FIP 91: Alexandra Fiorillo on behavioral science and social impact

Today, we speak with Alexandra Fiorillo of GRID Impact on how to incorporate behavioral design elements into social enterprises to maximize impact.

On this episode:

  • Alexandra defines behavioral design as the integration of the mindsets of the two disciplines of human-centered design and behavioral science. She explains how behavioral science is the study of action-taking and is often very focused on a single moment in time or decision while human-centered design is an empathy-based collaborative process which is used as a problem-solving tool. When these two are combined together, you have a discipline that addresses both how humans actually behave and as well as what their aspirations are.
  • Some of the elements of behavioral science that contribute to behavioral design include biases that create barriers to behavior, such as status quo or default bias. Understanding default bias is important for designers so they can think about how they can develop an active choice set.
  • Alexandra shares some of the ways behavioral design contributes to social enterprises, including helping companies create customer acquisition and retention strategies and develop marketing materials and pricing policies.
  • She goes in-depth on the example of sanitation, noting that just because a toilet is “better” does not mean it is necessarily going to be embraced by customers. Some of the barriers to adopting a new product – especially in the case of sanitation – could include social norms and mental barriers.
  • Another example from the global health field is kangaroo mother care, which Alexandra notes will not be taken up just because it is recommended. In this case, GRID Impact has worked to redesign and test new counseling experiences with families that employ visual story telling methods. As kangaroo mother care use usually drop-offs after hospital discharge, they are also testing a new method of turning the moment of discharge into something celebratory that encourages future use of the method.
  • Some of the practical principles of behavioral designs highlighted by Alexandra include focusing on changing the context of the decision and not the person. She also addresses “nudges” and advises that social enterprises think about incorporating the three principles of nudges: never mislead and always be transparent, always provide people with alternatives, and have a clear reason about why the nudge will ultimately be good for the person that is being nudged.
  • Her final tips are that social entrepreneur leaders should also consider their employees to be their users, focus on redesigning tiny moments, run micro-experiments, make evidence-based decisions, and understanding that some biases can actually be a combination of multiple biases.

Links to Resources:

Connect with Alexandra:

lauren fletcher finding impact podcast

FIP 90: Drones for Social Enterprise? Imagining What’s Possible with Lauren Fletcher

Today we’re doing a replay of my interview with Lauren Fletcher of Biocarbon Engineering – a social enterprise that is imagining what is possible with drones – and this, he describes, is about reforesting the planet at scale. This is the last in our three part series on high tech for development.

Some of the things you’ll learn on this podcast include:

  • How social entrepreneurs should always be stepping back to see how their product or solution fits within the bigger picture, which can, specifically, link you up with those who have available resources to help you go further.
  • How Laurent went about finding his founding team, and how he looked for people with exposure and basic understanding of the subject matter he needed.
  • Their strategy of finding early capital, where they went after equity, prizes and government grants
  • We learn the downside of going after prizes, including how they are a lot of work for not alot of money, but the upside was a viral video that got over a million views that gave them the notoriety to attract seed round investors
  • How their product development roadmap panned out, which included building a pre-prototype basic flying planting machine in 3 weeks for the Drones for Good competition in Dubai.
  • How they’re thinking about getting their first clients, and the short to long term vision for revenue generation and growth

Resources:

Connect with Lauren

 

FIP 89: High Tech Bio Tech for Development with Eddy Agbo of Fyodor Biotech

For the second episode in our high tech for development episode, I’m speaking to Eddy Agbo of Fyodor Biotech. We speak about early diagnostic methods that are changing the game for global health and the opportunities these represent for social enterprise. Eddy is the CEO of Fyodor Biotech, he’s a PHD from Utrecht University in the Netherlands in molecular genetics and has a post-doctoral fellowship in medicine and infectious diseases at John Hopkins. Fyodor Biotech is building a portfolio of non-invasive fever diagnostic products for emerging markets, of which one, they’re now commercialising, is the Urine Malaria Test (UMT) – a test for malaria that tells within 25minutes if a fever is malaria, using only a few drops of urine.

