Affordable healthcare for the masses: Ilara Health’s sustainable business model saves lives


This week we’re featuring what has to be one of my favourite business models to date.

One of the dominant themes in East Africa is that individuals and businesses don’t have the cash to afford products and services that would earn them more money, and make their lives better.

To open up access to electricity, off-grid solar power systems are now commonplace, provided on a Pay As You Go basis.

This model is being adopted in other markets too, such as cooking fuel, irrigation pumps and TVs.

Where it becomes especially powerful is, in my opinion, if the financing can be for a revenue-generating asset.

The new owner gets a top of the range piece of kit and is able to pay for it through the additional income they earn from it.

This is what Ilara Health has done for medical diagnostics.

Ilara Health takes the most advanced, modern equipment (often smartphone-based) that offer the same results and cost only a few thousand dollars, and then provide them to peri-urban medical clinics in Kenya who then pay back in installments.

The result – routine ultrasound tests become available to a local population at an affordable rate, (rather than spending hours to travel to have one), medical clinics can grow their business, and Ilara Health has a sustainable business model.

Emilian also has a number of top tips on starting any business in Africa which come from over 20 years of him running and investing in companies on the continent.

I’d strongly recommend following him if you’re interested in building ventures in the region.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!


Social Media Links



Twitter: @HealthIlara



Sam:                                      00:07                     Cool. So we’re here today with Emilian from Ilara health, Emilian welcome to the show.

Emilian:                                03:44                     Thank you.

Sam:                                      03:45                     So to get started, can you tell us a bit about you and a bit about Ilara health?

Emilian:                                03:48                     Sure. So I’m Emilian, I’m the CEO and co founder of Ilara health. And we make diagnostics more affordable, accessible and accurate in Africa. I’m an entrepreneur, but also an investor. I spent the past four years building and, and growing growth stage technology enabled venture capital firm focused on Africa, mainly in between South Africa, Kenya, Nigeria and Egypt. Prior to that I used to run rocket internet, the parent company with Jumia in a couple of markets, between China Russia, India, South Africa, and later in Nigeria built one venture with not for us funding in South Africa and run Groupon, South Africa for a year.

Sam:                                      04:46                     Got it. Cool. And when did you start Ilara health?

Emilian:                                04:50                     So we started, Ilara health is a result of over a year, actually year and a half of market research around how to build a sustainable healthcare venture in Africa and emerging markets. We’ve launched commercially in March this year. Well, I spent half of my time last year researching the primary healthcare sector in multiple markets in Africa as well as India and Latin America to find the right business model to build here.

Sam:                                      05:28                     Got it. And if I’m right, you’ve settled on lease financing for a diagnostic test, is that…

Emilian:                                05:37                     Yeah, so, I mean, starting with a problem so 70% of of medical decisions require diagnostics such as blood tests and, but there are half a billion you know, 500 million people in Africa, who struggled to access or afford a simple blood test. So I’ve, you know, as I mentioned to you over over a year, I visited hundreds and hundreds of health clinics across the continent and it’s shockingly poor. So I remember even meeting this lady in one of the clinics, and she actually lost her child from pregnancy complications because she just couldn’t afford an ultrasound before birth. But, but thanks to advances in artificial intelligence, robotics, technology there are companies around the world which create new diagnostic devices, which are much smaller, lower cost and can work directly at the point of care in the doctor’s office providing results in minutes. So at Ilara health we do four things, to get back to your question, so we partnered with those companies and we integrate their devices into our technology platform. Number two, we distribute this bundle of devices into the petty urban and rural clinics where 70% of the patients live. So we’re not in Nairobi itself, but we’re outside the main city in the suburbs. We also offer financing, which is very important because those doctors cannot afford to buy even a much cheaper and smaller diagnostic device upfront. Number three, we charge the doctors an affordable subscription or, or paper test as they use the equipment and we continue helping those doctors growing their revenue by providing new diagnostics devices and new services.

Sam:                                      07:35                     Got it. Okay so you sort of said you were always interested in health care is that it seems like if you went and did it, spent a year going through lots of clinics. That was your kind of…

Emilian:                                07:45                     Exactly. So I’m, I’m super proud, actually, I’m very passionate about health care for myself and it’s been a while. I’m very into prevention and early detection of diseases. I go every six months to see a doctor in Cape town and I do 20, 30 blood tests, you know, to just to…

Sam:                                      08:06                     What’s a 20, 30 blood tests.

Emilian:                                08:08                     So anywhere between the, you know, starting with the basic ones, between all the biochemistry the lipid function, no cholesterol up to more complex tests tumor markers hormones, just to make sure that, you know, if anything goes wrong, I can detect it and I can do something about it. And these communities with you know, with a reasonably healthy lifestyle, you know, doing lots of sports, eating very healthy, sleeping, you know seven, eight hours a night. So that’s my goal. My goal is to make sure that I can, you know, I can live healthy and you know, hopefully longer. So longevity is one of the things I’m looking into. However, in Africa we’re actually not talking about longevity, we’re talking about survival in those regions. So I’ve been looking for a while how to apply my interest in healthcare into a business, a sustainable business model, tackling the basic needs that a patient, you know, sub in, you know, in suburban area in around the main cities in Africa would need and people, you know, during those hundreds clinics, we, you know, one of the first questions that we ask doctors is why, what are the main reasons someone comes to see you? And there are four, five reasons people come with upper or lower respiratory infections and ideally they would need a full hemogram to make sure to, to identify if those infections are viral or bacterial. So to see if they they take antibiotics or not then there are just the infections they will need a stool test. Then urinary tract infections they need a urine test. Then a high percentage of people here are pre-diabetes, pre-diabetes or diabetes. Some are, two thirds don’t even know same for cardiac diseases. And they would need, for diabetes, they will need, not the glucose because glucose, a basic glucose test can not identify, but rather, you know, the spikes can, can obviously influence the test. But you need an HBA one C test, which is a bit more complex, which is on average over three months of your blood sugar same for cardiac diseases, You need the cholesterol, you need the lipid function test and the other reason is pregnancy. We may need one to two, well it’s recommended that they get one to two ultrasounds before pregnancy, and the problem again those tests are normally done in a lab, which labs are far away, too expensive and people would incur costs and time to go. And that’s where the care breaks down.

Sam:                                      11:04                     Right.

Emilian:                                11:04                     And, you know, if someone sees a doctor and the doctor refers the person to a lab, you know, half of the people won’t go.

Sam:                                      11:11                     And so the, well, one of the innovative things that you’ve spotted is, OK part of the reasons that these clinics don’t have, don’t currently have the ability to do these tests, the tests that machines are too big of an expense…

Emilian:                                11:26                     The machines are expensive. So those clinics don’t you know, they don’t make some revenue. And the problem is that the consultations are usually the consultation fees will be too small to make the doctor survive. So it’s 100 to 200 shillings, so $1 to $2 the, every single small clinic will have a pharmacy or dispensary where they sell medication to the, to their patients and they make you know, significant revenue out of it and they would love to provide diagnostics but they can’t buy the machines because they don’t have enough steady revenue to buy the machines.

