education

This cost analysis hangs on a wall at in the Osembe Primary School, a concrete block building surrounded by rice fields not far from Lake Victoria.

It was created by the members of the school Health Club, a group of precocious young kids I would love to see become interns in Acumen’s Nairobi office someday. It is not hard to imagine these kids making the leap from “Simple Mathematics” to Acumen’s BACO analysis.

Osembe is part of a multi-year study run by CARE and several other organizations to evaluate the impact of providing sanitation and clean water in schools. Schools like Osembe receive new pit latrines, storage containers and chlorine to purify their well water.

There is considerable evidence that clean water and good latrines in schools dramatically improve child health and school attendance (a factor of both reduced illness and better privacy: a large percentage of girls drop out when they hit puberty for the simple reason that they don’t have a private latrine to use for hygiene). And yet fewer than 30% of primary schools in Kenya have proper latrine facilities or access to clean water. If you had limited resources to spend on improving water access, schools would be a smart place to start.

The trick from Acumen’s perspective is that most of our investments rely on provision of goods and services to customers who can pay for them. But what about school children? The Osembe poster demonstrates a solid grasp of economics and an obvious appreciation for the service, but how can we expect kids to pay for clean water?

Let’s set aside the most obvious solution – government funding – which is how schools are funded in most of the world. In Kenya, the government provides each primary school $13 per student per year to cover all facilities, staff, books, and everything else. (Meanwhile a single member of parliament is paid about the same amount that the budget allocates to 40 primary schools.) Since the government is not stepping up, organizations like Acumen need to find other approaches to deliver these services to the 18,000 public primary schools in Kenya.

As our Nairobi office explores the water sector here for investments, we have seen several business models that can help expand water and sanitation access to schools. Here are two examples:

- Outside of Nairobi, several organizations have installed community water kiosks at schools, which provide the water free to students but charge a fee to the surrounding community. The fee is approximately 3.75 cents per 20 liter jerrycan, similar to the 3 to 6 cents that Acumen investees WaterHealth International and EPGL charge per 20 liter jerrycan in India, and affordable to low-income communities. Schools already have a built-in management structure to help run the kiosks, and the model and pricing can be tweaked so that the revenues cover operating costs of the system (and potentially capital expenditures too).

- A company called Manna Energy is building small community water treatment plants and toilet facilities in Rwanda and placing them at schools. The resources are provided free to the school and surrounding villagers, but the company is setting up a creative carbon finance scheme where they receive and sell carbon credits for offsetting firewood that would otherwise be burned to boil water.

Before we left the Osembe primary school, each of the visitors was called to introduce himself to the assembled kids, who were lined up in a big semi-circle marked by small bushes – the equivalent of the gym bleachers where we gather for morning assembly in the States.

“Good morning!” I said when it was my turn.

“Good morning teacher!” they chorused in the call-and-response fashion common here.

“I am visiting from America. Do you know who the president of America is?”

(Laughter) “Barack Obama!” These kids are from the Luo tribe, like Obama’s father, and he is a local hero. They know more about our President than most American kids do.

“I’m sorry President Obama couldn’t join us today, but I do know for a fact that he treats his drinking water just like you do.”

The kids laughed again, recognizing that this was a stretch. Our drinking water in the States is indeed chlorinated like the water in Osembe’s storage containers. But they know very well that our President doesn’t have to draw it from a well, carry the jerrycan to school, fill a big storage drum, and dose it with liquid chlorine himself.

It was encouraging to see the value these children place on clean water. But they, and millions of students like them, will only have access to it if we can find sustainable models to pay for that service in schools. Clean water and good health will help get these kids through school, into college, and hopefully someday applying their “Simple Mathematics” skills to Acumen investments.

I was in Pakistan for the first week of March, mostly spending time with the Acumen team and its close advisors. This time, unlike my last two trips, I stayed put in Karachi, where Acumen’s Pakistan office is based and did not get to Lahore (the city where the reprehensible attack on the Sri Lankan cricket team occurred on March 3rd) On two prior trips, I have visited Khuda-ki-Basti 4 (KKB-4), Acumen’s low cost housing investment near Lahore.

Although that development is still in a relatively early stage, there are 100 families living there today, a thriving primary school, a small general store and a secondary school in the works. KKB-4 is on the move. On my last trip in May I was happy to see the immense progress made in the few months since I had first visited. I could better imagine what it would be like when the housing plots were fully sold, the houses built, the shops and mosque opened—in short a real self-contained community.

