Featured Stories

GP invests in Greenlight Planet to bring more solar lights to rural poor in Latin America


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

by Danny Stokley, green technology officer, Global Partnerships

In regions of the world where grid electricity is inaccessible, Greenlight Planet’s line of Sun King branded solar lights is becoming a household name. In simple terms, Greenlight Planet (GLP) makes really cool products designed for people living in poverty. They represent what many impact investors, like Global Partnerships, look for - overlap between reaching underserved families with products that improve their lives, while growing sales and maintaining margins that make them an attractive investment opportunity. Global Partnerships (GP) has been in conversations with GLP for over a year, and in October disbursed a working capital loan to support their continued growth as a company.

Why is GP investing in Greenlight Planet?

Global Partnerships has been working for some time to address the working capital crunch at the solar light distributor level in Latin America. We believe that partnering with GLP will help get more high-quality solar lights into local distribution channels, increasing the supply of products that make a tremendous impact at the household level. We learned a lot about the company through desk research and Skype calls, but visiting each partner, interviewing staff at all levels, and meeting their clients is an essential part of our due diligence process.

Visiting Greenlight Planet in India

So, after several months of pouring over financial statements, growth projections, and management bios, GP’s Chief Investment and Operating Officer (CIOO) Mark Coffey and I packed our bags and traveled to GLP’s headquarters in Mumbai, India. We spent two days on site working with GLP’s team, and then flew to Lucknow, the bustling capital of Uttar Pradesh, a state in northern India.

Our ultimate destination was an off-grid community three hours outside the city, where we spent the afternoon interviewing families that had purchased Sun King products. However, we did get a chance to visit the GLP branch office in Lucknow. Still jetlagged, we were tired, hungry, and sweating profusely by the time we arrived. However, our exhaustion faded away when we were met at the door by the entire GLP branch team. They had stopped what they were doing to greet us, presenting each of us with a bouquet of flowers.  That small extra gesture made us feel like we were already part of the family. 

While this warm greeting is just one example, I believe much of GLP’s success can be attributed to their attention to little details. This ethos seems to be woven into the fabric of Greenlight Planet, and nowhere is this more evident than in their best-selling solar light, the Sun King Pro (SKP).  At first glance the SKP is beautifully designed and elegant in its simplicity. Picking it up reveals that all external components are smooth, compact, and durable, made to withstand potentially rough treatment in rural environments. Beyond the attractive look and feel, the SKP offers a couple of key innovations – little details that make a big difference for families living off-grid. 

Innovations in solar light design

By way of example, the SKP includes a solar charging gauge, a simple display showing the strength of charge while the panel is in the sun. This acts as a built-in guide to assist with panel placement decisions during the day, helping users determine which direction to face the panel and learn the effects of shading.  Allowing each customer get the most out of their light not only increases user satisfaction, it ultimately increases impact through additional hours of light.

Attention to detail and focus on improving the user experience has proven to be very disruptive in technology markets in the developed world, and GLP’s Sun King solar lights are beginning to have the same impact in off-grid communities. Families living in extreme poverty are some of the most discerning customers on the planet, and companies that want to sell them new technologies must design intuitive, aspirational products.

Having a great solar light product is not enough to succeed

Most people working at the last mile will tell you that having a great product is just the beginning, and during our visit we also learned about a number of GLP’s innovations in building out distribution channels. In order to support GLP’s expansion in Latin America, Global Partnerships will provide working capital that allows them to offer more flexible credit terms to select partners in the region.  These small social enterprises are acutely affected by cash flow challenges inherent in importing products manufactured across the world, yet are a key part of the value chain reaching off-grid consumers. We hope that a small grace period on payment terms will allow these companies to import greater quantities, avoid stock outs, and begin scaling their impact. 

If you enjoyed this blog post, you might also like:

Blog Tags: last mile      solar lights   solar tech   

Mastram is a last-mile reseller of GLP's Sun King Pro solar lights
Mastram (left) was one of the first residents in his village to buy a Sun King Pro. He was then recruited to become a last-mile reseller for GLP, referred to as a Saathi (Friend). He now earns as much from selling lights as he does from farming, and is known around his community as the “Solar Light Wallah (Guy).” Photo © Global Partnerships

Speed dating with purpose in Ecuador: 3 themes from the annual FOROMIC conference


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

by Nathalia Rodriguez Vega, financial and economic analysis officer, Global Partnerships

Earlier this month, I was one of seven members from the GP team that flew to Ecuador to attend FOROMIC, an annual conference held by the Inter-American Development Bank. It’s the largest event about the financial inclusion industry in Latin America and the best occasion to meet – in just 3 days – most of our partners as well as other organizations that help us do our work in the region.