Sam:                                      12:02                     Am I right, the part of what you’re doing is you actually identified innovations with these machines and then brought them here.

Emilian:                                12:11                     Exactly. So typically, I’ll give you an example so exactly what we, what we’re doing. We identify the latest technology developments in those three, four, five areas which equate into much smaller and much cheaper but high tech devices which can be run remotely through a cloud and which can sit at a point of care so keep typically an ultrasound, right? A full size ultrasound made by one of the big brands will cost between $25,000 and $35,000. Miniature portable ultrasound made also by some of those super innovative high tech companies would cost a fraction of this maybe four times cheaper, five times cheaper. But those manufacturers are actually startups sitting somewhere in the US, in China, in India or somewhere else in Asia far from Africa with no or little plans to come to Africa today because they’ve just launched, they’ve just raised money. They’ve gone through an FDA or C approval and they have enough market where they are. So what we do, we go and then approach those companies at a founder’s level and to try to convince them to let us bring their products into Africa.

Sam:                                      13:28                     Are they, do they have any resistance to that? I mean from branding perspective or from a…

Emilian:                                13:33                     So obviously it’s, it’s easier to it’s easier to talk to companies which are startups because they’re used to you know, they’re much more flexible compared to a big corporate, which may not have a direct interest to come immediately here or which will be, you know, more difficult to work with.

Sam:                                      13:53                     Got it. Okay. So you’ve kind of got this quite good this quite good dynamic by the fact that you’ve kind of, did you say found the founder of these startups they obviously they’re not able to do a little, a little bit cheaper, but I mean is let’s say it now costs $5,000. You’re saying that the clinic is not still not able to pay?

Emilian:                                14:15                     Exactly. The clinics, even a device which is four to five times cheaper than the full size one, a doctor cannot buy it. One of the main reasons is when you look into the revenues of those clinics, no one third of them have are approved or accredited by the national health insurance and they get a certain computation, money on a monthly basis, based on a number of patients they record the day they choose to go to the clinic. This capitation money comes in batches and comes late so the biggest issue of those clinics is actually cashflow management. It’s less as a, you know, at the end of the year they would make money but they will not have money today. They also usually don’t qualify for land for credits because either they don’t have their balance sheet is very thin banks would ask them for a collateral, which is usually two X or even more as the value of the loan. And there are some digital lenderswhich may be able to lend, but digital lenders, would ask the clinic a certain size of the daily or monthly revenue coming through their digital channels, M-Pesa. And if the clinic does not have, either or, assets or significant digital revenue, they will not qualify for credit. So what we try to do is to first of all match them with a lender. If we, if we can, based again on their revenue or on their total revenue. And if we cannot, then we look into potentially lending to them ourselves on balance.

Sam:                                      15:55                     So it’s not, the default is not for you to do that.

Emilian:                                15:59                     The default. We’re not a lender actually, we’re an, we’re a technology company. So our business model is again, identifying those you know, high tech diagnostic devices somewhere else in the world, bringing them here, placing them. So distributing or placing them in clinics, linking them into a tech platform that we’re building connecting them, being able to turn them on and off collecting data.

Sam:                                      16:28                     When you say being able to turn them on and off, does that mean being able to turn off the ultrasound?

Emilian:                                16:33                     So typically if the, the device becomes a collateral for a loan. So, if the clinic in this case stops paying for any reason, we could potentially turn off the device. Obviously now it’s not our goal. Our goal is to make sure that we have that. But our goal is to make sure that we can, our goal is to make those clinics make more revenue and we work with them, we’re flexible and we try to understand how can we help the clinics make more money because we believe that if the doctors make, if those clinics make more revenue, they can deliver better health eventually. We may not be able to completely control the prices today to make the ultrasound cheaper or the blood test cheaper. We hope that we will about in the future, but at least we can bring accessibility and the rapidity of those tests and more revenue for the clinic. And by doing this, we’re also looking to into how to streamline the processes with the clinic. Once we’re in the clinic, we have a foot in the door, we see their financials, we see the processes, we understand how do they order medication we, both myself and my co-founders come from a consulting background. So we also sometimes put our consulting hats and think how can we improve the processes of our clinics?

Sam:                                      17:58                     Yeah. Okay, cause one of the things, the thing just to touch on is this idea of, you’re giving people a revenue generating assets.

Emilian:                                18:08                     Exactly.

Sam:                                      18:08                     So it’s not like somebody’s getting financing and it’s, they’re getting often consumer or is it, one of the things I always find with with financing is yes, it’s all well and good to, you know, be given some money and then being told you need to pay back 10% in 30 days or whatever. But is there a path towards peak people legitimately increasing their revenue? So…

Emilian:                                18:30                     A massive path, it’s massive but let’s take the ultrasound the modern ultrasound, if a clinic receives a pregnant woman and the clinic does not have an ultrasound machine in most of the cases, the doctor will reffer that pregnant women to a third party ultrasound clinic the lady would pay 1500 shillings for a pregnancy ultrasound, the referral clinic would receive anywhere between 200 and 500 shillings as a referral fee. In our model, if we place an ultrasound machine on the clinic desk, another doctor can perform an ultrasound, can receive that full price, which is 1500, even more if the clinic is accredited by NHIF. So up to 3000 shillings, full revenue and they will be able to pay us back a certain amount a month, which will be somehow equivalent of a two year loan at a reasonable interest rate, so this interest rate actually includes a market interest rate plus a surrogacy as if it we’re to be able to count the number of tests, we just were approximate it for now but we always look to make it affordable for the clinic, we would not place an ultrasound in a clinic where we know personally that they would not be able to get enough patients therefore per day or per month for ultrasound or for other blood tests therefore they would not be able to pay back the loan.

Sam:                                      20:14                     As I said, is there, there is pent up demand this, isn’t it? It’s not like you’re suddenly going to put these ultrasounds machines in and the local population are going to be like, well, I can’t afford this or I’m not going to…

Emilian:                                20:25                     There is a demand. There is a, the demand is there. It’s just concentrated and takes time and the logistics to go and then, you know, do those tests.

Sam:                                      20:35                     So this setup is basically opening up the market in terms of making it easier to access thesethese sites. And as such that is going to grow the market.

Emilian:                                20:47                     And eventually hopefully more affordable.

Sam:                                      20:49                     Yes, got it. Okay. You’ve had a lot of experience running companies in across East Africa and Africa. What are some of the lessons that you’re taking from your past that you’re applying to, to running Ilara?

