Reaching the Last Mile Innovative Business Models for Inclusive Development Public Disclosure Authorized Editors Elaine Tinsley and Natalia Agapitova
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Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Reaching the Last Mile Innovative Business Models for Inclusive Development Public Disclosure Authorized Editors Elaine Tinsley and Natalia Agapitova Reaching the Last Mile Social Enterprise Business Models for Inclusive Development Editors Elaine Tinsley and Natalia Agapitova © Copyright March 2018 The World Bank 1818 H Street, NW Washington, D.C. 20433 All rights reserved Photos: cover-bottom middle (Anvar Ilyasov/World Bank); p. 4, cover-top middle (AishaFaquir/ World Bank); p. 17 (egwestcentre.com); p. 32 (Text2Teach); p. 34, cover-bottom left (Jonathan Ernst/World Bank); p. 70 (ABBAS Farzami-Runi Consultancy/World Bank); p. 71 (Huong Lan Vu/World Bank); p. 86 (Trevor Samson/World Bank); p. 87 (Merck for Mothers); p. 100 (Arogya Triage@Home); p. 103, 182 (Living Goods); p. 121 (thebetterindia.com); p. 134 (LV Prasad Eye Institute); p. 137 (salaUno); p. 148 (Dominic Chavez/World Bank); p. 149 (AFRIpads); p. 163 (Jayashree Industries); p. 167 (Elmvh/Wikimedia Commons); p. 185 (ABN AMRO); p. 188 (Dana Smillie/World Bank); p. 189 (www.thinkindia.net.in); p. 200 (Mobisol); p. 204 (Onergy India); p. 217 (Devergy); p. 222, cover-top left (Graham Crouch/ World Bank); p. 223 (Allison Kweseli/World Bank); pp. 225, 238 (Ghana Wash Project); pp. 235, 265 (Safe Water Network India); p. 240, cover-bottom right (Curt Carnemark/ World Bank); pp. 241, 255 (Sanergy); p. 252 (Clean Team Ghana); p. 258 (Fresh Life); p. 259 (Almin Zrno/World Bank); p. 261 (WeCyclers); p. 286 (Farhana Asnap/World Bank); p. 287 (Simgas); p. 314 (Peter Kapuscinski/World Bank); p. 315 (Danillo Pinzon/World Bank); p. 341 (Joåo dos Santos/World Bank); pp. 343, 286, cover-top right (Simone D. McCourtie/ World Bank); pp. 353, 406 (Arne Hoel/World Bank); p. 377 (www.inclusivebusinesshub.org); p. 388 (A'Melody Lee/World Bank); p. 389, 426 (Solar Now); pp. 407, 424 (M-Pesa); p. 427 (Rashtriya Swasthya Bima Yojana) Contents Foreword . vii Acknowledgments . ix Introduction . xi Abbreviations and Acronyms . xiii SECTORAL BUSINESS MODELS: EDUCATION . 3 Providing Low-Cost Private Schooling to the Poor . 5 Profile: LEAP Science and Maths Schools . 15 Profile: Omega Schools . 17 Improving Learning Outcomes by Bringing Innovation to the Classroom ..........19 Profile: STIR Education . 29 Profile: BridgeIT . 31 Evaluating Schools and Helping School Management Improve Education .........35 Profile: Gray Matters India . 47 Profile: Link Community Development International . 49 Expanding Access to Employment and Higher Education Opportunities through Rapid IT Skilling ....................................................51 Profile: Digital Divide Data (DDD) . 64 Profile: Invincible Outsourcing/Maharishi Insitute . 67 Making Tertiary Education Possible for Low-Income Students. 71 Profile: Lumni . 80 Profile: FINAE . 83 iii Reaching the Last Mile: Social Enterprise Business Models for Inclusive Development SECTORAL BUSINESS MODELS: HEALTH . 85 Reaching the Poor through Community Health Workers. 87 Profile: Sustainable Innovations/Arogya . 98 Profile: Living Goods . 101 Using Telemedicine to Treat Patients in Underserved Areas .....................105 Profile: Telemedicine Africa . 116 Profile: Narayana Hospital . 118 Serving the Healthcare Needs of the Poor with Specialized Clinics ...............121 Profile: LV Prasad Eye Institute . 133 Profile: salaUno . 136 Ambulatory Services for the Last Mile. 139 Changing the Lives of Women and Girls through Affordable Feminine Hygiene Products .........................................................149 Profile: Jayashree Industries . 162 Profile: Technology for Tomorrow Limited . 165 Using Mobile Technology Tools to Provide Quality Low-Cost Health Services .....167 Profile: MeraDoctor . 181 Profile: Text to Change . 184 SECTORAL BUSINESS MODELS: ENERGY . 187 Bringing Solar Home Systems to Off-Grid Communities . 189 Profile: Mobisol . 199 Profile: ONergy India . 202 Electrifying Rural and Remote Areas through Mini-Grids ........................205 Profile: Devergy . 216 Profile: DESI Power . 219 SECTORAL BUSINESS MODELS: WATER & SANITATION . 223 Bringing Clean, Affordable Water to Poor Communities Through Decentralized Water Treatment Kiosks ....................................................225 Profile: Safe Water Network Indial . 234 Profile: WaterHealth . 237 Meeting the Sanitation Needs of the Poor with Serviced Toilets. 241 Profile: Clean Team Ghana . 251 Profile: Sanergy . 254 iv SECTORAL BUSINESS MODELS: WASTE . 259 Collecting Waste in Low-Income Areas. 261 Profile: TakaTaka Solutions . 279 Profile: Wecyclers . 