"...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."

Martin Fisher, Co-Founder and CEO, KickStart

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.

One in eight people on the planet lives in an Indian village. That's 775 million people, about half of whom live on less than $1 per day.

To Drishtee and its founder, Satyan Mishra, these numbers aren't daunting; rather, they represent an incredible opportunity. Drishtee is franchisor that helps Indian entrepreneurs set up internet-enabled kiosks to provide basic services in their villages. (Full disclosure: Drishtee is an Acumen Fund investee; I work for Acumen Fund.)

Since 2000, Drishtee's network has grown to encompass nearly 1,900 villages, bringing goods and services to about 2 million customers.

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Some time ago, we at NextBillion had the pleasure of facilitating a debate about how - and how much - bottom of the pyramid strategy can improve the plight of the poor. The University of Michigan's Aneel Karnani wrote a very insightful paper critiquing various points about the BoP proposition. This paper then received a response by Michigan's C.K. Prahalad and Al Hammond (then at WRI; now at Ashoka).

Recently, a new critique was published by "Innovations: Technology|Governance|Globalization", a journal we have praised already here. The critique, entitled "The Fortune at the Bottom or the Middle of the Pyramid?" is authored by Anand Kumar Jaiswal, from the Indian Institute of Management in Ahmedabad.

As I read his paper, I found myself agreeing with many of his points, similar to when I read Karnani’s publication. This is because Jaiswal, like Karnani, doesn't refute BoP strategies as a means to approaching poverty problems, but rather contends that reality is sometimes more complex than theory, which is why I find it refreshing to read such articles.

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The last 10 days have been truly exciting ones. I have had the amazing opportunity to participate in this year's Global Social Benefit Incubator at Santa Clara University, a two-week in-residence mentoring program with social entrepreneurs from around the world.

Over the next few days I'll be sharing a few thoughts about the program, its amazing potential and some of the specific challenges that these entrepreneurs face. I will also introduce the entrepreneurs that are participating in the program through a series of short video clips.

Today I want you to meet David Okello, who runs Coast Coconut Farms in Kenya and is improving the lives of rural farmers by adding value to the coconut crop and producing high quality, extra virgin coconut oil. So without further ado, I leave you in the company of David.

It's pretty intense, the process Francisco and I are engaged in this past week and the coming one. Take 16 social entrepreneurs from a dozen countries on three continents, some very knowledgeable faculty, and more than a high-powered dozen mentors and guest lecturers from Silicon Valley companies, and stir well. Throw in 12-14 hour days, hard work improving business plans and elevator pitches, instruction on strategies, etc.

That's the Santa Clara University's Global Social Benefit Incubator. And we are both embedded, as the war journalists say--we talk to the entrepreneurs non-stop, we eat with them, we sleep in the same dorms, we go drinking together.

But even more interesting than the formal program are the informal interactions and unexpected discoveries. These are, after all, entrepreneurs, quick to seize on new ideas and used to thinking outside the box. So the cross learning is amazing. I can only give you my own subset of that, but it's happening all across the entrepreneur group.

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The Center for Sustainable Global Enterprise at Cornell University's Johnson Graduate School of Management is accepting submissions for its 2008 Base of the Pyramid (BoP) Narrative Competition. This short-essay competition seeks to highlight the challenges of implementing business in underserved markets and identify innovative business initiatives or solutions to those challenges.

The 2008 BoP Narrative Competition (PDF) has been created to help identify cutting-edge experiences of business innovation in underserved or marginalized communities.

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I first learned of the Social Capital Markets conference from organizer Kevin Jones, a friend whom I've often run into at various conferences through the years. Last year, Kevin - a principal at Good Capital - began to think that it was time to break down silos and get various 'social enterprise' factions to start talking. The result? A social capital markets conference that's bringing together both well-known and emerging leaders in this sector. (We first wrote about SoCap08 back in July.)

The conference will be held in San Francisco from October 13-15, with speakers including Jed Emerson, Bob Annibale, Premal Shah and Andrew Kassoy. These are just a few of the can't miss folks slated to attend. (I would be remiss if I didn't mention that my Acumen Fund colleague, Sasha Dichter, is also slated to speak.)

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A recent report, "Wireless Technology for Social Change: Trends in NGO Mobile Use," by the United Nations Foundation and The Vodafone Group Foundation highlights emerging trends by NGOs in the use of mobile technology to affect social change in global public health, humanitarian assistance and environmental conservation. While this report offers some great insights on how to use technology and telecom tools to address some of the world's toughest problems, it leaves out one of the most important challenges that NGOs, and most ICT for Development projects face; how toensure sustainability.