Emilian:                                21:05                     Actually a couple of lessons one is every successful business I’ve seen in Africa has a financing component. And you know, there are businesses distributing fruits and veggies in the market. They lend eventually to those merchants they lend cash or they lend products, their business is distributing FMCG products. They also end up lending they are you know, there are a number of asswr leasing businesses, you know, lending for people to buy or to lease a motorbike, a pro a commercial asset. What am I feeling is that the successful business, the businesses amongst the six or 700 companies, I’ve seen my, in my venture capital career across, you know, around four years, across a continent, most of the successful ones have a FinTech component, even if they are health tech or education or distribution or logistic or something else, it’s always a FinTech or a financial component. So what we do here, we, yes, we we build a health technology business but with a strong FinTech component through the lending and through the cash collection from the clinics, which we try to automate. The second the second learning from us at leasing is if we can avoid to have those assets on our balance sheet. So match the existing clinics with the lenders it’s better. I know that we won’t be able to do in every single case but our first approach is enabling the clinics to access lending and only if we believe that the clinic can not access lending for a specific reason, but if they still, if we still assess them from a credit perspective as a good payer, then we lend the assets to them. Another learning is, and if I put my investor hat, you know, the market is massive. We can always think there are five, six markets around or the needs are the same. However, what we build here is a strong operational business. So some of the, some of the things we build need time. We need time to learn how to scale this business in an effective manner, in a profitable manner before we go to another market, even in another city. So we have enough clinics around Nairobi where we need to focus. So focus is super important cash management for ourselves, right? I mean, one of the main reason of startups failing is they don’t have money because they spend too fast too soon.

Sam:                                      23:51                     Okay. So then they said, forget it. And I sort of get that from a investor top down. What’s, you know how to do it, but I think what’s also interesting about you Emilian is that you’ve always had experience being the operator. So I’m interested in, I mean, can you perhaps give us an idea of how many people are currently working at Ilara? What are some principles of the way in which you’ve decided to run the day to day operations of it?

Emilian:                                24:15                     Sure. So we’re a small and nimble team for now, we’re three confounders we have two salespeople we have a couple of advisors whom we may onboard on a full time position soon. We have a medical advisor slash chief medical officer. We brought 2 other people now one on operational finance and another one on corporate development on a specific new project that we look into those clinics. So we try to keep the team small for now and indeed, each of us does a number of things there is no you know, I do the CFO, the credit manager, the HR, the legal while my cofounder Aman focuses on product and my cofounder Hannah focuses on sales and operations. Very important is the, the dynamics and the team. I’ve seen so many startups failing because founders misalignment.

Sam:                                      25:17                     What does that mean?

Emilian:                                25:18                     Founders may be misaligned in terms of goals for the company and then…

Sam:                                      25:23                     So one wants this to happen and the other…

Emilian:                                25:23                     Yeah, so, you know, luckily we’re aligned and we will continuously work on, on communication, spending time together, making sure that we, we focus on the same goals and going very fast. Speed is super important because what we miss is actually time and that’s our our most I would say scarce resource before we need to raise the next round. So we try to achieve, we have very specific goals. We’re even implementing OKRs now in the company…

Sam:                                      25:56                     And OKRs are?

Emilian:                                25:58                     So goals basically similar to KPIs, but…

Sam:                                      26:02                     What’s the difference between?

Emilian:                                26:04                     The KPI is a very specific it’s a very specific goal.

Sam:                                      26:15                     Key perfomance…

Emilian:                                26:15                     Exactly. OKR is more on a longer term.

Sam:                                      26:21                     Alright. OKRs are the thing to be doing these days?

Emilian:                                26:24                     So you know, big, successful companies always look at you know, accountability and longer goals with also with specific numbered goals for, each of the team members. So we’re implementing we have very clear objectives and we try to align on a weekly basis to make sure that we steer the company into the right direction. Yeah.

Sam:                                      26:51                     And are you doing this in an office?

Emilian:                                26:53                     So we are, we spend most of the time in the field I’m actually, we share, we have a shared office space we spend time in Nairobi garage or in key guy. But I try to spend most of my time and my team’s time in the field because I strongly believe that this is a field business. If we are not in the field, then we become too comfortable and then we stop understanding the needs of the market. One of our advisors was telling us a few a few months ago saying, you know, you can always, you know, fail to achieve a certain revenue goal, but what you can’t fail to achieve is understanding the needs of those doctors better, even than the doctor themselves. So we spent time with the doctors understanding what they need, understanding how can we help understand their behavior to be able to bring the products, the technology and the solutions that would make them make more revenue and thrive and serve better eventually their patients.

Sam:                                      27:58                     Yeah. Okay why is it called Ilara health?

Emilian:                                28:03                     It’s a good, a good question actually. The idea is that we started we wanted initially to launch this business in Nigeria and we called the company Ilera with an E instead of an A, Ilera in Yoruba means health. And then we changed from Nigeria to Kenya for a number of reasons that, you know, we understand better. Kenya, we felt, I’ve been in and out Nairobi for the past four years. Aman, my cofounder, his family comes from East Africa easier to do business that we decided to start in Kenya. And we changed the name from Ilera to Ilara.

Sam:                                      28:45                     Does Ilars mean something in Kenya.

Emilian:                                28:48                     Not really, I mean there’s a, I know that there is a milk brand, there’s a dairy brand here, but nothing, nothing else.

Sam:                                      28:58                     And will, will I certainly think so that the patient, the lady who’s coming in for the ultrasound what’s her experience? What’s her relationship with the ultrasound? Should we say? So is it that she’s feeling this is a white label product which my clinic is offering? Is it that, Oh, this is actually an Ilara health ultrasound. Is it that this is the actual manufacturer’s thing, where does the name Ilara health? Who does that?

Emilian:                                29:27                     That’s a really good question. So specifically for ultrasound, women know that they need an ultrasound the question is do they afford or not? Can they get an ultrasound? Some are close to there, to the place where they livbe. And that’s where the smaller clinics are. And they’re plenty they may not afford to come to Nairobi, take a matatu, spend, you know, 150 shillings back and forth when they’re pregnant and take time off work. Are they, I mean, those, those ultrasound machines, they’re not an Ilara brand but they come from reputable companies around the world, which have been already have gone through the approval process. They’re in the US or Europe and in Kenya so the quality of the, of the brand and actually the quality of the result, which is a color image, which is very clear for a sonographer finally is less of the patient. But is the sonographer, the person who performed the ultrasound, who needs to vouch for the device and before choosing the rights the brand that we have today, we’ve been testing a number of brands. 3 of them actually which sonographers in their offices and in the field and we’ve done the same thing for the, the blood test machines that we have currently in the market to make sure that the one that we placed in the clinics is a right one, which answers to the needs of the market. Typically, you know, a color ultrasound is, is needed versus a black and white, a certain mode is needed to identify certain conditions of the baby. The fuetus, and that’s how we, we’ve got to the products that we distribute today. Now Ilara brands so we believe that what we can build here is really bringing those clinics to a certain level. They’re very different. They’re small, they miss, they don’t have a name, they don’t have color on the wall. They don’t have assets, they don’t have processes, they don’t have IT, they may not have even beds. So there’s a lot of stuff to do within, inside those clinics, so diagnostic devices is just the first step to put a foot in the door of the clinic. But as we are in, we can help with other things with, as I said, with platform, with processes and eventually bring all those clinics, or some of them at least to a certain level which where they could become a clinic X by Ilara health where Ilara health can become a brand, which would equate with the quality service of devices, of doctors, of processes and finally, quality of care. That’s what the patient needs, in sickness needs, needs care.

