You wouldn’t know we’re in the dog days of summer from the past month in social business. NextBillion’s editors sample some of the many developments that have captured their attention in recent weeks – from emerging technologies and new partnerships to intensifying debates.
1. Irresponsible Exit?
Back in November 2015, the pioneering, non-profit microfinance network Opportunity International agreed to sell six banks serving sub-Saharan Africa to the MyBucks Group, a for-profit, Luxembourg-based fintech startup.
The sale should have been bigger news, write Daniel Rozas and Gabriela Erice García at the European Microfinance Platform. “At a time when technology and mobile money are the talk of the sector, how does a story like this pass under the radar?” What’s more, they say, “The deal echoes another major topic for microfinance and impact investors: responsible exits, or how socially oriented investors can sell their equity stakes without undermining the social mission of their investees.”
According to former MFTransparency CEO Chuck Waterfield, this exit fell short of those standards. In a highly critical post that raises concerns about both MyBucks’ leadership and its lending model, he argues that “the savings and potentially the economic welfare of over a million trusting poor clients in Africa appear to be at risk.”
In a response, Opportunity CEO Vicki Escarra defends the partnership, which she says “will allow MyBucks to offer lower interest rates to clients by combining the best of both organizations.” (Check out Waterfield’s rebuttal, and Escarra’s earlier interview with NextBillion.)
2. Simple Tool, Complex Problem
A lot of people who are treated for malaria don’t have malaria. That’s because it’s difficult in a rural setting to determine if someone has the disease. There’s never been a simple, inexpensive, noninvasive test for it. And it’s so prevalent in much of the world that when people get a fever, it is often just assumed that malaria is the problem. One of the many issues related to misdiagnosis is that antimalarial drugs have been overused to the point of antimicrobial resistance.
This dilemma is what led Fyodor Biotechnologies to develop its Urine Malaria Test. This $2 test is so simple that almost any mother in any remote village can administer it; they only have to put a test strip in a cup containing urine and wait 25 minutes for a positive or negative result. Fyodor is hoping for another result: saved lives. You can learn more here.
3. Waste Goes Better With Coke
Waste Ventures India (WVI), a trash-collecting and recycling social enterprise that employs garbage pickers in several Indian cities, will partner with a fairly large producer of plastic waste: Coca-Cola. The company announced in its recent e-newsletter that it will serve as Coke’s primary collection partner to gather post-consumer plastic bottles and channel them to certified recyclers. That plastic will be processed and made available to Nike and Adidas to create “sustainable athletic apparel,” WVI says. Terms were not disclosed, but Coca-Cola will also contribute financial and in-kind support, the company notes. Find out more about Waste Ventures in previous NextBillion posts here and here.
4. No Roads? No Problem.
Quick! Which country just became the first with a drone delivery network. If you guessed Rwanda, you pass our pop quiz on global health.
Through an interesting set of circumstances, a Silicon Valley startup called Zipline has partnered with the Rwandan government to deliver last-mile blood supplies to the western half of the country, starting this month (July). Next year, Zipline officials expect that almost all of Rwanda’s 11 million citizens will be within instant reach of its fleet of drones. After that, the company “plans to expand operations to countries across Africa and the world, moving beyond blood delivery to include lifesaving vaccines, treatments for HIV/AIDS, malaria and tuberculosis, and many other essential and lifesaving medicines.” You can read all about it here.
5. Microfinance Meets Blockchain
In another global first, Japanese blockchain startup Tech Bureau and software firm Infoteria recently announced the successful transfer of loan and deposit account data from BC Finance, a microfinance institution in Myanmar, to Tech Bureau’s private blockchain. According to the companies, this trial represents the first time blockchain technology has been used for microfinance purposes.
The transfer reportedly included the entire transaction history of one of BC Finance’s 19 branches. According to Tech Bureau CEO Takao Asayama, this illustrates the potential that blockchain technology has for the sector. Rather than laboriously recording account data manually or investing in a costly enterprise financial system, he says, blockchain allows MFIs to “build a ledger system that can handle all transactions with digital signatures.” This can let them “easily compress their budgets down to, say, 1/10 or 1/100” and potentially eliminate the user fees required to manage the very small transactions of microfinance.