To shed some light on this tension, I spoke with Ken Banks, the founder of FrontlineSMS (a tool for mass text messaging) about sustainability and the choices he is currently grappling with. FrontlineSMS was initially funded by Ken's hard work, and more recently by the MacArthur Foundation, to fulfill his belief that "all non-profits, whatever their size and wherever they operate, should be given the opportunity to implement the latest mobile technologies in their work." Today, FrontlineSMS is free for non-profits and is being used by over 40 NGOs in programs around the world.

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Last week, I had the opportunity to sit down with Jordan Kassalow, Graham Macmillan and Miriam Stone – three staff members at VisionSpring – to conduct a long-form interview. Formerly known as Scojo Foundation, VisionSpring is the pioneering base of the pyramid-focused enterprise working to provide access to eyeglasses in low-income communities around the world.

NextBillion.net readers will be familiar with VisionSpring's basic story; after all, our team published a What Works case study on the company back in 2007. We've followed their progress for a long time, up to and including their recent name change and announcement of a 5-year fundraising prospectus.

(Full disclosure: I work at Acumen Fund, which is an investor in VisionSpring.)

Rob Katz, NextBillion.net: How, when and why did you get involved with VisionSpring?

Jordan Kassalow, Chairman and Co-Founder, VisionSpring: It was very practical. I spotted a market failure in my blindness prevention work (I'm an optometrist and public health expert by trade.) For many years, my specialty was river blindness control, and when I worked in low-income communities, I saw more people coming to clinics because they couldn't see up close, while there were relatively few who were coming to us for river blindness. I saw this pattern regardless of whether I was working in Africa, Asia or Latin America. When you're working on blindness, the overall market relative to general eye care is small. The normal need for eyeglasses is strong, but underserved in the developing world. After many months, I finally realized that, if no one else is doing something about it, why can’t I?

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Things are generally slower in August, as many folks take vacation and less gets done by those who are at the office. (For a refreshing and innovative take on this phenomenon, you might consider Seth Godin's advice to work like your hair is on fire while the competition sleeps.)

For the rest of us, this means there's less content than normal floating around the base of the pyramid blogosphere. Despite this, here's a quick roundup of worthy reports and posts:

The GSM Association commissioned a report summarizing the findings of 20 top research papers. It might sound like a glorified literature review, but it's worth your time. This is really the first report to put together, in one place, research on the economic and social impact of mobile phones in developing countries. Jack Ewing of BusinessWeek gives the quick analysis, while Dave Tait at the Emerging Futures Lab provides a handy link to download the 36-page PDF file. From Ewing's blog post:

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This post is the second in a two part series on how to get involved in the base of the pyramid movement. Part 1 was a personal story of involvement, and Part 2 focuses on the role of students in bringing social transformation.

I recently attended the Social Enterprise Knowledge Network (SEKN) colloquium at Harvard Business School and had a conversation with a professor about the role of students in BoP ventures. He left me with this parting insight: "Don't forget - students change the world. Many social movements throughout history have been started and led by students."

It wasn't a surprise for me to hear this at the SEKN colloquium. One of the main objectives of SEKN is to empower business school professors with knowledge, research, and insights on social enterprises in order to influence students -- who will ultimately drive social transformation. "SEKN seeks to advance the frontiers of knowledge and practice in social enterprise through collaborative research, shared learning, case based teaching, and the strengthening of institutional capacities in management education."

During my time at the colloquium, I was able to rub shoulders with a number of HBS professors who had a lot to share about students and BoP ventures. Michael Chu, who teaches a base of the pyramid class at HBS, said his class is always oversubscribed. Another indicator of this enthusiasm on campus is the fact that HBS's base of the pyramid club has the highest membership of all student clubs.

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While attending the SEKN research colloquium a few days ago, I was able to sit down and talk to Harvard Business School Professor Michael Chu. During his tenure at ACCION International, Mr. Chu played a major role in the development of Mexico's Banco Compartamos. He currently co-leads the Ignia Fund, a for-profit BoP private equity fund focused on the Latin American region.

Following is a four-question summary of the notes I took during our hour-long conversation about Ignia and its prospects of transforming the BoP/SME investment landscape in this region of the world.

Francisco Noguera: What is the background of the team behind the idea of Ignia?

Michael Chu: My partner Alvaro Rodriguez holds an MBA from Harvard Business School, and his first job out of School was with ACCION International. He then moved on to be CFO of Grupo Vitro (one of the world's largest glass manufacturers), CEO of Farmacia Benavides (Mexico's largest pharmacy chain) and then CFO of Grupo Elektra. He also held a seat at the board of ACCION. For my own part, I worked for the Boston Consulting Group after earning my MBA from Harvard, and then did leveraged buyouts in the private equity industry with KKR before joining ACCION, by the time Bancosol was launched. I also served as President and CEO of ACCION and also started an investment fund in Argentina called Pegasus capital.

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