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FIP 67: Profit vs. Impact 3/3 – with Arielle Molino of Intellecap

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Today we hear from Arielle Molino of Intellecap, which is a firm that supports business solutions to poverty through consulting, impact investing activities, and the Sankalp conferences in India and East Africa.

On this episode you’ll learn:

  • Why Arielle doesn’t like to say “profit versus impact” but instead “profit and impact” and her viewpoint that they are not competitive interests. She explains that this can be achieved when the impact is inherent in the business model itself.
  • Arielle highlights the importance of listening to and understanding the customer needs – focusing on whether the product is too expensive, not easy to use, etc. – and shaping a business model around that, not trying to start with a customer segment with a certain purchasing power.
  • Arielle explains that even for enterprises that are targeting the BOP, it is important still to do customer segmenting, as there are very real customer differences between low BOP and medium BOP.
  • With specific customer knowledge, enterprises are able to build products that enhance their clients’ productivity or quality of life, no matter where they are on the income spectrum, which is the real impact of the company.
  • She also notes that she doesn’t think it is always the case that entrepreneurs must target higher income customers, as it has been proven time and again that those companies can breakeven, it is just a question of scale and timing.
  • She does not advocate, however, that everything needs to be a business or be profitable, but it is important to know and acknowledge the difference between social businesses and social services.
  • Arielle also talks about the importance of the entrepreneur being able to “sell” or be convincing of the impact story of the company, as investors and donors have very diverse impact lenses. But she also makes it clear that the founder needs to be able to back up their impact story with data.
  • She also recommends entrepreneurs not to be too focused on the having to have every detail of their impact model figured, as the concept is not black and white for most stakeholders, even those very experienced in the impact space.
  • Arielle tells us that if an enterprise has a good business model, a high quality management team, and the impact is there, the money will come.
  • She also wants entrepreneurs to be picky about their investors and make sure that the investors are aligned with their business and do due diligence on the investors as well.

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FIP 66: Profit vs. Impact 2/3 – with Tom Adams of Acumen

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Today on the podcast Ashlee Tuttleman interviews Tom Adams of Acumen. As Chief Impact Officer, Tom leads the organizations’ work towards creating impact through patient capital investing. Acumen have pioneered Lean DataSM, an approach to data collection which helps to build more impactful businesses by providing them with data on their social performance, customer feedback and customer behaviour.

On this episode you’ll learn:

  • What we do and don’t know about social performance – and why is that? Tom pushes us to examine our own biases.
  • Traditional aid can work, but sometimes a different type of approach is needed. People can pay for services instead of accepting pure charity. Tom tells us about philanthropic capital investment.
  • Tom talks about what it was like for Acumen to pioneer this type of program 20 years ago before anyone else had entered this space. It takes a lot of patience.
  • He tells us about what it is like to work in a space where standards and norms aren’t developed in the traditional sense. They’re looking for ways  to standardize social performance data on an on-going basis in the same way other industries do.
  • Need to build repeatable systems and methods to understand social performance. Impact from year to year will change. There is no playbook!
  • Acumen Invested in remote data collection to drive down costs. (SMS, text, phone calls etc. were an obvious place to start.)
  • There is always complexity around getting good data and avoiding bias. At its core, it boils down to listening to people and listening to your customers.
  • Be open to hearing about unintended consequences. Something that seems inherently positive can have unintended negative effects.
  • JD Power is a shining example of the successful use of consumer reports. Engineers had always ‘known best’ when it came to making cars. JD Power found they had more success when they included consumers in the equation and asked them what they wanted!
  • Invest in your monitoring and evaluation in the beginning of your work. (Needs to be a core part of a socially oriented organization).
  • Positive social change starts with listening to the user.
  • How do you get started in the beginning? Getting the basics of customer feedback in place can be simple. Net promoter score? General feedback? How likely are you likely to recommend? Build from there.
  • When it comes down to it, the basics of this work are continuous listening. You don’t need to overcomplicate it with specific measurements.
  • More remote you can be the more likely you can trust the data. (People are more likely to alter their response in-person). The goal is unbiased data.

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FIP 65: Profit vs Impact Series 1/3 – with Arjun Bolangdy

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For the first episode in our three-part series on “Profit Versus Impact”, today we hear from Arjun Bolangdy, Associate Vice President – Strategic Projects of Pollinate Energy, with a mission to improve the lives of India’s urban poor. Through providing energy products to BOP markets, Pollinate Energy works to improve their customers everyday lives, while at the same time empowering local entrepreneurs in India and raising awareness of social business across the country.

On this episode you’ll learn:

  • Arjun explains how Pollinate Energy’s unique fundraising model – with a non-profit enterprise in Australia which wholly-owns a for-profit in India – allows for the organization to scale to different cities and finance other value-addition activities.
  • How to low income customers pay for these products? Arjun details how Pollinate Energy extends credit to make their products affordable to their customers and how that relates back to making the company financially sustainable in each city.
  • Arjun details the overall model of the company, including the different and important roles of Pollinate Energy Australia and Pollinate Energy India and how the integration of these roles supports a growth model that covers Pollinate Energy India’s costs during the 18-24 month period it requires to breakeven in new cities.
  • What are other interesting aspects of Pollinate Energy’s model? Arjun shares about the company’s multiple fellowship programs that include “scout” fellows to map urban slums in new cities, as well as city “co-founders” to lead Pollinate Energy’s expansion into the city.
  • Arjun talks about the importance of balancing impact versus growth, for which the company uses city financial sustainability as a key metric. He explained the enterprise’s strategic decision to pause expansion for 2018 to focus on deepening its impact in the communities it already serves versus continual growth.
  • Finally, Arjun also spoke to some of their impact measurement tools, which center on customer surveys on direct impacts (shifts from kerosene-based to solar energy use) and indirect impacts (such as improved health, education outcomes, etc.), and how that data relates back to their fundraising model.

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