Posts Tagged ‘Social Enterprise’

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Acumen Fund @ University of Michigan – Leadership through Social Enterprise

Thursday, December 22nd, 2011

This fall, Acumen Fund partnered with the University of Michigan to teach a class on our work. All students in the course completed a leadership project focused on an issue of their choosing. One of the students, Gabby Park, chose to explore lack of access to healthcare with her project team.

I am one of 45 million Americans without health insurance today. Three summers ago, I was in a car accident that left me with a swelling bump on the back of my head. My church group was driving to visit a mosque when a huge van rear-ended us, sending contents from the trunk flying into the car, causing my head injury.

For close to three hours, I agonized over going to the ER to get treated.

And I began to think—how is this fair? How is it fair that millions of Americans and billions around the world have to make this same choice every day, often in potentially life or death situations?

After this experience, a passion alighted within me and I realized my purpose: to better understand the healthcare system and what I could do to change it. I saw social enterprise as one route to bringing innovative, community-focused ideas to an ailing, flawed system in need of greater reform.

But I had never seriously thought of myself as a social entrepreneur until signing up for the Acumen Fund class at the University of Michigan’s Center for Entrepreneurship on leading innovation through social enterprise.

Upon enrolling, I was filled with doubt: Will I learn anything?  As a leader in several student organizations and an active member in church, I felt I knew how to work in groups to achieve goals.  What would this class contribute to my knowledge that my experience had not already taught me?

Well… it turns out, a lot.

In addition to the in-class content on leadership, patient capital, and social enterprise, we also applied lessons learned in the classroom to a leadership project. The leadership project pushed us to interact with our community and taught us to put people at the center of any idea or design.  This is how my team decided to focus on lack of access to healthcare. We spoke with many different people, from the uninsured to those who had always taken insurance for granted, and learned that one of the biggest barriers to healthcare access in the U.S. is lack of knowledge.

After listening to public health professionals who spoke of the need for a comprehensive information center and reflecting on our personal experiences, my team decided to design a comprehensive call center the Ann Arbor/Ypsilanti area.  Anyone could call the center at any hour with questions ranging from where to find the nearest urgent care center or affordable clinics for the uninsured to health insurance policy questions.

We are now looking at how we would want to structure this organization—would it be for profit, a non-profit or a hybrid?  Focusing on funding is critical as well, and we are envisioning how patient capital could contribute to its initial development and long-term sustainability.  In addition, we are exploring how we can possibly measure its overall impact.  Our vision is to have a successful call center that has wide reach and is consistently used by the public.

If there is one thing I have learned from this class, over and over and over again, it is that people have so much to give– if we only ask.

I learned just how passionate I am about my calling, too.  And I learned how difficult it will be in the future to convince people that this issue is worthy, that it is just, and that it is in need of changing.

I may not be certain of what my future holds, but my vision is to be part of an organization that is able to provide the affordable, quality, and equal access to healthcare that I believe this country can and should provide.   This class has shown me that as long as I’m willing walk the long journey to affecting change and build systems that focus on sustainability, then, I, too, can be a social entrepreneur.

Gabby Park is a senior at the University of Michigan.

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My toothbrush was good enough

Monday, May 23rd, 2011

My toothbrush was good enough.  In fact, it had been good enough for a while.  I didn’t need the Colgate 360 toothbrush, and I doubt you did either.

Admittedly, it’s an impressive toothbrush.  Look at all the features packed into this baby: a tongue and cheek cleaner, multi-function bristles, polishing cups, a raised cleaning tip to “tackle those hard-to-reach places at the back of your mouth,” and (of course) those handy-dandy “raised rubber grips for better grip, and wide thumb grips for better control.”

I’ve got nothing against good oral hygiene.  Please brush and floss daily, with whatever toothbrush works for you.