On this episode you’ll learn:

  • Malaria diagnosis is a field that hadn’t evolved for over a hundred years until the 1970s, and then again today. So the time to big disruption has reduced from 100 years to 40. The big innovation has been to remove the guess work in whether someone has malaria or not.
  • The UMT product took 8 years to get to market, and has been sold commercially now for two years in Nigeria and Liberia only. Their strategy is to target the private healthcare sector first.
  • They started developing the product in the market crash of 2008 so funding was a challenge, so they had to bootstrap and form strategic partnerships.
  • They competed for public grant funding in the life sciences sector from the US or British governments.
  • They were able to raise equity funding from different funders during the development stage. When the technology was developed and in people’s hands, it made a difference to their funding, and they received much more interest from investors.
  • They’re distributing to both business and consumers. They’re working with major pharmaceutical distributors, but are also allowing customers to purchase directly from them.
  • They have distribution partnerships with a range of suppliers, mostly of the online marketing kind.
  • They went to the Nigerian market first, because of the size of that market, because they wanted to get to scale in a market where the impact could be felt and where they could eventually achieve a lower price point for the public sector. And Nigeria has a large private health sector which is key to their growth strategy.
  • Their partnership with John Hopkins was due to a key part of the technology they licensed from them. They have a global, exclusive license from them, which was critical because of the credibility it has brought and the resources they’ve drawn on to help them succeed.
  • They do their early stage research in the US and later stage development in the target market. This meant bringing blood and urine samples into the US, and the red tape was such a challenge. But it was something John Hopkins was able to help with, since they had extensive experience with this.
  • John Hopkins also provided some crucial early introductions that helped with funding and access to important resources in the product development.
  • They implemented a major clinical trial (2000 participants) that built compelling evidence that helped with investor funding.
  • It was published in leading journals (see link below)
  • Functionality testing had to show that a certain skilled level of operator can do the tests, and that an acceptable product shelf life could be.
  • Eddy’s vision is to build a portfolio of products that could help populations in the developing world with a fever, to help in the initial diagnostic stages, to know what has caused the fever and remove the presumptive diagnostic process in patient care.

Links to resources

Connect with guest

elizabeth-rossiello finding impact

FIP 88: Using Cryptocurrencies in Social Enterprise with Elizabeth Rossiello from BitPesa

This week we’re kicking of a mini-series on high-tech for business within a developing country context. We’re talking to Elizabeth Rossiello, who co-founded BitPesa Ltd in 2014 and serves as its Chief Executive Officer. Elizabeth has worked in Kenya as a Microfinance Analyst and Investment Associate since 2009. She is an expert in East African financial product development and establishing best practices in risk, governance and IT for local banks. Prior to her work in East Africa, she served as an Analyst at Credit Suisse in Zurich and a Robert Bosch Fellow in Frankfurt. She speaks four languages and has a Masters in International Finance from Columbia University’s SIPA.

On this episode you’ll learn:

  • Cryptocurrency can be compared to how letters (snail mail) used to be sent to another country, and now email has replaced that. Cryptocurrency, or Bitcoin, was created to replace the traditional way of sending money to another person. Bitpesa is sending money around the world a lot cheaper than traditional means. They’re increasing liquidity for companies.
  • Bitpesa’s business model is to take a small percentage on each international money transfer transaction.
  • Bitpesa doesn’t hold Bitcoin overnight so they’re not affected by the fluctuating price that the currency has seen.
  • Elizabeth built the simplest test case of how it could work. She hired one engineer and one UX (User Experience) team. They built it on the Mpesa system in Kenya to test it out. It took a month and a half. Their first customer traded in January 2014, and they relaunched in April with a market-ready product.
  • The regulatory framework was setup for traditional money transfers, but Bitpesa showed they were doing the same thing just using a different tool to do so.
  • Working with regulators still makes up part of their work today. It’s about ensuring they’re following the rules, and keeping the focus away from what the technology is.
  • They’ve had plenty of setbacks, such as being sued by Safaricom in Kenya, and potential investors who learnt from their company and ended up creating something similar.
  • Bitpesa started out on a small $50k seed investment which they used to build the prototype, and then raised follow on investment from international investors. Follow on investors were only willing to put in cash for 6-12 months runway, so Elizabeth says it was a really inefficient fundraising process.
  • Elizabeth advises to enjoy the ride, because it’s a long journey. Enjoy building a company that you want to work for. And take care of yourself along the way.

Links to resources:

Connect with guest:

 

FIP 87: Audience Stories – Ravi Shankar from AcceleratED

Today, we speak with Ravi Shankar of AcceleratED on how Finding Impact has helped the company as it doubles its operations during its growth phase, for which learning from others’ mistakes has been critical.