For me in particular, this event was a unique opportunity to step away from the spreadsheets and lengthy reports, fly all the way from cloudy Seattle down to sunny Guayaquil, and get a first-hand impression about the people we work with, what excites them about their latest achievements, what worries them about the future, and most importantly, hear how we can help them.

How to speed date at FOROMIC

I met with representatives from 20 of our current 46 partners, in meetings that lasted about one hour on average. If you want to know how this works, picture an area in the middle of a convention center called the “Meeting Point”, which is filled with about 50 tables that are conveniently numbered and that can seat about four people at a time. Before the annual conference begins, the FOROMIC website allows you to see who is attending and gives you the option to schedule meetings with as many people as your agenda and body can take. Therefore, once the conference starts, you just need to go to the meeting point and someone from the team running the event will take you to your table. Every hour either this same person will come to tell you your time is up, and that someone else is meeting at that table, or you can just walk to the next table where you have your next meeting. It’s basically speed dating with a purpose.

These meetings could go in many different ways depending on the type of partner and how many years we have worked together. However, most of the time we would ask them to highlight the most important things that happened over the past year, the challenges they anticipate for the next couple of months, and their funding needs.

To sum up, here are three broad insights from my conversations with our partners:

 

1. The marketplace is very crowded:

Likely reflecting ample global liquidity, I was surprised to see so many lenders offering funding at very low interest rates. Although this “buyer’s market” probably makes many of our partners happy, it’s worth noting that current market conditions are unlikely to be like this permanently.

Furthermore, this abundant liquidity worries me, as it might create the wrong incentives and cause our partners to deviate from their mission. Therefore, as an impact investor we need to do an even stronger screen of the people we work with in the region. We need to follow up closely on any changes in their strategy, including the type of products they offer and how they care about raising the quality of life of people living in poverty.

2. Paradoxically, over-indebtedness co-exists with low financial inclusion rates:

Over-indebtedness is one of the key concerns addressed by many of our partners. This reminded me of my last trip to Peru, when I visited the small town of La Merced that had streets lined with all types of financial institutions. Even though Peru ranks as the leading country enabling financial inclusion (prudent regulation, agents and branches, and dispute resolution), financial inclusion is still relatively low (only 20 percent of the adult population held an account at a formal financial institution in 2011, according to the World Bank’s Global Financial Inclusion Database (Global Findex).

This signals that our work is not done. Vulnerable populations – women, indigenous groups, etc. – remain without access to financial services. However, not all organizations have the cost structure to fulfill their needs. We need to work with them to find ways they can reach vulnerable populations and at the same time have the right policies, risk mitigants, and controls to prevent over indebtedness among their clients.

3. Changing legal climate:

Most of our partners are changing their legal structure; some are looking to become regulated entities while others are planning on converting into cooperatives. In Bolivia, the 2013 Law of Financial Services, still undergoing implementation, requires that all non-governmental organizations or Instituciones Financieras de Desarrollo (IFDs) obtain their license over the next two years. With this license, our partners will have access to additional sources of funding, including deposits from the public, which is likely to reduce the need for international investors.

Given this context, we discussed with our partners what the future of our relationship would be. Overall they highlight that we have worked with them for many years, even in periods when funding was scarcer and they were just starting to run their operations. They value our role in helping them be the type of organization they are now and we are exploring other ways to keep our partnership in the future. We’re going to need creative ways to achieve this, for sure.

After three days of “speed dating” my brain felt somehow bigger with all these new learnings. I felt re-energized from all the conversations I had and impressed with the talent I met. This trip gave me a new sense of responsibility; we have a strong commitment to our partners and they see us as people that can provide them guidance and advice beyond funding. I can’t wait to go back to FOROMIC next year.

