Written with David Lehr and John Paul

A while back, I posted my impressions of being a mobile consumer in East Africa, ranging from interactions with the woman who cleans my apartment to the varied uses of mobile telephony Acumen Fund sees among its portfolio companies. Things have evolved. Since then, my landlord fired her and the replacement cleaner, settling on a dynamic young woman named Juddy. She too communicates through mobiles, except in those instances where she runs out of prepaid phone credits and we resort to old-style human contact. My own account has been migrated to “postpaid,” meaning I receive a (outrageously high) bill at the end of the month instead of buying the prepaid credit that accounts for the majority of mobile usage here. Meanwhile, across the country, SMS short codes are becoming ubiquitous for radio show call-ins, university and government programs, health data collection and more, as mobile phones solidify their position as the connectivity platform of choice for the world’s majority.

Acumen Fund’s thinking on the potential for mobile phone applications in the developing world has moved forward as well. I finished the Nick Sullivan book — You Can Hear Me Now — that sketches out the birth of the Village Phone business in the late 90s. The original model allowed entrepreneurs in Bangladesh, primarily women, to buy $420 phones with microcredit loans and then pay them off over time with revenues from selling calls at a markup. To Sullivan, two keys to that model’s success were the smart foreign capital coming into the sector and the dynamic local talent willing to take entrepreneurial risk in order to make something happen. Today, as the cost of phones drops steadily, many are betting on value-added services on mobiles as the next boom. I have seen three aspiring business plans along such lines in the past month alone. Mobile applications are inherently scalable since they are automated, available over a wide area, and there is virtually zero cost to add customers. And a la Sullivan, enterprising service providers are going way beyond ringtones and games to test these enterprise applications in developing countries.

Our Business Technology Solutions Team is studying the ongoing innovations in the mobile application space, particularly in the social enterprise arena, to analyze potential benefits to Acumen Fund’s low-income target market and the businesses that serve it. (more…)

One of my toughest days working in this field was recently, when we went to the Mukuru slums to visit one of the sites operated by a business we are considering funding. I’ve been in some of the poorest places in the world – in places far afield as Peru, Pakistan, Honduras, India, South Africa, Brazil and beyond. But I don’t ever recall being as disheartened as during my visit here.

Perhaps my discomfort was brought about by the subject matter at hand. See, the business in question, along with a few others we are looking at, is trying to improve the conditions of sanitation facilities (read: bathrooms) available to the residents of these areas. We take our tiled, marble loos for granted in the West, thinking more about which fixture would go best with our new mirror.

But here, it’s a different story. Among the 300,000 – 500,000 (it fluctuates) residents of Mukuru, few if any have their own facilities. Imagine that, no place or privacy to perform bodily functions that everyone is obligated to deal with daily. This inevitably leads to very unpleasant and unsatisfactory conditions all around, a host of diseases and infections, and an unsafe river nearby. Related is the phenomenon of “flying toilets,” where waste is disposed of in plastic bags and hurled away from the house, a common practice after dark, when leaving one’s home in these parts can be quite dangerous. (more…)