Articles by Blair Miller

Imagine yourself in rural India, driving down a pothole-filled road as the sun’s 90 degree heat pounds down on you in the car - without air conditioning, of course. Sweat is dripping from every pore of your body; all you want is a cold drink and a long nap.

But no. Instead, you are putting together a spreadsheet tracking each of the local dealers who are going to distribute your low-cost, low-margin product to the base of the pyramid. You have just met 5 dealers in the past six hours plus you plan to meet another 50 in the coming week and your boss (a venture backed entrepreneur) has to report the numbers to his investors by 5pm that day. And by the way, he asked you for the information this morning when he called you on your cell - which barely gets any signal.

This is not the typical role of an ex-Silicon Valley venture capitalist and Stanford MBA graduate normally finds himself playing. So why in the world did this particular individual want to do this kind of work - and what type of leader does it really take to succeed in this field? As the manger of Acumen Fund’s Fellows Program it is my job to know.

So what do I think are the skills needed to succeed in this field? Here are the the “Three R’s” of Social Sector Leadership, which I believe are all necessary ingredients for success and some characteristics that I believe truly differentiate the social sector from others.

1. Resilience: For those of you who are clamoring to get into this sector, I first want to dispel the romantic vision of social entrepreneurship; taking a business to scale in this sector is incredibly hard and takes extraordinary humility, patience, and sheer resilience. Be prepared to bang your head again about 10 doors before you manage to open one. And that data you have to report in a beautiful, McKinsey-style deck is often hidden in tens and hundreds of hand-written ledgers (that’s right - many social enterprises are not IT enabled! There is even one company we know of that has 7 million clients and not a single e-mail account - can you believe it!).

Resilience is not about the physical challenges you will face on a day to day basis (though they are important, too); it is about the emotional battle you will encounter with yourself every day. Most days you will think you are crazy to do this stuff, and your mind will try to convince your heart to quit. A real leader in this sector is one who wakes up every morning ready to battle this fear and goes to bed every night exhausted and fulfilled. So your job as a leader, mentor, friend, fellow, or peer is to encourage each other to keep fighting, because those are the leaders we need. There is a great TED talk up about by Elizabeth Gilbert discussing this issue and the constant battle between your inner demon and genius… check it out.

2. Resourcefulness: I recently heard a presentation by the leadership guru Tony Robbins in which he said too many people spend their time making excuses and that the defining factor for a leader is not resources - it is resourcefulness. This could not be more true for leaders in the social sector. If social sector leaders simply said “sorry, I don’t have the resources to make this happen” we would not see some of today’s leading organizations like LifeSpring, Aravind, Ashoka, Echoing Green, Kashf Foundation - just to name a few.

So I encourage leaders in this sector to create change by reevaluating, reassessing, and re-organizing their resources. Spend your time mapping your assets to understand what you do have and then just go for it.

3. Reflection and Empathy: I cannot emphasize this capability enough. Innovation is a practice of trial and error, and yes there will be errors… many. The leaders that I value most are the ones who take the time learn from their failures not the ones who don’t make any (which of course there are none).

So I encourage young leaders out there to take the time to write in a journal, discuss a thoughtful article, and enjoy the company of your own thoughts. Reflection takes practice and discipline but it will pay off in spades when you find yourself battling the daily challenges of the social sector and it will teach you how to learn from your mistakes and find more innovative and lasting solutions.

And so there you have it - reflections from the Acumen Fund Fellows Manager. Do you have these capabilities? If so, I hope to see your application this fall for the Class of 2011 Fellows Program!!

This past Friday, we were fortunate to have Pratyush Pandey, Managing Director of Global Easy Water Products (GEWP) join us for breakfast at our offices in New York. Joining Pratyush for breakfast were a number of Acumen Fund Partners and staff. GEWP is a for-profit company that manufactures, distributes and sells drip irrigation systems to smallholder farmers in seven states across India; Pratyush was in town following the final presentation for the Legatum Prize (GEWP was among the five finalists; unfortunately, they did not win the USD $1 million award).

In any case, back to the breakfast. Pratyush’s talk – and the subsequent discussion – left me with three key takeaways and an important reminder:

Takeaway 1: Building a successful business serving the low-income market requires listening to the poor and building a product or service based on the specific needs and constraints of those living at the base of the pyramid.

GEWP – and its parent company, International Development Enterprises - India (IDE-I) – sell four types of irrigation systems. The systems vary in cost and depend on the specific preferences of the farmer. Not only does this enhance affordability, but the modular system design allows the farmer to add acreage incrementally as they generate profits from increased production. For example, a typical GEWP customer starts by irrigating one crop; after a successful season, he’ll add acreage and drip-irrigate another two or three.