Sam:                                      32:21                     At the moment, your ultrasound devices or whatever, you know, they’re in a clinic, a patient could come in, have an ultrasound, get their receipt from the, get the receipt from the clinic, walk out and have no idea that Ilara health has had any involvement with that?

Emilian:                                32:38                     Today. No. They don’t know.

Sam:                                      32:40                     But the idea is in the future it’s almost like this, you’re a franchise model.

Emilian:                                32:45                     It’s a, yeah, it’s a franchise or reverse franchise model, indeed.

Sam:                                      32:48                     Reverse franchise?

Emilian:                                32:50                     Somehow the models where you basically don’t go and your brand don’t go and then find someone to open a store, but going to an existing…

Sam:                                      32:59                     Okay…

Emilian:                                32:59                     Establishment, call it franchise.

Sam:                                      33:02                     You go and you sort of say, right, you’re a business, you’re an independent business. You’re already here. If you play by these rules, then you can call yourself Ilara.

Emilian:                                33:09                     You become part of the network.

Sam:                                      33:11                     And not only that, I imagine the sell is, you know, we’re also going to make you better?

Emilian:                                33:15                     Exactly, that’s the end goal.

Sam:                                      33:16                     Yeah. Got it is there something which is like quite a few years down the line or is it something where it’s like might be a bit sooner?

Emilian:                                33:25                     It’s going to take time, I mean, there are a couple of examples here there’s, you know, tunza brand which is a tunza NGO, which you know, gives training and I think some financing to some clinics and it has become a brand Tunza clinic is recognized as a good clinic. This model exist in education in India, exists in hotels in India, China, US, Europe. So the model were, you know, one comes the brand or a brand comes and, and brings a number of individual businesses to a certain level exists. It’s gonna take time, we’ll take time and diagnostics is a first step, probably pharmacy. The second step. Education training of those doctors is another step and eventually bringing other assets, other devices, you know, so a lot of clinics tell us, we, if, you know, if we had you know, $10,000, we would love to buy a small operating theater for C-sections cause they, they could make revenue, they could provide this you know, small surgeries to patients and they can’t. As we go, we’ll discover more opportunities.

Sam:                                      34:40                     Okay, cool. And what have been some of the surprises that’ve sort of come in the months you’ve been here?

Emilian:                                34:48                     So one interesting thing is before we started this business, I thought that there is a high demand for financing but those clinics, which are businesses finally can just not access financing. What we find now, we found also a number of cases where the owners of those clinics run away from, from financing they have that perception that banks would never give them loans, and the banks ask them for collaterals, which are impossible to provide. And they have this image of these how do you call them, shark loans. Some of them actually take loans at 30% interest rate per month to be able to pay salaries knowing that they will get revenue in the future. So some of them are actually concerned when we talk loans. So we actually have changed significantly the way we present these. It’s not alone, it’s an asset that we place and they pay back for a service so there’s no interest rate as such, it’s a bundle payment.

Sam:                                      35:57                     This is, I think one of the nuance, one of the, one of the features of the solar industry here in the solar panels is that, you know, effectively people, you know, someone comes along and puts a solar panel on the house and they pay $5 a month to keep the electricity on behind the scenes. Actually, that’s quite a sophisticated asset, it’s quite simple as a financing, but it doesn’t feel to the end customer like, Oh, this is my exact thing that I’m paying. So you’re basically taking it off…

Emilian:                                36:30                     I’m taking this experience from several companies, which I’ve looked at or invested in the past and being close to. So we apply a lot of, we try to take from solar what, what has worked and avoid what hasn’t worked. I think another thing which changed my perception. I was under an impression that they’re not enough medical establishments. I actually started, I’ve started to change my perception. There are so many we see every day. So we have a database of 10,000 clinics across Kenya, which is the government database. I found already about 50% of the clinics that we see. They’re not in the database. So I think there are more than that are they 13,000, 15,000. I don’t know yet so I don’t think there is a lack of establishments, but there’s a clear lack of training and skills amongst the 200 killings that we’ve stepped into. To date. I may have seen five doctors, like doctors, all the students have nurses or clinical officers which can perform, you know, can perform computer, can, can do consultations. They can even perform basic surgeries but they’re not doctors, so they need, they badly need training. So that’s where we come now. And typically with the ultrasound device, we provide training. We teach them how to perform a pregnancy ultrasound. We cannot teach a clinical officer to become a sonographer. Absolutely not. That’s a one that’s a one to two years you know, medical or pre-medical school. But we can teach someone to provide basic pregnancy ultrasound potentially with a real sonographer on the other side of the line. So the device that we’re bringing now has an embeded telemedicine, tele-sonography functionality.

Sam:                                      38:30                     You’re almost like you’re on Skype.

Emilian:                                38:32                     Exactly. So because the device is to a camera and then the doctor or the sonographer on the other side has access to the image and can actually freeze the image, can do whatever. A sonographer in front of a big ultrasound with buttons can do, freeze the image, increase the image stop the image, print image measure and as same for the, for the blood. So we have a device now which does a lipid profile and HBA one C. So the diabetes markers we’ve seen actually in the beginning that was for one of the tests. The results were actually fluctuating a lot and we tried to understand why, the device come from Taiwan has been CA approved, has been tested in Europe, even in India. And they haven’t had these problems before. And we realize that the problem comes from the manual part of the process, which actually equates to training, training how to drop that blood drop exactly in the place for the blood, where the drop needs to go for the device to function properly. So training plus automation or just automation. So this is the other thing that we discovered. We thought that just automation can actually replace a skill natural. And finally, finally it’s just about people. People perform, people give care that a machine cannot deliver the feeling of care, can deliver results but you know, they were feeling you still need people, doctors or clinical officer or nurses. It’s very difficult to replace them and I don’t think that the pure machine or tele-medicine will work anytime soon here. So we are in a people business but we train, we want to train an upscale those medical officers or clinical officers to get to the level of skills to operate our devices while performing or giving care.

Sam:                                      40:28                     Got it. Yup. I see that.

Emilian:                                40:31                     So we also have an education part of that.

Sam:                                      40:36                     As you, I mean, when it comes to learning how to use this company’s blood test machine, I mean, is that cost that you incur, that Ilara incurs.