My point is that it’s obvious that we are WAY down the curve of declining marginal benefits for innovation on the toothbrush as a product.  Do we need a no-slip handle with gel and little knobby bits?  No. I don’t think toothbrushes were flying across bathrooms across America, causing anger and frustration for millions, and leaving mouths full of unsanitary plaque and gingivitis.

Even if the handy-dandy Colgate 360 is demonstrably better than the straight-handled, one-type-of-bristle toothbrush I got for free from the dentist in the 70s, you’ve gotta believe that we are, today, somewhere near the pinnacle of how much better the manual toothbrush can get.

Yet the world is set up so that it makes good sense to keep on tricking out our toothbrushes.  On the back of the 360, Colgate’s share of the toothbrush market has jumped from 28% to 36% in the last two years.  The better brush is paying off for them, for now.

But what will the next 50 years bring?  How much better can our toothbrushes get?  We’re hitting a wall in terms of improvements here, yet that won’t stop armies of our best and brightest from fighting over toothbrush market share for the next few decades and beyond.

So the question becomes: how do we shift the frameworks and the incentives so that more of our massive ability to innovate gets applied to things that – we can all agree – matter more and are harder to tackle?    Because I for one am betting on the power of innovation, much more than more money, as the greatest lever in accelerating the fight on poverty and social exclusion.  Yes, the rise of social enterprise, the entry of the Gates Foundation on the scene, more progressive philanthropy and the overall improvement in the quality of analysis and thinking in our space are all encouraging, but we’re still getting lapped by the toothbrush-makers, the razor-blade improvers, and the folks rolling out ever-more-clever financial products.

So when I’m asked whether I think the social enterprise space has gotten too “hot” for its own good and whether there are too many people chasing too few jobs, I think nothing of the sort.  My hope is that we’re at the beginning of a generation-long trend in which our best and brightest feel a sense of calling, of responsibility, and of service that will fundamentally transform our labor force, how we live our values, and, ultimately, the societies we build here and around the globe.

A big piece of this will be a shift in incentives, in what we value, and in who we hold up as heroes.  The faster we can make this shift, the better, because I for one am not looking forward to the inevitable wunder-razor that no doubt will dominate supermarket shelves in 2050 (thanks Russell!!):

Sasha Dichter is Director of Business Development at Acumen Fund. This post originally appeared on his personal blog – check it out here.

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A New Movement: From Divergence to Convergence?

Monday, March 28th, 2011

A few days ago a friend of mine, Sonny Garg, asked me “is this movement (social entrepreneurship) really any bigger or different than any other social justice movement we have seen? And if so, why?” After giving it more thought, my answer in short, was “yes.” Below are some of the ideas that came out of our dialogue and we would be very interested in your thoughts and reflections.

Any Larger?

The first argument for this movement being larger is the concept of “extended community.” Sonny said, “Perhaps what we are seeing is not so much an increase in a commitment to social change but rather a broadening amongst young people (and society generally) of their definition of community, hence expanding the pie.” From my perspective, I observe this happening from three main sources.

The first is the rise of social media. Just last week I was at the Women in the World conference and met an incredible entrepreneur from Uganda whom I had been following on Twitter. While I had never met her before when we “met” at the conference it was as if she and I were old friends. Even before we met in person, we felt connected, a part of the same community. Facebook, Twitter, Community sites, Kiva (which just announced it has reached $200 million in loans), they all can have the same impact.

The second is the increase in international study and travel programs like Global Citizen Year, School for International Training, Atlas Corps – all which allow people to see social inequality face to face rather than on an infomercial. Living abroad changes lives, redefines stereotypes, challenges assumptions, humbles you, and most importantly expands your community.

The third is the democratization of knowledge. Knowledge used to be owned by the elite but that is changing and the voices of the marginalized are becoming louder. Take for example TEDx, the Arab uprisings, Grameen Phone, which have not only disseminated knowledge to the poor but more importantly allowed the poor to share their voice on a global stage (Watch this TED talk by Chris Anderson if you don’t believe me).