On this episode:

  • Ravi noted that there had been multiple podcast episodes that have been helpful to his company.
  • An episode that was particularly helpful to Ravi was Episode 78 with Raghu Krishnaswamy. Ravi took away Raghu’s focus on “casting” and building a diverse culture within a team. Some tricks that AcceleratED borrowed from the episode include:
    • Hiring: The company is now taking a “casting” approach to hiring and employing a portfolio approach to human capital management.
    • Retainment: Thinking through the employee life cycle and applying user center design aspects to it.
    • Culture: Connecting with people on a personal level, not just a professional level. They have created a “Hobby Hour” to share interests from outside the office.
  • Ravi noted that when any company is very small, it is easy to develop a culture but can often result in people becoming copies of each other or suffering from group think. Now, AcceleratED is building an internal culture guide to share both successes and vulnerabilities.
  • Ravi was struck by the irony that AcceleratED itself is a behavior change-focused organization, but it is only now that they are incorporating some of the behavior change elements from the business model back into the operations of the company.

Links to Resources:

Connect with Ravi:

Rachel Sklar Finding Impact

FIP 86: Audience Stories – Rachel Sklar from Pit Vidura

Rachel Sklar takes the guest seat this week to tell us how the Finding Impact Podcast is helping her with her business in Rwanda. Rachel runs Pit Vidura, which offers pit latrine emptying services in dense urban areas where there are no sewers.

On this episode you’ll learn

  • Apart from helping to improve her business, the podcast has helped Rachel get back into long distance running! When she’s back at her desk Rachel listens to bits again and writes down the parts that were the most insightful and sends it to members of her team, inviting them to listen and come back to her to have a conversation about it.
  • The podcast is confirmation to Rachel that they’re on the right track. Sometimes they have to make stuff up on the fly and under pressure. So later when they listen, they realise others have taken their course of action as well. The podcast also confirms that not everyone has the answers before they start.
  • Rachel and her team are not from a business background so some of the knowledge, in the form of frameworks or processes, is really useful.
  • They also hear that others are doing the same thing they are, but they speak about it using more formal language and approaches. So it allows Rachel and her team to redevelop their strategy in a more structured way and speak to people externally using the right language.
  • She loved the episode with Lauren from GetIt about how her food distribution business soon became a logistics business, since this is what their pit emptying business has become.
  • Fausto’s episode was also instructive in that he shared how the early days were so scrappy, and they survived from winning a few prizes and surviving off of customer revenues, which is how it’s been with Pit Vidura. Fausto was also open and honest about the emotional side of a startup, and the thoughts of failure, which Rachel experiences.
  • The interview with Jonathan Lewis also resonated with Rachel, about a sector-wide problem which is the lack of diversity in social enterprise, and which she’s now building into the values of her company to intentionally confront this.
  • The episode with Rob Mills helped Rachel talk about social enterprise to more traditional investors, and help them understand what a social enterprise is.
  • Rachel really enjoyed the episode on unit economics with Steve Andrews. As with many social enterprises serving the base of the pyramid, you need to be so clued-up on your unit economics and use it as a management tool for decision making.
  • We talk about imposter syndrome, where you feel you don’t have enough of experience, knowledge, skills, (insert next one here!)… to build a business. Rachel has found listening to the podcast has made her realise that everyone’s in the same boat – no one really knows everything they’re going to do from the beginning and there are times you’ve just got to do your best.
  • Human capital is a constant struggle and something that doesn’t just go away, but needs constant effort behind a clear strategy. Cycling through employees, particularly during the early days, is an approach others take as well, whilst jealously guarding culture.
  • Also, we discuss a very open style of management, where you get to know your team personally, as described by Raghu Krishnasway.
  • Rachel suggests a way to improve the podcast could be to touch on people’s personal careers or lives, maybe even an activity, a quote, a joke, or something, so that listeners get a little more sense of their personality.

Links to resources:

Connect with Rachel:

 

FIP 85: Audience Stories – Emily Woods from Sanivation

Today, we speak with Emily Woods of Sanivation on how one episode of Finding Impact helped her re-think how her company’s culture and values were created and defined.