Emilian:                                40:47                     So we blend this in our service fees. Obviously we perform a training initially, which is part of the sales process and we even this morning I had a meeting with a potential partner on tele training for the clinics. Face to face is very important. Face to face in the clinic is super important, but we need continuous training so we haven’t yet figured out how will we do that at scale. We do it now for the ultrasounds. We do it for the blood, for every, every device we, we deliver, we place, we train but we need to find a sustainable solution to perform continuous training.

Sam:                                      41:30                     And if we just sort of go back a few steps, I’m interested in exploring this, this crinkle you mentioned about the financing and how you’ve got these third party financing organizations, which are the ones actually putting up the money. I sort of can get how from the perspective, not having those assets on your balance sheet is useful. Is a, is a good characteristic to have? How does that complicate the operation you’ve got when you’ve then got this extra party who’s needing to

Emilian:                                42:00                     Actually, it simplifies, simplifies because the reality in this case would broker a relationship between a clinic and a lender. And we’re in a business of enabling.

Sam:                                      42:14                     So is the clinic, are they paying one payment to you and one payment to that…

Emilian:                                42:18                     They would, the clinic would pay actually a down payment to us and they will pay a principal part plus interest to the leaser, to the loan provider. So in this case, there won’t be a usage fee. There will be a one off fee that, so of clinic pays us a certain amount. In the beginning.

Sam:                                      42:41                     Say if they pay like 10% down?

Emilian:                                42:42                     10% down and they will enter in the lease agreement with a provider. So in this case, for those those clinics, we would be just an asswt provider and a trainer while the credit risk and the lending relationship will be, is between the lender and the clinic. In the clinics, which cannot, well we believe that they can not they cannot get a loan for a number of reasons and we pre-assess them, then we lend or then replace the device.

Sam:                                      43:16                     With the case where yoiu’ve got this external lender, so the clinic is paying a monthly fee?

Emilian:                                43:21                     They’ll pay a monthly fee or a daily fee actually.

Sam:                                      43:23                     A daily fee. Okay.

Emilian:                                43:25                     Which is equivalent to an interest rate, a market based interest rate.

Sam:                                      43:30                     I’m more interested in dynamics of like you, being that you have this relationship with the clinic and saying like, we’re the ones who are finding this ultrasound machine and then the payment actually going somewhere else. And like if, if you understand some of these breaks like who…

Emilian:                                43:44                     So those machines are actually, they have a manufacturer warranty for the first year. We priced in the price of the asset. We priced another year, it’s an additional year of local all risk warranty or all risk insurance actually, which covers everything from breakage to tests to malfunction.

Sam:                                      44:09                     Okay. So if the two years…

Emilian:                                44:11                     For two years the clinic, basically for the length of the loan. The clinic is, is covered. Post this, obviously we are still finally like any distributor of medical devices. We are we present, we ended up representing the brand so we’ll provide a service obviously at a cost if needed.

Sam:                                      44:38                     And that that will be basically from the finances perspective by saying, right, we’re going to put down this money every day, we’re going to get paid and the duration, two years at the end of it. Thanks very much.

Emilian:                                44:49                     Yeah.

Sam:                                      44:50                     Got it.

Emilian:                                44:51                     Because you tell lease to own, finally the goal is us to become the owners, the full ownership of the clinic. So the clinic can capture the full revenue instead of paying the interest and the principal back.

Sam:                                      45:04                     And who are these financers?

Emilian:                                45:07                     So we’ve been we have a couple. We started to work with the medical credit fund which is part of farm access here. The medical credit fund offers a digital loan as well as an asset loan, both of them based on the digital revenue potential of the clinic and they collect payments on a daily basis actually on the person’s action basis from those clinics. The medical credit fund currently focuses on bigger establishments so we were trying to you know, bring them into those small, medium to small size, and then low income clinics. We are working with a bank here CDN bank to enable the same type of lending but on a pure bank type loan and we look at other debt providers. We’re in touch with two others. So we’ll see how these relationships will evolve. We actually have the first five clinics with ultrasounds. We already have four clinics in the market part of a plan of that we started in March with smaller devices which we did on balance sheet. We just bought them and placed them just to understand the clinic processes and how we can perform to do the collection. The real business starts now with the first five clinics, which we train this week, this coming weekendwith ultrasound devices and to, you know, a couple of them will be financed through the medical credit fund and the rest will be having the other half will be on balance sheet, so that’s the first trial to see which, you know, how this is going to evolve. And as I said, we’ve been stepping into about 200 clinics and some of them are in various stages of discussions in the sales or placement process. And as soon as we’re done with those five, we’ll move into selected clinics from the pipeline. The goal is to get to you know, 60 to 100 clinics 60 things by the end of the year. And probably another hundred in the next six months, for six months.

Sam:                                      47:23                     Fantastic, we’ll just do a few more questions.

Emilian:                                47:26                     Sure.

Sam:                                      47:27                     Alright. So we’ve spoken sort of a bit about the supply side, but on the demand side, I mean from your perspective in working in this health or you’re working in the health markets, should we say I think what’s quite interesting is you’re saying you’re viewing medical devices as the first step into opening up this potentially much bigger market around improving clinics and potentially one day doing a reverse franchise or franchise with it. What are some other interesting opportunities that you’re seeing within that medical area, which you’re like, that’s really great. It’s not for us right now, but someone else should do that.

Emilian:                                48:05                     Sure so a clinic, if you look at what’s, you know, what are the needs of one of those small clinics, so they need diagnostic devices, they sell medication, so pharma products, and that’s a massive market. We’re not yet there other people do it now, we may be there one day, so we’re looking into it. They need education training face to face or distant they may need remote tele-medicine solutions and they need other assets apart from the diagnostic devices. I think I mentioned earlier, some of them need beds, others need operating theaters. So I believe that there is a huge opportunity into enabling those clinics to perform whatever they need to and where they have patients for and you know, provide better care, through training devices, inpatient surgeries and education.

Sam :                                     49:11                     And you may not have that much exposure to it, but I’m interested, outside of clinics, are there any other areas where you think other entrepreneurs should come in and do particular…

Emilian:                                49:20                     Specifically in healthcare?

Sam:                                      49:24                     Sure, I mean actually you’ve looked at lots of businesses.

Emilian:                                49:28                     Oh, in general?

Sam:                                      49:29                     Yeah, let’s go in general. Yeah.