Because of this extended community, I do believe this movement is bigger and perhaps we can show the world what global inclusivity truly means.

Any Different?

The second part of the question was, is this movement any different than any other social justice movement we have seen?

I do think this movement is different. This movement is more about convergence than divergence. For example the Civil Rights Movement was about divergence from the mainstream while this movement is about convergence of a social agenda into mainstream thinking and in particular business practices. I am not saying one is better than the other, they are just different.  I believe deeply in the importance of divergence to create social change (We spend a lot of time understanding these movements in the Fellows Training).  We will always need dissidents to speak truth to power and show that it is time to diverge from an old oppressive system (Havel, King, the recent Arab uprisings are all examples of this).

But the social entrepreneurship movement is doing is something different.

We are seeing an emerging group of system changers that are pushing us to think beyond the traditional silos that force us to make a black and white decision, “Is this business or charity?” These system changers are starting to experiment with integrating their social change passion with their private sector professions and vice versa.

Take for example 2009 Acumen Global Fellow Heidi Krauel. Heidi is one of the most astute business women I have ever met. Heidi has chosen to build a career that straddles both business and social change, she is the COO of New Island Capital, a social investment fund that deploys patient capital – at scale — to generate risk-adjusted financial returns. What people like Heidi are doing is validating for the rest of us that you do not have to make a choice between business or social, in fact you can find a way to do both. While it is not easy and it does involve sacrifice, this is an inclusive movement for everyone – not just the dissidents among us.

When it comes to our leadership vision at Acumen Fund, we do believe in the idea of convergence.  We want to extend our community and create role models (through our team, the Global Fellows Program, and now the East Africa Fellows Program) who can transcend boundaries and have the operational and financial skill sets combined with the moral imagination to build a more inclusive society and social system. If we can make social impact a board room topic (see Michael Porter’s recent article on “Shared Value”) and make financial sustainability, transparency, and accountability a part of the grassroots discussions then perhaps we can break down barriers that keep us so divided (and have prevented social movements from being as pervasive as they could be).

So, in short – Yes, I do think this movement is different and more pervasive. Do you?

Blair Miller runs the Acumen Fund Global Fellows Program. Follow her on Twitter at @AcuBlair.

Photo: Flickr Creative Commons, user jennalanger.

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Five Market Imperfections Facing the Bottom of the Pyramid

Thursday, March 24th, 2011

In a recent speech, author Jonathan C. Lewis noted five critical differences between economics-textbook market conditions and real-world market imperfections faced by the poor:

1. In functioning markets, capital flows to its highest and best use. Risk and reward is measured to the single basis point

  • Where the poor live, capital is rare and expensive. Indeed, microfinance was invented because mainstream banks, historically and enthusiastically, had ignored the working poor.

2. In functioning markets, prices are set between willing buyers and willing sellers. Competition brings down prices, improves products and extends markets.

  • Where the poor live, scarcity and monopoly live side-by-side. The poor are captive consumers subject to predatory pricing.

3. In functioning markets, consumer protection and financial transparency are enforced by governmental policy and a court of law.

  • Where the poor live, property rights depend upon social norms or brute force.  The poor are powerless.

4. In functioning markets, a distinction is made between public and private goods, between street cleaners and vacuum cleaners.

  • Where the poor live, private investment is often the only investment. The market, quite literally, becomes the sole provider of the common good.

5. In functioning markets, survival of the economic fittest is a necessary consequence of progress. Some businesses succeed, some fail.

  • Where the poor live, the only ethical economic policy is not creative destruction, but creative opportunity.

This is not to say that all is lost; quite the contrary.  Acumen Fund supports entrepreneurs whose missions – and companies – see these market imperfections not as the unfortunate reality.  We look to this list and instead, see opportunity for business success and obligation to serve the poor side by side.