On this episode:

  • Emily talks about the process of defining the company culture and establishing its values in advance of a high growth phase. The first time they had done this exercise was in 2015 when the company had 15 employees. At the time, they established seven core values but it seemed that these were too numerous for employees to remember and act upon.
  • They decided to do a second exercise to define the company’s purpose and values,  which was inspired by FIP’s Episode 63 with guest Ayla Schlosser. Multiple people within the company had recommended the episode, and Emily found that Ayla not only gave a clear description of her organization’s purpose but also really showed why company values are important.
  • She realized that Alya’s hummingbird story was really great for Resonate, but would not work for Sanivation. Emily noted that the story of the sanitation sector was that people were always looking to solve a problem, but not necessarily thinking through how to do it in the clear and best ways so the hummingbird story would need some adaptation.
  • Emily employed Ayla’s process for drafting company values in Sanivation, including making sure that everyone at the company was consulted and asking everyone what they are proudest of about the company.
  • Sanivation’s culture creation process focused on the management meeting with each team to discuss the current core values, if they remember them, and how they use them. That information was taken from each team to a day-long workshop with the managers, where discussion continued. Emily learned that it takes a while for people to think about what they are most proud of and would even recommend that companies take even longer with this process to ensure thorough feedback.
  • For Sanivation, the outcomes of the second company value creation workshop reduced the number of values from seven to three. Sanivation’s corporate values are: passion for impact, putting people first, and delivering results. From these core values, Sanivation wants to go on to create competencies upon which evaluative KPIs can be used, as well as decision principles for staff to use in everyday operations.

Links to Resources:

Connect with Emily:

Lindsay Stradley Finding Impact

FIP 84: How to Build a Relationship with Your Core Customer Base with Lindsay Stradley

Lindsay Stradley is co-founder of Sanergy which is making sanitation hygienic and affordable in Africa’s informal settlements using a franchised network of toilets run by local residents. Sanergy converts the waste into valuable byproducts, which are sold to keep the system sustainable. Lindsay is an alumni of MIT and Yale, she founded a charter school in New Orleans after Hurricane Katrina, has worked at Teach for America and Google, and now lives in Nairobi, Kenya.

On this episode you’ll learn:

  • Lindsay draws on experience from her earlier career when starting up a charter school. She had to show up where customers were, which meant traveling around south-eastern America to let everyone know that a school was opening. And at Google it was her experience thinking about scaling effectively.
  • Sanergy has a B2B (business to business) relationship with clients. They segment them by their businesses, which meant (1) Small-business owners (e.g., kiosks, water points); (2) Schools & other community institutions; and (3) Landlords.
  • For each of your customer segments, it’s essential to understand the value you’re creating for the end user and their decision making criteria.
  • Across all three of their customer segments, Sanergy offers the same core product, but with a slightly different bundle of services and ancillary products that speaks to their needs.
  • They started their business focusing on the most obvious need and demand within the community, which became their first customer segment. Then they expanded out to the next biggest area of demand – within schools – and then the next – landlords. Starting in this way helped them establish their brand within the community and iron out any operational kinks.
  • Within the first segment, it was actually split into two sub-segments. So segmentation is continually evolving as the customer base grows.
  • To test product-market fit with each of these segments, they utilise their field teams to get qualitative feedback from non-customers on where the gaps are. Pair this with available data, then pilot! And hone in on the early feedback from the new customers on effectively filling the gap.
  • At the beginning, all customers were on the same price point but now they have differentiated pricing for each customer segment. They look at the cost of materials and cost of serving the customer segment. They even moved away from their traditional asset sale pricing for their landlord segment, moving to a subscription model, based on an understanding of the decision making process of this customer segment.
  • Thinking about setting prices initially, social enterprises need to understand their costs at a certain scale, and after adding your margin, this is a starting point for your pricing. You then need to decide whether you are willing to take a loss to reach a certain customer, or take a loss on a cashflow basis because you assume that you’ll make up your margin during the lifetime of that customer (over the long term).
  • To determine who in your business has a relationship with your customer, you start from the operational needs, and then figure out how best to leverage those customer touch points to serve the customer as much as they need.
  • In terms of whether Sanergy train their staff in different ways, depending on which customer segment they’re serving, they’ve gone back and forth on this. It’s only their sales team that are split by geographical area, but not per customer segment. Mainly because most new customers are coming from one of their three customer segments, so most of the sales teams are focusing there. Also, their operational efficiency was being limited when splitting customer service agents by a specific customer segment. So now they focus on a geographical area in the first instance.
  • When first thinking about customer segmentation, you can see how other businesses operating in your geographical area (and serving the same customer demographic) are doing it. When Sanergy first started, they studied the marketing, sales and operational processes of Coca-Cola and M-Pesa. Both of them use a B2B network to reach an extremely high percentage of customers in Nairobi’s informal settlements.