Emilian:                                49:30                     Sure. So one thing, I think it comes from seeing a lot of businesses in Africa, is, and I have this, I always compare Africa to China, to the US and you know, in the US, you can build a pure tech platform because you have the infrastructure, you have the infrastructure there. In China, most of the, you know, technology businesses today have built infrastructure over time. And you look at Alibaba. Alibaba even has clinics by the way, or Tencent actually has clinics. So they build technology alongside infrastructure, right. In Africa, the problem with infrastructure is in existence. So Africa is in my opinion, very much about distributed things, distributed solar, distributed diagnostics. That’s what we do, right? We bring pieces of a lab into a clinic distributed everything, distributes logistics. So there’s a massive opportunity, a number of sectors and we’ve seen very successful companies here tackling the biggest needs of the consumers, which are actually still fairly basics. People need to eat. So they need to get fruits and veggies. They need to get FMCG products, there are companies tackling this with distribution and financing. Businesses selling various products, you know, there are companies doing lending market, B2B lending, which is massive. And there’s still a lot of place here. Education with a fund, I was involved for four years. We invested into one of the most successful or the most successful education technology company in Africa, based in South Africa, which sold to a US listed education online company. So education is massive. I haven’t seen too many education companies across the continent unfortunately, but I think there’s a still a huge needs, someone will need to come and find the right model, the right profitable model, how to deliver online education or on mobile education. Within financial technology there’s so much need Kenya is somehow lucky with mobile money. But there’s so many other countries in the continent where it’s very difficult to pay, very difficult to send money somewhere, very difficult to capture money as a merchant very difficult to get money as a merchant on a product loan. So bottom line, the kind of the biggest sectors that I think are the most interesting are FinTech. Obviously, you know, within the, within the $1 billion venture capital money invested in Africa last year about 35% I think was FinTech, I don’t remember exact, the number from disrupt Africa or from Partec, so FinTech is a massive sector. Within FinTech, there are a lot of sub-sectors, some of them more profitable or more interesting than others, more impactful than others. But financial inclusion is super, super you know, super needed, education mobility, massive. People need people move, right? Those cities you know, Kenya is still a, you know, massively rural or actually moving from rural to very urban but those cities in this African cities will actually double in size in the next 10, 15, 20 years and people need to move from one place to the other. Finding using technology to help those people moving is super important. Yeah. So healthcare, education electricity, so distributed electricity, solar renewables moving, moving people from A to B, moving freight from A to B, moving, you know, food or other things inside of cities.

Sam :                                     53:06                     And any words of warning or words of caution for people who are thinking of coming into this business in this part of the world?

Emilian:                                53:13                     So this is not a, this is not Silicon Valley, this is Africa. Those are emerging markets where I think the point of caution is you know, what other people think that they can, you know, build top line revenue with no or no profitability or vision for profitability and they can raise another round and another round and another round, that’s less possible in Africa because you know, from an investment perspective, if we look at macroeconomics in Africa, it’s still far in terms of returns compared to Europe or US or Asia, right? So a P firm would say, why should I invest in Africa when I can, you know, make a great return in the US, Europe or China or Southeast Asia but Africa is the future. I think Africa is the only place in the world which still has this massive potential of huge population growth, huge mobile penetration, huge, very, very young people and it’s funny, a very good friend of mine Ron, is one of the, you know, successful technology companies based in Barcelona. And I was having a call with him a few weeks ago and he was sending me why are you spending your prime, even if I’m not yet prime, but what prime years in Africa? And I was laughing. I said, well, let’s talk five years from now. So I have a massive belief in this continent. I’ve been in Africa, even if I’m not born in Africa, but I’ve been in Africa for the past 12 years plus, in and out and mostly leaving actually out of those 12 years around, so I see the massive opportunity and I still think it’s going to take time because it’s not just about technology, it’s about increasing the, growing the, the spending power of people to be able to buy those products and services. But again, I would be very careful and that’s what we try in a Ilara health as well. Very careful on how to go towards profitability, towards building a profitable high margin business, but which can be impactful at the same time and bring value to everyone, bring value to our clients, our customers, bring value to oyr investors, bring value to us.

Sam:                                      55:36                     And people listening home. How can they learn more about Ilara health, more about you? What are the best ways to learn more?

Emilian:                                55:42                     Sure. We are online. We have a website there are a couple of articles which got published last week as we closed our first seed round. So we’ve been in the media lately. People can find me on LinkedIn.

Sam:                                      55:59                     Very good. Cool. Well it looks like it’s about to start raining, so we should probably call it.

Emilian:                                56:04                     Excellent.

Sam:                                      56:05                     But yeah. Thanks so much Emilian.

Emilian:                                56:07                     Thanks a lot. And then yeah, thanks for the time.


How many eggs can you fit in an Uber? A Nairobi egg dealer on overcoming micro-business challenges


One of the nice things about having a podcast is that it allows you to have conversations with people you wouldn’t otherwise get around to.

In this episode I sit down with John, the man who I buy my eggs from in Kenya.

In Swahili, “mayai” means “eggs” and so his customers know him as John Mayai.

John works from an apartment building in Nairobi, and stores thousands of eggs in the car park to then sell to individuals and small businesses wanting to buy them in multiples of 30.

We talk about how he started the business buying and selling 5 trays of eggs, and is now up to 80, how cold weather affects the price of eggs, and the main challenges that come from expanding the business.

Now, the big limiting factor John mentioned was the ability to buy more eggs and transport them back to the car park to then sell to local businesses.

“There’s always demand for eggs” as John put it, so it’s just a case of increasing the supply.

Immediately after recording this episode I went for lunch my friend Raaj and we got chatting about how we could help out John to expand his business.

Long story short, the next day we were in a car with him driving up to a large egg market on the outskirts of Nairobi, returning a few hours later with nearly 5000 eggs.

I made some recordings from the trip, and so who knows, perhaps one day it’ll get made into an episode.

Anyway for now, there’s lots of interesting insights from John and I’s conversation and so I hope you enjoy this episode.

John’s business is representative of how a lot of people in Kenya work and live – buying and selling products and at a low margin in order to fund other areas of their life, such as school fees for the children.

I hope you find it enlightening.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!




Sam:                                      00:00                     Intro

Sam:                                      02:24                     Cool. So we’re here today with John. So yeah, John, we’re going to talk today a bit about your your work and your, your side business.

John:                                     02:33                     Okay. Side hustle.

Sam:                                      02:35                     Yeah. So John Perhaps the best way to sort of get started is, is if you could just sort of give us a brief overview of sort of what you’re, what you’re doing right now

John:                                     02:49                     In fact I started, sometime two years ago. I was impressed when I saw people buying eggs, others selling eggs and in the morning hours, I was, Idle.

Sam:                                      03:03                     Yeah. Cause what is your, what is your main job?

John:                                     03:07                     My main, I’m a chef.

Sam:                                      03:08                     You’re a chef.

John:                                     03:10                     I am a chef, employed here. But my business is my, it’s in my mind. I’ve been doing business throughout my life.

Sam:                                      03:19                     Okay.

John:                                     03:19                     But at the end of the day, my business came down and I was, I didn’t, I couldn’t go farther, so I had to look for alternatives. I was employed here.

Sam:                                      03:31                     Yeah.

John:                                     03:32                     So I have to work so that I can push my family and those who are in school, I push them. Now when I was here and business minded just going around, I saw people selling eggs, like I went closer and asked them how much are you selling these eggs? We’re are selling, by then they were selling Ksh 330, one tray. When I went to up country. I went to the market, I did my survey.