If you enjoyed this blog post, you might also like:

Blog Tags: Bolivia   due diligence   Ecuador   Foromic   Latin America   microcredit   microfinance   Peru   

The "Meeting Point" at FOROMIC 2014
The "Meeting Point" at the FOROMIC 2014 conference in Guayaquil, Ecuador. Photo © Global Partnerships.

IMPACT Newsletter: GP’s past, present & future, Luncheon highlights, and Investing in coffee co-ops


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

GP IMPACT: Fall 2014

Here in Seattle, the days are getting shorter, the air chillier, and stringed lights are beginning to appear throughout the city. The holiday season has arrived. Next week, many of you will spend Thanksgiving with loved ones, sharing a meal and reflecting on all that you're thankful for.

We have also been doing quite a bit of reflection; 2014 is Global Partnerships’ 20th anniversary, and we’re thankful for your support of our work, and belief in our mission of expanding opportunity for people living in poverty.

At our annual luncheon last month, we looked back on our 20-year journey, and provided a glimpse into our future. In this issue of IMPACT, we round up highlights from the luncheon, and take a deeper look at our work with coffee cooperatives. Those who were unable to attend our luncheon may watch it online here.

GP'S PAST, PRESENT & FUTURE 
GP’s President & CEO Rick Beckett reflects on GP’s journey – from our start as a family foundation making grants in the pioneering days of microfinance to our current work as a nonprofit impact investor. Rick also recently shared his insights in interviews with Forbes, Humanosphere and GlobalWA
Read more >

LUNCHEON HIGHLIGHTS
Last month, you helped us raise an astounding $643,000 at our annual luncheon! Our special guest speakers Elizabeth Littlefield, president & CEO of the Overseas Private Investment Corporation, and Frank Fuentes, general manager of our partner Crediflorida in Peru, also shared powerful speeches. Read more >

INVESTING IN COFFEE CO-OPS
Karina Vadillo, GP’s legal services and fund operations officer, talks about her visit with Colombian co-ops earlier this year, and sheds light on the challenges that farmers face, and the ways that GP’s investments help. Read more >

Subscribe to our newsletter >>

Blog Tags: 20th anniversary   co-ops   coffee   Colombia   IMPACT Newsletter   Latin America   luncheon   OPIC   Rick Beckett   

Guests at GP's 12th annual luncheon in October 2014.
Guests at GP's 12th annual luncheon on October 22, 2014. Photo © Global Partnerships.

Expanding opportunity for farmers in Paraguay


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

by Mark Coffey, chief investment and operating officer, Global Partnerships

Last week I traveled to Paraguay to meet with social enterprises, agricultural producers and a government official as part of our research into new investment opportunities. Nearly a quarter of Paraguay’s population lives below the poverty line, but the country’s underdeveloped economy is currently experiencing rapid economic growth. With this kind of growth comes the chance to catalyze and expand opportunity for people living in poverty. As I flew over much of the small, land-locked country in a tiny Beechcraft plane, I noticed the flatness of the land, its many rivers, and the countless tracts of well-watered but unused farmland. It is evident that Paraguay’s agricultural sector has tremendous potential for growth.

Social enterprises

During my five days in Paraguay I was able to visit four social enterprises:

BioExport and ARASY, two agricultural organizations that provide technical assistance and access to (and processing for) export markets. They serve smallholder farmers growing sesame and chia as well as more traditional products like cotton and rice;

Fundacion Paraguaya, which provides credit and integrated services to people living at the base of the economic pyramid; and

Elevate Business, which provides business training to young, emerging small and micro entrepreneurs (SME’s) who have high potential to absorb and implement concepts for markedly improving their business. Some of their clients include Fundacion Paraguaya’s clients.

In the past decade, many farmers with land holdings under 8 hectares (approximately 20 acres) have realized the benefit of enriching their soil and their incomes by converting from one traditional crop (such as rice, beans, corn, and cotton) to higher priced products such as sesame and chia. Thanks to the efforts of social enterprises such as BioExport and ARASY, hereafter referred to as “outgrowers,” there is a developing export market for these higher-priced products. To scale the opportunity to more farmers, we need to build up an ecosystem where access to financing, technical assistance and markets is readily available.

Agricultural producers

I also met with a number of farmers as well as cooperative and association leaders. In a meeting in Liberacion, an area with high poverty levels, I learned that the farmers had formed an association to better allow them to:

• form ties with buyers and providers of technical assistance (such as BioExport and ARASY);

• and to purchase and share equipment.