Links to further resources:

Connect with Lindsay:

 

FIP 83: Marketing in Emerging Markets with Amanda Arch of Kasha

Today, we speak with Amanda Arch of Kasha on how it uses online and mobile platforms to market and deliver health products to middle class and BOP consumers in Rwanda.

On this episode:

  • Amanda explains Kasha’s development in Rwanda, which began with building out an MVP of the technology and then working with different customer segment test groups.
  • Amanda shared that Kasha partnered with non-profits deeply imbedded in Kigali, universities, and associations of professional women to set up test groups that ring fence customers with very similar and specific characteristics to build profiles.
  • Lessons learned from this process are: (1) there is a difference between excitement and ordering, so the company needs a strong feedback loop with customers, and (2) people really wanted to see products in person before ordering, so it is really important to have products on hand as part of the customer acquisition process.
  • Amanda also recommends developing power users and / or brand ambassadors that can get feedback from other users, as well as providing post-event communications methods (such as Whatsapp).
  • Their three core customer segments are BOP customers, university students, and professional women, which are designated into these groups by ordering or delivering method. Amanda detailed how Kasha chose their segment marketing methods, which started with looking at what else was happening in the market and what the best practices are (for example, agent-based networks in rural communities) and then customized these channels for Kasha. Each segment has different messaging, events, and specials based on their group’s characteristics.
  • She also explained that in the early stages, the company only tested messages and channels to understand their efficacy, not their cost. This allowed the company to make an investment in the brand that would not make sense for unit economics as they scale up. In the next phase, they really focused on customer acquisition data with an overall eye on lifetime value per marketing investment.
  • During interactions with customers, Kasha also seeks to capture data for themselves to better understand their core customers as well as verify it with other external sources. Amanda also provides some of the company’s key KPIs including orders across segment, repeat orders, unique customers, and average basket size. She also shares some insight into the business model which looks at average basket size across different segments in order to resist only serving more profitable segments or limiting the platform to higher margin products.

Links to resources:

Connect with Amanda:

David Henia Finding Impact

FIP 82: Building an Iterative Product Testing Platform with David Henia

David Henia has been the Lead Developer at Eneza for the last two years and is in charge of product, technical and back-end development. Prior to his role at Eneza Education, he held a variety of roles at different technology development and software firms in Nairobi. David has a BsC in Computer Science from Africa Nazarene University. Eneza Education is a comprehensive virtual tutor, that provides universal access to affordable, quality, lifelong learning through dumb and smart phones. 70% of its users are low income students in rural areas. It has 4.9 million users and is Africa’s leading mobile online learning platform.

On this episode, David walks us through Eneza’s products tests and and how to design and run experiments on product features, pricing, and marketing campaigns, etc. The goal of this episode is to teach social entrepreneurs how to build their own product testing methods.

On this episode you’ll learn:

  • A product testing platform is essential for any startup organisation because the startup is like one big experiment, so you need to keep your learning organised.
  • Any organisation will surface many ideas about what to do – they come from your customer, yourself, your team – but without organising these ideas, they’ll soon slow you down or even move you backward.
  • Establishing an iterative product testing process also builds autonomy within your team, so team members can discern which ideas to park and which to take forward.
  • Ensure you’re collecting all the ideas that the organisation surfaces, and with the team, try to find the root problem that the idea is addressing or relating to. Then determine the time involved, the cost and the effect on profit and/or impact.
  • With a good handle on the problem, then you can start to build experiments and test ideas that can solve the problem.
  • This process is managed by the product team, who is led by the Product Manager. They work with all departments and are the representative of the customer.
  • To prioritise projects, you can use the RICE framework, which means Reach, so how many customers will the product or test reach, impact to the business, in terms of profit and/or impact, how Confident are you about the results, and how much Effort in terms of time, money and people.
  • Then come up with a hypothesis, e.g. if you do X then you guess Y and Z will happen, because of what you’ve observed. And success will look like A, B and C. And it will be measured by S.
  • Then you build a Minimum Viable Test to get some quick feedback over a week or two, independent of any other teams internally.
  • The engineering team isn’t involved until the tests have been conducted and the decision made to build the product or feature (although the engineering team leadership is involved in this decision).
  • General indicators exist which can help you benchmark your organisation against industry standards, such as customer lifetime value, customer acquisition cost, unit economics, etc.

Links to resources:

Connect with David: