public health, I was delighted that three teams had chosen to focus on health - and two on environment, which is of course strongly related to health. 

For me, the most innovative was Unique Studio, the team from China's Huazhong University of Science and Technology. This impressive group of four 18 to 22 year olds had invented an embedded device hooked up to a stethoscope and a basic mobile phone. It allows rural doctors in remote regions to diagnose childhood pneumonia, one of the biggest killers of poor children, mainly because rural doctors do not have the expertise to diagnose it.

This cheap and easy to use device allows the rural doctor to collect the child's lung sound and transmit it through the mobile phone to an expert -usually working in the city - who conducts the diagnosis by receiving the mobile signal with a computer and analyzing the results- telemedicine meets the mobile phone. 

What motivated them to pursue this path?  One of the team member's four year old cousins living in the countryside died of pneumonia while the team debated which of the 8 Millennium Development Goals to pursue.  That clinched the decision.  And as they worked and refined the technology and saw its impact among those rural doctors and experts who were testing it, they became more committed to ensuring they deployed the solution.  Next steps?  Piloting it in the hospital attached to Tongji medical school. 

The most amusing presentation - and perhaps the most widely replicable technology - was created by Cosmic, another team of four students, this time from Universiti Sains Malaysia. Their challenge?  The health system's reliance on paper-based vaccination records and in-person visits to remind parents about missed vaccinations, a costly and ineffective system resulting in a high number of vaccination defaulters.  The team had come up with a highly replicable web based immunization registry which allows for local health workers, doctors and nurses to manage immunization records and send vaccination reminders to parents via SMS.  It also provides easy retrieval of vaccination records by healthcare providers and individuals worldwide via the website or SMS - which to date has been a nightmare.  I could certainly see this tool as one that could be implemented widely, not just in Malaysia!  (Team Cosmic was the eventual winner of the award).

The other groups included a Ugandan team with a solution for farmers and traders to buy and sell crops through an SMS based auctioning system as well as providing weather forecasts, market information and agricultural advice via SMS; an Indonesian team with an SMS system that reminds TB patients to take their daily medication; the approach includes motivational messages and a help line where patients can get answers to TB-related problems via SMS.  Finally, Capricorn, the second Malaysian team, gave a powerful presentation on their online and offline application of agricultural information and alerts to farmers via SMS. 

But there was one aspect that was less well developed in all five presentations - and which justified perhaps my being on this distinguished judging panel.  To a greater or lesser degree, each team needed to focus more clearly on its business model.  While it was exciting to see how these projects were leveraging the SMS and voice capabilities present in basic mobile phones to solve problems of the poor, it was not clear how these projects would be implemented and become financially sustainable.

And this is where the current crop of 'socially-committed MBAs' can help (that is no longer an oxymoron).  The critical need for multi-disciplinary teams to come up with simple, effective, user-centered, replicable and SUSTAINABLE solutions to challenges of the current and future billions is more urgent now than ever before.  Perhaps next year's Imagine Cup can include IT teams with MBAs?

Imagine that??