In another meeting at Cooperativa La Nortena, in the northern state of San Pedro, I learned about the coordination efforts between the various “tecnicos” (agronomists) who provide education and technical assistance, some of whom are staff of the outgrowers.

In another meeting in the southern state of Itapua, I attended a technical assistance meeting of about 50 farmers. The topics included the rotation of crops, the weather forecast and the planting of sesame seeds, proper soil preparation, etc. I found the farmers to be very attentive to the conversations and some of them were active in asking the tecnicos questions.

Some of the farmers were new to the sesame and chia crops, while others had experienced the benefits of the development of these markets over the past few years. My hosts told me that Paraguay currently has only about one percent of the world sesame market, but a much larger share of the Japanese import market and a growing share of the US and European markets. The Japanese are particularly interested in the expansion of supply from Paraguay, since the Paraguayan varieties are considered sweeter and of higher quality, and since Japan does not buy product from India, the world’s largest sesame producer.

The farmers told me about the importance of the technical assistance provided directly at the farm level as well as at community, association, and cooperative-level education sessions. With regard to financing, some of them wondered why it is so difficult to get long term financing rather than the type of seasonal financing they receive either in the form of seeds from outgrowers or in the form of loans from cooperatives.

A meeting with the vice minister of agriculture

After these visits I had the opportunity to meet in Asuncion with Vice Minister of Agriculture Mario Ruben Leon. After a discussion of our interest in Paraguay and some of my observations about the potential for improved output and earnings by small-holder farmers, he emphasized two keys to the development of smallholder farmers in Paraguay:

(1) Greater mechanization: This doesn’t have to mean large equipment mechanization, but can be as simple as some US-manufactured products such as plastic tables or huge plastic bags that keep farm products from being damaged in the fields, or semi-mechanized planters. He also noted that because of the lack of mechanization, young people see their fathers work all day long in the hot sun, with very little reward. As a result they don’t want to work the farm, but at the same time, they are unprepared to go to the city.

(2) Crop rotation: Mr. Leon specifically focused on the value for the farmer of planting sesame and chia, and then rotating into more “old school” products for the rest of the year-long growing season. We agreed that there is plenty of cultivable land, and favorable conditions (long growing season, warm weather, water). But until greater training and mechanization occur, Paraguay will not retain young people in farming and not grow incomes and outputs like it should. Some BioExport agronomists would go further and say that mechanization is optimally effective only when accompanied by technical assistance.

Conclusion

I came away from my meetings in the agricultural sector with an appreciation for all the actors and tools that are required to create markets and lift a sector: cultivable land, reasonable mechanization, technical assistance, access to both seasonal and longer term capital, promotion of products in export markets, modern and low cost processing technology, government support of the sector, and investors that understand how to locate and finance the key value chain players. At Global Partnerships, our role is limited but essential to making the value chain work; without it, farmers will produce less sesame and chia in Paraguay and households will not realize the earnings potential and the extent to which their daily lives could improve.

Blog Tags: agriculture   cooperatives   farmers   Latin America   Paraguay   producers   

Mark Coffey (center) meets with a group of 75 Paraguayan farmers.
Mark Coffey (center) meets with a group of 75 Paraguayan farmers. These farmers have formed an association that sells to BioExport. They have also banded together to purchase the tractor pictured. They are hoping that their livelihoods will improve, and that they can one day become a cooperative. Photo © Global Partnerships.

Creating impact for 30 million lives by 2024


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

At Global Partnerships’ annual luncheon last month, our President and CEO Rick Beckett shared our goal of increasing our impact by touching 30 million lives over the next decade. In this blog post, Tara Murphy Forde, our director of research and impact, introduces GP’s Program & Impact Team and the role it will play in helping GP reach that goal.

by Tara Murphy Forde, director of research & impact, Global Partnerships

The Program & Impact Team, led by Peter Bladin, aims to strengthen our capacity to identify promising new markets and initiatives to deploy high impact capital into sustainable solutions that deliver meaningful opportunities to people living in poverty. The team’s role within the organization is four-fold:

  • Research – We are developing a rigorous, consistent, and iterative research practice that will inform the selection, definition and ongoing evaluation of GP’s initiatives;
  • Market and Early Business Development – We are building relationships with industry thought leaders and practitioners to identify promising new solutions and explore opportunities for collaboration;
  • Program Management – We are overseeing targeted learning work with a select set of partners;
  • Impact Measurement – We are developing a comprehensive methodology for how we define measure, learn from, and improve on our impact.