Takeaway 2: In order to scale, GEWP must recognize market opportunity while strengthening its in-house capabilities.

While the need for drip irrigation in India is acute, GEWP’s business there is relatively seasonal (in the monsoon season, sales drop significantly). Understanding this aspect of his business and global demand for drip irrigation, Pratyush developed an international distribution strategy that sells drip irrigation in nine countries in Africa and seven additional countries in Asia. GEWP has also ramped up its in-house manufacturing capabilities in order to lower the costs associated with purchasing the irrigation systems externally.

Takeaway 3: Successfully marketing to low-income farmers is about tapping into the current infrastructure of local non-governmental organizations and other embedded actors who have earned the farmers’ trust.

GEWP’s success is largely due to the 20-year track record and network built by IDE-India. These lessons can be applied globally. For instance, Acumen Fund recently invested in a new, for-profit company in Sindh, Pakistan called Micro Drip. Much as GEWP is associated with IDE-I, Micro Drip is tied up with the Thardeep Rural Development Program (TRDP), a 16-year old agricultural services non-profit with a long-established network of smallholder farmers for whom drip irrigation technology can have enormous benefits.

Three key takeaways: listen, understand the market and leverage trusted partners. In addition to these three key lessons – which, if you look at them, seem to be relevant to all sectors, not just drip irrigation – there was an important closing aside.

As the breakfast came to a close, Acumen Fund’s India Business Manager, Biju Mohandas, gave us an important reminder. Biju, on his last day in the New York office prior to returning to India, asked us to remember that while most Americans think a typical Indian is the man working at a call center or at an IT firm, almost 70% of the country’s population are farmers. And at the end of the day, India’s sustained growth is dependent of the success of its farmers – and those farmers’ success might depend on the growth of innovative enterprises like GEWP.

At a time when the world is experiencing an incredible economic crisis, it was powerful to sit in Lehman Brothers’ Midtown Manhattan office Tuesday night to hear Jeffery Sachs, head of the Millennium Project and Director of the Earth Institute, and Jacqueline Novogratz, CEO of Acumen Fund, speak about how to address the issues of global poverty.

More than 300 Lehman employees and guests filled the auditorium, listening to two of the most influential leaders in the social sector discuss the role of public and private approaches in alleviating global poverty. Millennium Promise and Acumen Fund have each received significant philanthropic support from Lehman Brothers, and Lehman Brothers’ $5 million gift to Acumen Fund made them our first Corporate Steward in our $100 million capital campaign.

The evening served as an opportunity for Sachs and Novogratz to explore ways to bring together top-down and bottom-up approaches to fight poverty. And while we would all love to know that there are simple, straightforward solutions, it was clear from the speakers’ comments that multiple approaches are needed to tackle poverty.

This idea was wonderfully illustrated by Jacqueline’s vivid story of the seven-foot-tall sunflowers growing in the middle of the Thar desert of Pakistan. Local smallholder farmers can grow these sunflowers because they are finally able to receive water through the use of a micro drip irrigation technology distributed by a local entrepreneur and Acumen Fund investee, Micro Drip, in addition to a government subsidy that provided solar panels to power the generators that extract groundwater.

Can you imagine a world in which water is so scarce, it has to be transported to your community via a government-operated train or if the only safe way for you to consume your morning glass of water is via a dirty pond with a 12-inch long filtering straw? Believe it or not, for billions of people across the world, quick fixes like these are their everyday reality.

1.2 billion people lack access to safe drinking water; 2.4 billion lack access to improved sanitation (UNEP). Adrien Couton, Acumen’s Water Portfolio Manager, cited these statistics and others at Acumen Fund’s Water breakfast this week. Despite such sobering numbers, I came away from the breakfast with a sense of hope that even though there is no silver bullet, we are getting closer to understanding how to address the complex issue of water.

Adrien first discussed the need to move beyond our strong inclination that the latest and greatest technology will solve all of our problems. A perfect example is Water Health International (WHI), an Acumen Fund investment since 2003. Water Health International recognized that just because they had a proven technology didn’t mean the poor were going to buy their water.

As I walked into Desmond Tutu Center in New York on Thursday night, I wasn’t quite sure what to expect from the social networking event hosted by Good Capital. Good Capital is an investment fund aiming to accelerate the flows of capital to social enterprises, and they successfully convened an incredible group of colleagues, investors, and friends.