Sam:                                      04:04                     Yep.

John:                                     04:05                     I got there were people who were selling at Ksh 270, 280

Sam:                                      04:10                     So when you say a tray of eggs, that’s maybe, is that 30 eggs?

John:                                     04:16                     30 eggs, yeah.

Sam:                                      04:16                     Okay. So upcountry.

John:                                     04:17                     Upcountry they were selling Ksh 280, 270.

Sam:                                      04:23                     Yeah.

John:                                     04:23                     I bought five.

Sam:                                      04:25                     Okay. So you said you had five times 270, so you had 1300?

John:                                     04:30                     Yeah.

Sam:                                      04:31                     1400.

John:                                     04:34                     I had 14 cause I had fare, my fare.

Sam:                                      04:37                     Yeah.

John:                                     04:38                     I came with my five trays, not Knowing I would sell to who, but in my mind, even if he won’t to buy, I’ll go, I’ll look for somebody else.

Sam:                                      04:48                     Yeah.

John:                                     04:50                     And we went, I went, the first day I sold two trays. I was very happy.

Sam:                                      04:55                     Yeah.

John:                                     04:56                     Of course. Now the remaining are three, the next day I went, I looked for another option, another customer. He told me I want at least five. If you have three, still bring five. I told him I’ll bring three today, tomorrow I’ll bring five. It was a market day. I sold her three, I went to the market, I bought six.

Sam:                                      05:21                     So you went back, you went back to the same market, upcountry?

John:                                     05:24                     Yeah. Up Country.

Sam:                                      05:24                     Okay.

John:                                     05:25                     I bought six. I came, I sold, now this guy I sold him five. I went home with one. With that time, from then, I been, I didn’t have more money. I had only the little one and now I go, I try to buy 80.

Sam:                                      05:48                     80.

John:                                     05:51                     80, I deliver them now. They are used to me. They, we knew each other. They just take my phone, they ring me, bring bring, bring. And eventually, I saw I can make something. All the same, I have one child who is in, still in school and this child is doing nothing. So I have to push her. At least I push her until she gets whatever she wants. And the little money I get here working, they are not enough. So I have to strain myself. I feed the family I feed and the and the school fees. So I have to pull up my socks and I tried to, I don’t drink but I have a rule the little I have, I try to use it in an orderly manner.

Sam:                                      06:52                     Yeah. Okay. So all of the so the, this, the egg business that you have that’s already sort of funding other parts of your family.

John:                                     07:01                     Yeah, it is funding and pushing the, those who are in school, even now he’s at KMTC. He has finished, he has a certificate but he said a certificate is too low. He wants to advance.

Sam:                                      07:19                     So he needs to go get…

John:                                     07:19                     No, he’s now advancing. Still there. And since he’s determined, I said I’ll push him to the end. So we are there.

Sam:                                      07:28                     Makes Sense. Okay. So at the moment, so two years ago you, you went up country and you bought your five trays of eggs.

John:                                     07:37                     Yeah. From then, I’ve been going daily.

Sam:                                      07:40                     Daily?

John:                                     07:43                     No, weekly, weekly.

Sam:                                      07:43                     And so you’ve slowly been increasing and now you, now you do 80 trays of eggs. How do you, how do you transport 80 trays of eggs?

John:                                     07:53                     I put them in a big box like this one. I fold them with a rope, tightly.

Sam:                                      08:00                     Okay.

John:                                     08:01                     Then I put it in a ‘matatu.’

Sam:                                      08:03                     Okay. ‘Matatu’ Is the bus?

John:                                     08:06                     The bus. I pay as if it’s a customer. I pay the luggage and me.

Sam:                                      08:14                     I see. Oh, so you pay for two fares. One is for you to sit and one is for the eggs to sit.

John:                                     08:19                     Then when I come, to ‘Kawangware’ then I shift to another car. When it reaches here, now I get the trolley, I bring them here.

Sam:                                      08:30                     Yeah. Okay. Do they have a break?

John:                                     08:33                     No. They break. Yeah. Like do you see this one?

Sam:                                      08:37                     We’re looking at this tray now where they are some broken eggs.

John:                                     08:41                     They are broken, but they are not many. If you, they can be broken less 10. You won’t feel it. But if it’s more than a tray, it will cost you. You’ll cry, but all the same, I know they are perishable things.

Sam:                                      08:58                     Yeah.

John:                                     08:58                     And they list, they are not, I handle them with the care. When putting in the car, when offloading. You have to be very, very sensitive. Even whoever is helping you, he helps you in an orderly manner. You pull them down slowly. Then you tell him thank you he goes.

Sam:                                      09:22                     And where do you, why do you buy your eggs from?

John:                                     09:25                     From ‘Wangige,’ it’s a big market where people, about 1000 farmers go to that.

Sam:                                      09:35                     Whereabouts in Kenya is it?

John:                                     09:36                     It’s not far. It’s between Nairobi and Kiambu.

Sam:                                      09:42                     So it’s maybe 40 minutes?

John:                                     09:45                     If you have a personal car is half an hour.

Sam:                                      09:49                     Okay.

John:                                     09:49                     It’s not far. But now the cash, I don’t have a car so I have to…

Sam:                                      09:56                     Take a ‘matatu.’

John:                                     09:57                     I have to use a ‘matatu.’

Sam:                                      09:59                     So the, all the, poultry farmers, the egg farmers that are coming to this market.

John:                                     10:06                     Very many. Over a thousand farmers come, there is a market place. They bring their eggs. Customer know, they go buy their egg there. They go.

Sam:                                      10:16                     And so are you buying directly from the farmer?

John:                                     10:19                     Yeah, exactly. I have three, four farmers who they are, we are used to. Okay. When they, they come, they phone, we have arrived, OK, I’m on the way, when I reach there and I wanted these eggs. Okay. We just bargain and I transact, I pay.

Sam:                                      10:39                     And do you always pay cash or do you have like…

John:                                     10:41                     Always cash.

Sam:                                      10:42                     No they don’t give credit?

John:                                     10:43                     No they don’t give credit because now they are demanding the chicken want to eat. They don’t have money, they have to go and buy.

Sam:                                      10:50                     So they need to get it so you can more eggs Okay. And so you go there is the price still Ksh 270 for a tray?

John:                                     11:00                     No, it is not constant. Sometimes it’s low, sometimes it’s upper.

Sam:                                      11:05                     Why does it change?

John:                                     11:06                     Because of the climate. Like now it’s cold. So the eggs, the chicken are not hatching eggs. Why? Because of the weather. It’s cold. Some who, supposing you didn’t feed them properly? They won’t hatch.

Sam:                                      11:23                     Yeah.