On this trip, I was able to visit Khuda-ki-Basti 3 (KKB-3), a mature housing development outskirts of Karachi in which Acumen made a small investment several years back. KKB-3 (near Karachi) was the inspiration for KKB-4 (near Lahore) and are both brainchildren of Tasneem Siddiqui, the lead developer. I went with Shuaib Siddiqui (no relation), a Pakistani-American who has been working in our Karachi office for the last 18 months as a portfolio associate. Shuaib, along with Aun Rahman our Pakistan country leader, has become expert in the area of housing for the poor and is the relationship manager for our KKB-4 investment.

The drive to KKB-3 took about 45 minutes from Karachi center and when we arrived at the entrance, public buses plied the road. Other developments and commercial establishments crowded the area. Shuaib explained that, 8 years back when the development was just getting started, the area was a wasteland with virtually no roads or buildings.

We walked into the building which had originally been the sales office and now serves as a community center and management office. It was lined with photographs documenting the inception and progress of the development starting 8 years back. The original would-be buyers of land plots were required to live in temporary homes for two weeks before being accepted as buyers and members of the community. This procedure was designed to test their mettle as serious buyers and builders.

We then walked down the central artery of the development—I should say town because it is a teeming, vital town of 25,000. All of the plots have been sold and most have been built up with small single family homes. There is now a thriving secondary market in houses, as the improved land has shot up in value. Some of the poor laborers who were early buyers have sold at a substantial profit and have moved into a higher socio-economic class. Teachers and other professionals are starting to buy these houses and move in (real-estate prices in Karachi are sky-high and there is severely limited availability). And while most of the houses are very simple, a few have second and third floors and spectacular gardens.

We visited a primary school, one of 12 in the town; this one was built by The Citizens Foundation. The school was clean, open and attractive and requires a payment of a modest tuition fee. We visited briefly with the principal of the school who explained that because demand is so high, the school is run on a split session with half the students coming in the morning and half in the afternoon. Other primary schools in the town are even less expensive or free. When we visited later with the manager of the entire development, Akthar Sb, he explained that there is nearly 90% school attendance at the primary level—I had wondered aloud about this as there were many children walking about and playing during what seemed to me to be normal school hours. This was due to the split sessions, Akthar Sb explained.

However, the statistics for attendance at the secondary level drop off significantly, as many children in their early teens are expected to contribute to the family coffers. Given that school attendance is mandatory only until age 10, overcoming this attitude and getting parents to understand the value of secondary education is a long slow battle.

We visited a vocational school for older children and young adults, a clinic for women and children (which sold condoms on a prominently posted price list), a vet shop (mostly focused on goat care), a Catholic church, a vegetable farm, several small textile manufactures. We saw stores selling a vast variety of goods. We saw but did not visit several mosques. There are no banks are within KKB-3, but some can be found just outside in other developments which have sprung up close by.

In short an entire ecosystem has been formed out of empty land near a densely packed city with desperate housing shortage and an enormous population of poor residents. Those who have been able to make the leap now live in a community which provides access to their basic needs: clean water, power, sewage treatment, local government, education, health services and employment opportunities (1/3 of the residents of KKB-3 work within the town). Seeing possibility realized gave me hope and vision for our work at KKB-4, and a real sense of excitement for its future.

For readers out there who are looking to work with non-profits, GOOD Magazine is hiring for a role to manage their relationships with non-profit organizations.

GOOD magazine’s business model is to take all (yes, 100%) of its subscription revenues and donate it to a selected group of non-profits. (And yes, Acumen Fund is one of the non-profit partners; you can subscribe and chose Acumen Fund here).

GOOD magazine is all about celebrating and sharing innovative ways to change the world for good. More interesting still, GOOD is part magazine, part movement. For example, on September 23rd in New York they are having an event called “Mavericks of Education” featuring Wendy Kopp, Ninive Calegari, and John Wood. I’m sure it will be a great way to spend an evening. From GOOD’s website:

Frustrated by the current state of our education system? Come take part in the salon series goodebut of GOOD Conversations featuring a powerhouse line-up including Ninive Calegari, co-founder & CEO, 826 National, Wendy Kopp, founder & CEO, Teach for America and John Wood, founder & CEO, Room to Read. Join the conversation and learn how these mavericks worked inside and outside the system to make change happen.

To apply for the job, email Liza Vadnai (liza@goodinc.com) and to RSVP for the event, email conversations@goodinc.com with your name, email address, city and state.

This post first appeared at Sasha’s blog.