Asayama speculates that looser regulations will push developing countries like Myanmar to the forefront of efforts to incorporate blockchain into financial services. The CEO of BC Finance seems to agree: After this successful test, he told CoinTelegraph that he envisions the technology “supporting a new type of core banking system,” and that his bank will announce a new blockchain-based service in the coming weeks.
6. Human-Centered Design for Employment
Human centered design (HCD) is a bit of a buzzword these days. But it has a lot in common with good old fashioned advertising. Both disciplines are trying to change human behavior. But instead of an ad telling someone what to aspire to (i.e.: what to buy), HCD is fueled by a different type of motivation: nudging people’s choices – and thereby improving their lives.
Cal Bruns, the founder of Matchboxology has been in both camps – as an advertising executive with Leo Burnett and, for the last 10 years, the co-founder and manager of the HCD consultancy Matchboxology in South Africa. Matchboxology serves as an informational middleman of sorts, connecting large companies with the social interests and needs of South Africans. That has led to some interesting projects and partners, including a campaign involving Levi’s and HIV/AIDS awareness.
Matchboxology’s focus has shifted toward entrepreneurship as South Africa, along with much of the continent, faces a youth unemployment crisis. “Today’s generation is absolutely petrified, not by HIV, but by getting a job,” Bruns told NextBillion in our latest podcast. Find out more and listen to the podcast here.
7. Textbook Partnerships
There are plenty of theoretical discussions about the value of partnerships, but real-word success stories are especially valuable – like two that came to light recently.
Miraclefeet is a five-year-old organization that’s out to prove clubfoot can be solved on a global scale. Based on their success rate and growth, they might just be right. They’ve leveraged partnerships with the Stanford d.school, Clarks Shoes, King & Spalding and Export Import Services to design, make and ship braces to those who need them around the world. Their story is told here.
Smile Train, the world’s largest cleft charity, and Lifebox, the leading NGO dedicated to safe surgery, are bringing safe surgical care to under-resourced facilities. They play off each other’s access and expertise to supply pulse oximeters, which monitor blood oxygen levels during surgery, to hospitals that don’t have them. Here’s how they do it.
8. Poor Man’s RCT?
Randomized control trials (RCTs) are widely seen as the gold standard for evaluating an intervention’s effectiveness. But as Aaron Dibner-Dunlap at Innovations for Poverty Action and Yumna Rathore at the Center for Economic Research in Pakistan point out, many organizations are rightly concerned about the expense and time commitment they involve. For these organizations, they advocate an alternative: rapid-fire tests (RFTs), a more nimble variety of RCT specifically aimed at improving product design. RFTs are already common among tech companies looking to rapidly iterate their products, and in this post, Dibner-Dunlap and Rathore describe their pros and cons as a tool to improve financial services for the poor.
9. Cloud for Impact
Base of the pyramid pioneer (and one of the forefathers of NextBillion) Al Hammond recently made a startling acknowledgement:
“We hoped big companies would develop these markets. Then we hoped social entrepreneurs would scale successful solutions, or that governments would create the conditions that support bottom-up growth. But it’s fair to say that, despite many individual successes, none of the above has so far proven to be transformative for the base of the pyramid.”
Hammond is one of the principle organizers of September’s BoP World Convention & Expo, which was launched two years ago to build cross-sector partnerships and hybrid models as potential catalysts. For this year’s event in Singapore, however, Hammond and other conference backers believe the answer for inclusive businesses could be hiding in the cloud. With smartphones dropping in price and bandwidth ever widening, the conference will focus on how cloud-based platforms could enable the next generation of BoP enterprises to deliver low-cost products and services to low-income people. Find out more here.
ImpactAlpha is collaborating with NextBillion to highlight coverage of the top stories, leaders and trends in social business. In periodic ImpactAlpha posts, the NextBillion team will share the key stories, innovations and market activities that have caught their eye in recent weeks.