by Michael Norton, co-founder of Buzzbnk, the crowdfunding platform for social ventures: www.buzzbnk.org
Can grass-roots services be developed for the poor using an enterprise model? If so, this would generate an income for the service provider, who would not have to rely on grants and donations for the sustainability of the venture. Michael Norton, co-founder of Buzzbnk, a crowdfunding platform for emerging social ventures, explores this at Buzzbnk.
If a service is appropriate, good enough and affordable, the poor can pay. For example:
• Pumla is a 52-year old qualified nurse who plans to run an after-hours clinic in the township, where she will charge 10 Rands ($1.5) per patient seen. Each week in the evenings and at weekends when people are free to access this service, she will see 40 patients in 5 two-hour sessions. The alternative is to line up at a hospital or government clinic perhaps arriving at 4.30am to get there early, and perhaps not being seen by the end of the day. This could mean 150 Rands in lost earnings with a good chance of not even being seen. The10 Rands is a small price to pay for being seen (and for friendly advice on health problems). And for Pumla it could provide a good income.
• James Tooley in a study for the World Bank on private education for the very poor published as “The Beautiful Tree”, found a sector which was both substantial and thriving: www.jamestooley.net. Parents were prepared to pay for their children’s (largely) primary education where the state was not providing, or where the quality was too poor to be acceptable or where the teacher was not turning up. They wanted to see their children educated enough to pay for it. The providers emerged to meet this demand, but had to design their educational service within very tight financial constraints and had to ensure that it met parents’ needs and aspirations sufficiently to motivate them to pay over the cash. Parents were being let down by the state which was not providing for them as per its obligations. But this alternative did ensure that children were in school.
• Marina runs an after-school club on Wednesday afternoons in a township for 40 kids using volunteers and a “light touch” curriculum which concentrates on well-being and fun. It works. The kids are kept active doing something positive, which could change their whole outlook on life and their futures.
All these are grass roots services delivered affordably, and which could be replicated using a social franchising model (applying Kentucky Fried Chicken principles to delivering a social service). If there are sufficient skilled people around (and providing them will be part of the challenge for making this approach a success), and if (at least for the first two examples) there is sufficient income-generation capacity in the enterprise, then it will be relatively easy to scale up the venture.
Scaling up could bring economies of scale, could create opportunities for developing and sharing intellectual property to improve the quality of the service, and could provide the systems which would allow for easy operation. Some of these micro-social enterprises could be businesses; some could be undertaken as sole traders.
Pumla is currently getting the qualifications she needs to set up her social business distributing medications. She might want to go from one clinic to two, to five, to ten and then on and on, using a franchise model. Or she might just want to stop with one or two and hope that others will copy her.
A similar service is being developed by The Health Store Foundation in Kenya through their Child and Family Wellness Shops. Living Goods is distributing health products in poor communities using a model similar to that used for Avon Cosmetics. They started in Uganda and want to spread the idea, especially to Tanzania, Mozambique, Rwanda, Kenya, Ghana and India.
Jay Kimmelman is developing the idea of franchising private education for the poor in Africa through his Bridge International Academies, set up with a loan from the Omidyar Foundation. Starting with just two schools a couple of years ago, he plans to be education 1 million children within 5 years. He will be able to provide educational resources and access to ideas that a single headteacher working alone could not hope for. His business model is to use the economies of scale to drive down the fees charged to pupils, seeking to expand the market at the “bottom of the pyramid”.
Marina’s venture is entirely voluntary, but she could still franchise the service, calling it Marina’s Place, developing the “curriculum” of activities and providing training to those who want to join her network.
These few examples illustrate the wide range of opportunities that must exist for creating and delivering services that address the problems of poverty in the world in a way that can be scaled up.