Through these activities we look to synthesize the best available information from existing literature, informed opinion, and results from our own portfolio to hone our investment strategy. For example research into our current microentrepreneurship initiative has helped us to:

1. Clarify the target client as women at the base of the pyramid;

2. Gain confidence that when delivered well, financial services plus education across a broad range of livelihoods topics leads to consumption smoothing, increased resilience, and opportunity creation;

3. Identify that sessions taught by cross-trained loan officers during pre-existing village bank meeting has the potential to achieve both sustainability and scale.

With these insights we are busy trying to increase our engagement with best-in-class organizations while simultaneously seeking new types of social enterprises that deliver promising results. In short through a more structured approach to understanding what innovations work, why, for whom and under what circumstances - the Program and Impact team is helping Global Partnerships focus and deploy capital on the most promising solutions that have the potential to reach scale and be sustainable.

Want to learn more? Check out:

Blog Tags: business development   impact evaluation   impact measurement   program & impact   program management   research   

Tara attends a CRECER village bank meeting.
Tara Murphy Forde (center) attends a village bank meeting with clients of our partner CRECER, in Bolivia. Photo © Global Partnerships.

Ebola and global crises threaten food security – why GP’s rural livelihoods investments are crucial


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

Multiple global crises, such as the Ebola epidemic in western Africa, conflicts in Ukraine and the Middle East, and droughts in Central America have led to an increasing demand for food aid. But the aid is unsustainable, according to the United Nations’ (UN’s) Food and Agriculture Organization (FAO) and World Food Program (WFP).

Without food aid, each region has large populations that remain vulnerable to starvation and malnutrition. However, the number of crises around the world is far outpacing the level of funding for humanitarian operations,” said Antonio Guterres, the U.N. High Commissioner for Refugees. For example, Ebola quarantines in western African nations such as Guinea, Liberia and Sierra Leone have led to “panic buying, food shortages and severe price hikes.” With an estimated 1.3 million people in the region in need of food assistance, “the WFP and FAO [are] planning to scale up life-saving operations by delivering 65,000 tons of food to the areas over the next three months.”  At the same time, more than 300,000 Ukrainian refugees and 1.5 million Iraqi refugees remain without adequate access to food and water, and the WFP and FAO also plan on addressing those needs.

Meanwhile, on the other side of the world in Central America, the worst drought to hit the region in decades has devastated the crops and livelihoods of farmers in Guatemala, Honduras, El Salvador and Nicaragua. USAID reports that “extremely poor households […] will experience rapid deterioration of their food security in early 2015 […] and atypically high levels of humanitarian assistance […] will likely be required in order to avoid a food crisis.” For example, over 230,000 families in Guatemala have lost crops and livestock, which “could leave hundreds of thousands without food.” This caused the Guatemalan government to declare a state of emergency last month, and it will rely on support from WFP to distribute food to hundreds of thousands of families in the coming weeks.

These recent events remind us that Global Partnerships’ (GP’s) work doesn’t take place in a vacuum. Our investments in partner organizations that support rural livelihoods are now more important than ever. For instance, our investment in FUNDEA, a microfinance institution in Guatemala, helps ensure that farmers receive the financing and technical assistance they need to earn a living and provide for their families. Through FUNDEA, we help farmers obtain some stability and resiliency in their livelihoods amidst a world full of increasing instability. The same holds true for our investments in Credicampo in El Salvador, FDL in Nicaragua, RAOS in Honduras, and our other rural livelihoods partners. 

To learn more about our partners, please see our partner grid, which is updated every quarter.

If you enjoyed this post, you might also like:

 

Blog Tags: Central America   ebola   farmers   food security   Guatemala   Latin America   United Nations   

A FUNDEA client tends his field.
A FUNDEA client tends his field. © FUNDEA.