For those interested in the challenges of BoP markets and opportunities for innovation, we recommend reading the whole of Jonathan Lewis’ speech.

Rob Katz is a Portfolio Manager at Acumen Fund.

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Listening to the Voices of Experience

Thursday, March 3rd, 2011

Last month I traveled to India, Pakistan, and Kenya to recruit the Class of 2012 Acumen Fund Global Fellows and had the opportunity to spend time with the current Acumen Fellows, Fellows Alumni, and future Fellows.  These moments and these individuals reminded me that this movement is asking us so much more of ourselves and of our world.

We, at Acumen Fund, created the Global Fellows Program because we wanted to build a core group of leaders from across the globe who not only had the intellect, passion, and business skills but also the experience of what it was like to serve low income consumers in some of the most challenging environments in the world.  Last month I got a glimpse into that complexity.

In Pakistan I found myself in a small, dark, bustling back alley on the outskirts of Lahore with, Fellow Benje Williams and his colleague from Pharmagen, Shakeel Awan.  Benje, Shakeel, and I exchanged a smile as a group of men in their spotless white kurtas sitting nearby got a good look at the Americans.  While there, Shakeel showed me how Pharmagen was able to clean their water with reverse osmosis treatment in the back of the store before selling it to customers, while Benje raved about the new marketing plan they had developed to reach more low income consumers.  The plan was built from months of customer surveys and a trip to India where Benje met with Fellow Brenda Williams who shared best practices from Water Heath International, an Acumen investee that builds community water systems in rural India.

Just two days before my visit to Pharmagen a 12 year old boy took his life in a suicide bombing near one of the Pharmagen shops.   Yes, life can hand out fear and hope in one single breath.  The leaders of our time must handle this complexity both in its beauty and in its sadness.  Benje and the Pharmagen team are handling this with grace.

In Mumbai, as I sat waiting for Acumen Fellow, Chikako Fujita, along the face of the Arabian Sea I watched the bustling road filled with honking rickshaws as hundreds of men gathered in ankle deep in water to relieve themselves and take their morning shower.  The injustice enveloped me like a cloud of diesel smoke. Chika arrived late and exhausted.  Chika has been asked to design the standard operating procedures for 1298, the first private ambulance company in India, as they scale up across the country.  Chika, with a solid background in business from PriceWaterhouseCoopers and Sanyo in Japan, must take that learning and apply it to a growing social enterprise, who through government contracts, is now seeking to scale their ambulance fleet from 326 to 1000 by 2012. I think Chika found a breath last week, I hope.

In Nairobi, I sat in a hot, dusty, diesel-filled, traffic-packed, 10 mile ride (which took us 1.5 hours!) with Khuram Hussain on our way to meet with the team from Goldman Sach’s 10,000 Women (an incredible program committed to providing 10,000 underserved women business and management education).  Khuram is currently a Fellow at Ecotact a company working to provide affordable yet high-quality sanitation services to low-income communities in Kenya. I listened as Khuram discussed his new role building the strategy for the Ecotact mobile toilet program for high end consumers in Nairobi.

Khuram did not anticipate that serving the poor would involve spending so much time serving the wealthy.  “What about building more Ikotoilets in the slums of Nairobi,” he asked?  Khuram is coming to terms with the reality sometimes building a business at the base of the pyramid is about tradeoffs and often involves subsidization.  This can be a complex, daily balancing act for a social enterprise: make money, create social impact, create social impact, make money.  Every day, every minute, they live that tension.

Using the market for social development has a depth of complexity that cannot be found in the classrooms of the top business schools or one week field visits to the slums.  It takes deep learning from courageous people who are willing to live lives of immersion.  While I realize we will all not be able to, nor should we, live lives of immersion, it reinforces the need to create more space for those voices of authentic experience in an increasingly noisy field.

Blair Miller runs the Acumen Fund Fellows Program. Follow her on Twitter at @AcuBlair.

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