When? April 10, 2010; 7-11pm
Where? April Rinne's home in San Francisco
Who? 15 people!: Mike Lin, Michael Macharg, Jacob Winiecki, Kjerstin Erickson, Joanne Greenstein, Katie Drasser, Stephanie Cohn, Jubran Kanaan, Deb Meisel, Ross Evans, Nathan Wyeth, Shannon Whitnack, Colleen Cotter, Jerry Michalski, April Rinne
Topics: Local Country Entry Strategy; Fieldwork
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First, a couple of updates:
- Ross shared his concept of “holy shifts” and we discussed how to potentially market it;
- Deb and Nathan mentioned a conference they are helping to host this week in SF for Chinese entrepreneurs; and
- Mike Lin took us into a discussion of the recent NY Times article highlighting the new Eureka Fund and featuring his own social enterprise, Fenix International!
Summary of discussion: Eureka Fund and other interesting Kiva-like groups are popping up to channel funding to projects, companies, etc. Jason Bluesmith, a science focused researcher, realized that it’s hard to get projects that are off the beaten path funded – and ultimately wasn’t getting done because there wasn’t funding available. Looking at the Kiva model, he thought that there could be a way to get the community as a whole more engaged in science.
Eureka Fund has a scientific advisory board that reviews applications and then deems that they are academically rigorous, and leave it up to the people to fund it or not. Fenix is the first project to win funding because they are going to do research into how people use car batteries to solve their energy issues and to understand the nuances of the problem. Eureka is interested in soliciting more projects, even government related, policy, water, etc. could be investigated in that way via a science lens. Mike Lin and Fenix got covered in NYT in relation to Eureka Fund – and offered to make intros to Eureka and similar groups.
- Fenix is a smart generator and a smart battery – just concluded a pilot of 20 units in Uganda, hope to offer the product at $20;
- Afrigadget was suggested as a platform to look at
- Mike began a discussion of the size of phone charging market in developing countries. It costs about 0.25 cents to recharge your cell phone in Uganda
Then we moved to the “core” topics of local country entry strategy and fieldwork:
How do you decide what country to go into?
Mike Lin decided to start in Uganda mainly because of the vibrant cell phone network; lots of cell phone subscribers and carriers; Uganda is very entrepreneurial in general; history-wise, it is also easier because they speak English; favorable tax code for renewable technologies – currently only if they are bundled with solar.
April shared her experiences with Water.org, which has a very robust, comprehensive territorial assessment process. They look at a wide variety of factors including political risk, entrepreneurial sector, ease of getting money in and out, approach/perspective of government, etc. Each of these factors is assessed and weighted, resulting in a numerical score for countries. Even if you don’t end up going into a country, it’s worthwhile to do that kind of assessment because it is valuable for the future and for cross-country comparative purposes. It also often matters whether you already have pre-existing contacts or potential partners in-country.
Mike M. asked whether anybody has experience taking the design, product development, manufacturing, etc. and doing that overseas. His team is looking at doing product design and development overseas, but how do you manage that remotely as a small team?
World Bike (Ross) shared that, in his experience, indigenous was the best initial focus, but after this effort we decided it’s not the right thing to do in Africa. Having someone reputable and working with an agent to select suppliers was important. "Paying a bit more is worth it if you have the right combo of reliability and trust. But that said, it’s becoming easier and easier to have people to do it remotely. Present a supplier with a business plan because they might be willing to put in money themselves."
Alibaba.com is also a great resource for finding out how much things cost to be produced.
April shared that "When you’re looking at manufacturing especially, doing a due diligence trip to find out who is doing what and what kind of factories are there is hugely important. Over time, there has to be a transfer of knowledge to the local markets so people can take it apart, put it together, etc. In the water space, often you don’t find companies with some real production capacity locally. It would require a larger amount of funding to find this locally. Generally speaking, more local production opportunities appear to be possible in India than in Africa."
Peter Frykman (his company Driptech, low-cost high-efficiency drip irrigation technology) was mentioned for having tackled local supply and distribution chain issues. From a supply and distribution and production standpoint, they seem to have successfully navigated this space in China and India. They have been able to find local producers, local suppliers, etc. in the last few years. Peter is based in the Bay Area, but most of their other activities are in country.
D.light has also done this successfully – everyone is in India or china.
Generally speaking, if you have a local partner and a local entity, you can get things done much more quickly than if you are considered an international entity. Finally, India is known as the hardest places to work from a financial side, but from an operational side it can be fairly easy to incorporate (so long as you have locals who can represent the organization).
Then Mike M. mentioned that "The most important reason why we decided to locate in SF was the ability to iterate quickly and to attract the caliber of talent locally. Travel is very large and significant and we know that are having a big carbon impact, but at the end of the day it is far more effective to do our engineering here." April noted that whether you can tap into local funding sources and/or ease of hiring local talent can also play a role. Often only “local” organizations can fundraise domestically, so it can be valuable to incorporate locally to take advantage of such opportunities. This may have impacts on your HQ and tax status however, to best to do a thorough analysis of pros and cons first.
Then we stopped for round 2 of dessert, SF views, catching up and the evening finished quite late!
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