Innovations to serve people living in poverty at the 17th Microcredit Summit


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

At last week’s 17th Microcredit Summit in Mérida, Mexico, stakeholders from the microfinance industry gathered to discuss how innovations in microfinance can help rid the world of extreme poverty. Many of Global Partnerships’ (GP’s) partners are microfinance institutions (MFI’s) that provide access to finance and education, so our Vice President of Portfolio Management, Ricardo Visbal, attended to meet with existing and potential partners. From the summit, we were also excited to learn about innovations such as: 

  • Mobile technologies that replace cash with electronic transfers, which makes access to finance more affordable, as well as more accessible for people living in remote areas.
  • The role that government can play to catalyze access to finance for the poor. For instance, last month 15 million bank accounts were opened on the day that the Prime Minister of India, Narendra Modi, announced a new initiative to give the poor access to bank accounts.

Innovations such as these are forward-looking and can help change the lives of those in poverty. They are focused on scaling the amount of people that can be reached. However, just as important are the kinds of innovations that help us ensure that MFI’s are serving people living in poverty with the right kinds of services and products, and that these services/products are making a difference.

One such innovation that addresses this need is the slew of new accreditations that have emerged in recent years. One such accreditation is called Truelift, a framework that certifies an MFI’s commitment to its clients. For example, GP’s partner CRECER, a Bolivian MFI, is “the first Latin American organization to achieve the leader milestone for its adherence to the Truelift Pro-Poor principles.” This means that CRECER has demonstrated the highest level of compliance in terms of providing services that meet the needs of those living in poverty and tracking their progress out of poverty.

CRECER targets vulnerable groups; 82 percent of its clients are female and 56 percent live in rural areas. And “out of the clients that remained with CRECER between 2011-2013, 49 percent reduced their poverty probability level.” We are proud to be partners with CRECER, and will be publishing a blog post in the future about why it represents a partner that is “best in class.”

Attending conferences like the Microcredit Summit helps us stay on top of developing trends in the microfinance space so that we can better serve clients through our partners. Please subscribe to our blog so that you don’t miss out on our latest insights.   

Blog Tags: Bolivia   CRECER   impact   Latin America   Mexico   microcredit   Microcredit Summit   microfinance   Truelift   

CRECER village bank meeting
A group of CRECER clients gathers for a village bank meeting. © Global Partnerships

To reach the last mile, learn from the locals


Subscribe to GP's blogIf you like what you’re reading, please subscribe to our blog via email. Click here or enter your email in the subscription box at the top right corner of www.globalpartnerships.org.

Morgan Babbs was Global Partnerships’ (GP’s) Green Technology field associate intern throughout the summer of 2013 (read about her experience here). Since then, she won a D-Prize and a Davis 100 Projects for Peace grant to start her own solar power social enterprise in Nicaragua, SolarRoute, which delivers solar lights to rural communities by tapping into existing last-mile distribution channels. Morgan shares some of the lessons she’s learned since founding her start up. Morgan is a rising senior at Tufts University, where she’s majoring in economics and international relations. She can be reached at morganlbabbs@gmail.com.

by Morgan Babbs, founder and CEO of SolarRoute

In the field of development economics, the “last mile distribution challenge,” how to service the most geographically isolated corners of the world, is often portrayed as an amorphous concept that stumps social entrepreneurs around the world. In the search for a solution, many come up with innovative strategies and new delivery models.

This kind of innovation is important in order to advance global development, but it’s even more important to focus on what you can learn from existing day-to-day supply chain movements and business practices in order to best reach the last mile. Before we jump to the question of, “How do we solve the last mile distribution challenge?”, it is important to ask, “Who is already going the last mile?”

If you transport solar lights atop a chicken bus, will they arrive at their destination?

Doing business in low-income countries is certainly challenging and frustrating at times. However, it would be imprudent to think that things just don’t function in these markets — in fact, it’s quite the opposite. There are intricate, albeit informal, last mile networks that move cash and goods all around the country.

How is it that cash and tons of passion fruit, mattresses, pots and pans, and other items are routinely moved around the country on top of a bus or in the back of a pick-up truck with no record, receipt, or insurance? The answer: trust.