283 Converting Waste to Energy .................................................287 Profile: Sustainable Green Fuel Enterprise (SGFE) . 306 Profile: SimGas Kenya Ltd . 310 Providing Decentralized Wastewater Treatment . 315 Profile: Agua Inc Global Development Group . 333 Profile: Wetlands Work! . 337 STRATEGIES TO REACH THE POOR . 341 Creating Consumer Awareness for Products or Services . 343 Managing Last-Mile Distribution to Low-Income Consumers ....................353 Making Products and Services Affordable for Low-Income Consumers ...........365 Using Information Communication Technology as an Enabler ...................377 SCALING IMPACT . 387 Gathering and Using Evidence to Scale Inclusive Business Models ...............389 Role of Governments and Public Policy in Advancing Inclusive Service Delivery Models ...................................................407 Case Study: Providing Banking to the Unbanked in Kenya through Mobile Phones . 424 Case Study: Offering Incentives for Re-energizing Low-income Groups . 426 Case Study: Providing a Nationwide Health Insurance Scheme for the BoP in India . 427 v vi Foreword Johannes Linn Bringing essential services to the poor, whether in remote rural areas, provincial towns, or in the slums of megacities, is a great challenge for governments in developing countries. Lack of governmental capacity and fiscal resources at the national and local levels prevents effective public provision of water, power, education, and health services to the poor. And private firms, which often step in to serve the middle and upper classes, are dissuaded by high risks and low affordability from providing these services to the poor, or what is some- times referred to as “the last mile.” In contrast, social enterprises have been able to provide basic goods and services to the poor. The distinctive feature of social enterprises is that social impact is their raison d’etre, rather than maximizing profit. This allows them to test innovative solutions and experiment with new techniques and approaches, while responding to the needs of the communities in which they are imbedded and treating them as empowered customers rather than beneficia- ries of public or private largesse. The engagement of social enterprises provides important les- sons on how to reach the poor—how to make them aware of problems and solutions, design- ing products that address their needs, and making these products available and affordable. While specific examples of successful social entrepreneurship in social service provision have been written, no systematic assessment of their engagement has been available until now. This is the gap that the present book aims to fill. It catalogues over 40 of the most effective market-based solutions for service delivery to the poor brought about by social enterprises. It tracks how stylized business models have been developed to address develop- ment challenges. The sectors covered are education, energy, health, waste, water, sanitation, and finance. The book’s analysis employs and greatly benefits from systematically applying a common framework that helps explain the relevance and implementation of the model for even general development practitioners. vii Reaching the Last Mile: Social Enterprise Business Models for Inclusive Development While the case studies are an essential ingredient to understanding the role social enterprises play in service delivery to the last mile, the book also adds a valuable cross- cutting perspective with lessons for how to frame strategies to reach the poor, such as enhancing consumer awareness, assuring effective distribution, improving affordability, and using ICT. And, perhaps most importantly, the volume closes with a section on how to scale up the impact of social enterprises in service provision to the last mile, including effectively measuring results, pursuing replication with adaption, and ensuring a supportive role of government and public policy. Indeed, the book concludes that scaling innovation solutions for reaching the last mile depends on mutual trust and effective collaboration between social enterprises and the government. Anyone interested in market-based solutions that serve the interests of the poor will find this book of great relevance to their work, whether they are social entrepreneurs and their funders and supporters, development practitioners, or governmental policy makers and administrators. The rich evidence and sound analysis they find here will help them grasp the opportunities and meet the challenges they face in reaching the poor with essential social services—and thus successfully traversing “the last mile.” Johannes F. Linn The Brookings Institution Washington, DC viii Acknowledgments This book was prepared by Elaine Tinsley and Natalia Agapitova as part of the World Bank’s Social Enterprise Innovations program to explore the experiences of social