Just to give you a sense of the event, my first conversation was with two women from Scojo Foundation, an Acumen Fund investee that reduces poverty and generates opportunity through the sale of affordable reading glasses. I then had the pleasure of talking with Tim Freundlich, a partner at Good Capital, who - among other things - told me of the upcoming conference they are hosting in San Francisco in October. This was followed by a conversation on community building with Jed Emerson, one of the leading thinkers on Blended Value and also an Acumen Fund and Good Capital Advisor.

I finished up the evening discussing the growing spectrum of capital with two fellow Michigan Alumni, Josh Cohen of City Light Capital, a money management and business development firm that focuses on the security, media and energy sectors, and Michael Baratoff of Equilibrium Capital, a growth equity fund focused on sustainability.

As I walked out of the event into the breathtaking and serene courtyard of the seminary behind the Tutu Center I realized that we are no longer a few disparate mavericks but instead an interconnected community leading a movement that can demonstrate the power of the market as a tool for sustainable and innovative solutions to social problems.

I just returned from an energizing trip to the University of Virginia, which is both Jacqueline’s and my alma mater. At UVA, I taught two classes in the business school’s newly developed Integrated Core Experience (ICE) program - one on Acumen Fund and the other on Social Venture Capital. The students - all undergraduates - were an engaged and inquisitive group. Throughout the 7-week course, the students are exploring different ways to approach global poverty, ranging from a charity-based model to a market-based approach.

There were two really exciting things about this trip. First, I continue to be energized by the way top universities are integrating the field of social entrepreneurship into their core curriculum. This is really an essential piece of what we are doing in our knowledge pillar, in terms of sharing our best practices and institutionalizing what we’re learning.

Second, I was amazed by the students‘ passion and curiosity as well as that of the professors. They are really working to understand the unique business models, challenges, and insights of our work. There is momentum here that brings to life the entrepreneurial spirit in so many. At Acumen, we are thinking hard about the best ways to harness the energy of students and young professionals. We would love to hear your thoughts, so please respond to this blog posting with ideas and suggestions!

A recent article in the McKinsey Quarterly, drawn from a joint report conducted with the IFC and Gates Foundation, predicts that due to the growing demand, $20 billion of additional investment in private sector (which includes private, social enterprise, and nonprofit) health care in Africa will take place in the next decade. From my perspective this study reveals two important issues for social investors. First, this is a great opportunity for us to make smart investments, collaborate with others, and provide the assistance needed to help scale and replicate innovative healthcare models. Second, and perhaps most pressing, we will all have a significant role to play in sharing our insights and lessons learned to ensure that this enormous flood of capital hears the voices of Africa’s poor.

On Tuesday, Acumen Fund hosted its annual Investor Gathering and Celebration, two of the most important events of the year for us and our community, and the culmination of months of preparation.

Our day-long Investor Gathering allowed us to share our past progress and future strategy with our partner community. Katherine Fulton set the tone for the day, noting shifting trends in philanthropy and the work of engaged donors in leading this new movement. (You can read more about her remarks - and the day - on one of our favorite blogs, nextbillion.net.)

The day was full of memorable discussions, but perhaps the most memorable was a moving performance by the 2008 Acumen Fund fellows who shared their personal stories about the winding road that lead them to Acumen. The Fellows left yesterday for their work with our investment enterprises in Kenya, Pakistan and India, so it was a beautiful way to end their time with the Acumen Fund team in New York.

Overall the day was a celebration of our community and a reminder of how important this work is. You will hear more about the day in coming weeks, from our team as well as from others in our community.

One of the things we heave heard from our community is the value they place on insights direct from the field. As we think about how best to make this information readily available, we have discovered the importance of creating connections to those who have truly lived and experienced our work on the ground.

Recently we held a breakfast in New York with our 2007 Acumen Fund Fellows who have just returned from eight months working with our investees in India, Pakistan, China, Tanzania and Kenya. As I listened to this incredibly gifted group of individuals, I was captivated by the sense of humility, passion and empathy they demonstrated when speaking about their work. For me, there were two key themes that emerged from the breakfast. The first was echoed in the words of Nadaa Taiyab who eloquently articulated the reality and the barriers to accessing the fortune at the base of the pyramid. Nadaa shared her story of scaling Medicine Shoppe’s operations through listening and learning from the poor as consumers, employees, and partners.  The second theme was best revealed in Keely Stevenson’s story of the tension she faced when helping A to Z Textile Mills discover the sustainable price point for an insecticide-treated bednet coupled with the reality of the tradeoffs that a woman living in rural Tanzania must face to protect her children from malaria. The provocative stories told by the Acumen Fellows revealed some of the greatest challenging we face in the world today and reaffirmed the importance of building a community of engaged and inspired problem solvers.

You can listen to an audio recording of the session, and we hope to post video soon! (The audio is a large MP3 file, so it may take a while to download.)