Try to imagine all the players in this supply chain that have to uphold their end of the bargain in order for this to run smoothly. You’re counting on the fact that your goods won’t be stolen, that your contact on the other end is there on time, that the vehicle doesn’t crash or get robbed. The possibilities for disaster are endless. Yet, I’d be lying if I said that SolarRoute hasn’t sent a box or two of Greenlight Planet SunKing solar lights on top of a chicken bus for a staff member to pick up in his hometown two hours away from our base. Trust plays an important role in ensuring that informal last mile distribution networks function in Nicaragua, where the petty crime rate is high. It is an impressive system that functions against all odds.

Thus, selling solar lights in Nicaragua forces you to see things through this new lens. You naturally start to think more about supply chain and distribution of universally popular products: where do things move, where do people go, what is best advertised? Simply standing in a bustling market or at a busy bus stop for several hours in the municipal capital of a rural zone can teach you more than you could possibly imagine about local last mile distribution tactics. And that’s what inspires SolarRoute’s strategy.

What is the last mile and how can we reach them?

SolarRoute provides dual solar lamp-cell phone charging technologies to the last mile in Nicaragua. The “last mile” is a development term used to describe geographically and economically isolated populations with little access to relevant information, services, and resources to lift themselves out of poverty. It’s a definition largely applicable to the 30 million people in Latin America and the 1.3 billion people in the world who do not have affordable access to energy. This group makes significant use of kerosene lamps for energy, which are harmful for their health, the environment, and provide limited visibility during evening hours. Lack of lighting and proper technologies inhibits productivity — resulting in fewer hours spent studying or working, which translates to a smaller chance of progressing out of poverty.

There is an entrenched system of last mile interactions that SolarRoute has tried to replicate in order to maximize customer reception. For example, the most far-reaching and recognizable companies in Nicaragua are the two competing cell phone carriers, Movistar and Claro, Coca-Cola, and the largest chicken distributor, Tip Top. What they do best? They ensure that their brand is everywhere. In every corner of Nicaragua, you can add Movistar and Claro minutes to your phone, and you can buy a Coke to wash down your Tip Top chicken. Lucky for them, these companies gross huge profits so they can easily afford to take big off-road vehicles around the country every week to distribute their product. So if your goal is last mile distribution, the most logical, scalable, and cost-effective thing to do would be to tack onto the guys already going the last mile.

SolarRoute does last mile distribution like the local experts

SolarRoute works with agro stores, microfinance banks and school teachers to reach each institution’s last mile network. Our most recent development in last-mile strategy lies with a network of dirt-bike mounted distributors contracted by Movistar to deliver Movistar cell phone credit throughout the country. They span most of Central and South America and we recently scaled nationwide with them—allowing us to reach their 30,000 resellers (and more along the way). So, in addition to selling cell credit and cell phones, they also sell solar products. At every kiosk in every corner of a developing country you can find a “Movistar: recharge here” sign indicating where you can add more minutes to your cell phone. SolarRoute hopes to make small solar solutions as accessible and commonplace as cell phone minutes.

It’s doing the little things to imitate already successful brands that will hopefully add to SolarRoute’s success. For example, every SolarRoute retailer gets a sign indicating that SolarRoute products are sold there, a move inspired by the Movistar, Claro and Tip Top retail signs seen outside shops. Movistar and Claro paint their logo on concrete walls in every town: so do we. Movistar and Claro host small marketing events in the local markets and bus stops once per week: so do we. The idea is to engage in marketing, sales and business strategies that are already employed by the local experts in Nicaragua.

Of course there’s a need for improvement in these markets. Increased reliability and accountability, and a reduction in bureaucracy can help make huge strides towards increased availability of life-changing resources, services and technologies. But a huge discussion exists around creative last mile solutions. It’s a challenge, but it’s important to remember that there are already companies doing this. The question to ask is, “What can we learn from them in order to better distribute life-changing things such as tablets, cell phones or vaccinations?” In fact, it would be taking undue credit by saying SolarRoute employs “innovative” last mile distribution tactics. SolarRoute has really just latched on to what the country already does best. Maybe it’s innovative to us outsiders, but in Nicaragua, it’s the norm.

If you enjoyed this post, you might also like:

Blog Tags: interns   last mile   Latin America   Nicaragua      solar light   solar technology   

Morgan Babbs, founder & CEO of SolarRoute, conducts a solar tech demonstration.
Morgan Babbs (far right), founder & CEO of SolarRoute, conducts a solar tech demonstration. Photo © SolarRoute