John:                                     11:23                     But if you feed them proper, they will hatch. It goes with the weather and the type, of Type of food you are giving the chicken. There are chicken which, you can, you can have at least 500 chicken, but you are giving them bad, bad.

Sam:                                      11:45                     Bad food,

John:                                     11:45                     Bad food. So the production will be low. But if you give the, the quality, the best quality. They will still, they’ll hatch.

Sam:                                      11:53                     Okay, that’s good. And so you can always get, so normally though you’re always able to get eggs?

John:                                     12:00                     I tell you there are over 1000, 10,000 farmers, over

Sam:                                      12:06                     Okay. So there is no problem with getting eggs

John:                                     12:09                     Getting eggs, unless you don’t have money. Now that time, you can say you won’t get but when you have money you definitely have to get, even if it’s 1000 trays.

Sam:                                      12:20                     Yeah.

John:                                     12:21                     You get them, you pay, you get them, you put them in your car, back off, you go..

Sam:                                      12:27                     Okay. So that’s so it seems like you’ve got quite a good supply chain as in it’s quite simple. You can go, they’re all the…

John:                                     12:34                     But the problem here is only the available money cause I wanted to buy more than at least a hundred and but I reached 80, I’m squeezed, there are problems here and there. I push a portion, so I’m close that, I don’t want to do, I don’t want to go below 80. I want to stand at 80. The little I get, I can use that into the family, to school like that. Okay.

Sam:                                      13:04                     And on, on the, on the demand side, so in terms of who’s buying the eggs, so you, you sell them for Ksh 330, is it?

John:                                     13:13                     No, I sell them, the current is Ksh 300.

Sam:                                      13:16                     Ksh 300. OK.

John:                                     13:17                     So I make 10 shillings for transport. So I can, I know I normally get 10 shillings out of one tray. If I have 80, I have, Ksh 800.

Sam:                                      13:29                     Yeah.

John:                                     13:30                     If they are not broken, if they are broken, you might get Ksh 750, 700 like that.

Sam:                                      13:37                     Okay. So each each time you make a trip and you come back with 80 trays, you’re thinking I’m making about 750 shillings.

John:                                     13:47                     Yeah.

Sam:                                      13:47                     Roughly, which is about $7 50.

John:                                     13:50                     Yeah. That one easily I’ll get it.

Sam:                                      13:52                     You’ll get it.

John:                                     13:53                     Yeah.

Sam:                                      13:53                     Okay. So if you, if you go with that, you’ll come back with that.

John:                                     13:56                     Yeah.

Sam:                                      13:57                     Okay. And, I mean we’re, we’re currently sat in the, this is, this is your, your room?

John:                                     14:04                     Yeah. I’m given this room, after working, I sleep here.

Sam:                                      14:10                     This is an apartment.

John:                                     14:10                     Apartment.

Sam:                                      14:12                     And you keep the, store the eggs here?

John:                                     14:17                     No, I keep my eggs here.

Sam:                                      14:19                     So we’re just looking in the corner of the room is

John:                                     14:23                     Yeah, that’s four eggs.

Sam:                                      14:25                     Yeah. .

John:                                     14:26                     And you see when I, like today I want to finish the whole load. I finish the whole load, then I, I know tomorrow or the day after tomorrow, I’ll go for market.

Sam:                                      14:37                     You’ll go to the next. Okay. Who, so I’m one of your customers so I live a few minutes walk away and I will come to you and I’ll pay 300 shillings to get my tray of eggs. Who else is, who else is buying eggs from you? Yeah. Who else comes and buys.

John:                                     14:57                     There are people, a few apartments, like your apartment. I have three, four apartments. I deliver two, three, four, three, three eggs, four eggs, four trays, about, no five plus those two, six apartment. Usually I take, I deliver them there. Okay. There are others who come here, they take, take their, to their business. Small, others big, others, they’re different.

Sam:                                      15:27                     Sometimes it’s businesses?

John:                                     15:29                     They come here, and I leave at least 10 trays with the soldier. Even if I’m not around, they pay the soldier…

Sam:                                      15:36                     When you say the soldier, this is the guard whose at the gate. So this means if…

John:                                     15:41                     You are not around, I leave them there.

Sam:                                      15:44                     Sometimes I’e done that. I’ve come and I’ve asked for, asked for John, you’ve not been here and the guard has said, oh it’s okay, I’ve got the trays.

John:                                     15:52                     Because now the 10 is easy to calculate. I’ve sold four, so you have six. And they gave me a shot and by the end of the day I just push him something small, he’s happy and we call it a day.

Sam:                                      16:07                     Call it a day. Great, and so it’s, sometimes it’s small businesses, sort of like hotels, restaurants.

John:                                     16:13                     Hotels. They are very many. They are many. But now since my time is limited, It’s only morning when I can go out, I deliver, afternoon I’m occupied here. Now you see I can’t go in the afternoon cause I’m working here. But in the morning I utilize the little time I have, I make sure I have surveyed at least every corner and as I make calls then we communicate because I work from morning to noon, from noon I, business of eggs I finish.

Sam:                                      16:49                     Okay.

John:                                     16:50                     Now go back to my business.

Sam:                                      16:53                     Very good.

John:                                     16:56                     If I can get something like a van.

Sam:                                      17:01                     I was about to say, what are the main challenges.

John:                                     17:04                     The challenges are, now you see 800, wee need to transport them in a keen way, you know because in the, you can go to, you hire a car and that man, that taxi man, he’s been called somewhere else. So he’ll drive you faster. By driving you fast, at least, some things are delicate, will be broken. When he reaches, you tell him let’s move cause he want to go to their other costumer. But you have, if you can have, let’s say a personal car, I tell you me, I can’t do any other job. I can do only this. I know I have my 500 trays. I have sold 300, I’m remaining with, I can do now more, only this. Because now the suppliers I know where I’ll get them, beautiful fresh eggs. From there, I knew where to deliver to customers, but then the challenge is transportation

Sam:                                      18:10                     At the moment you have to take it on ‘matatus’ and so it’s, you have to be there and there’s only enough room for about 80 trays. But if you could get the transports, you know that that would be the, that would be the game changer.

John:                                     18:25                     I can, I can be the happiest man in this world cause I know my luggage will go safely, reach, I’ll keep it there.

Sam:                                      18:34                     And would you be able to sell 500 trays? Because at the moment you’re selling 80 trays. That’s like, 500, that’s like 500% that’s like five times as much.

John:                                     18:49                     No. I can sell even 500 but now that, that time I can tell now the boss, I’m a bit tired with the business, I concentrate on eggs only

Sam:                                      19:02                     So how do you, okay. So let’s sort of think, so who, who would buy, who would be your customers? So at the moment you’ve got some small hotels.

John:                                     19:12                     No, I saw I have a small, but others like my neighbor here, he was telling me when I can deliver 300 trays in one week.

Sam:                                      19:21                     And who is that? What did he do?

John:                                     19:24                     You know, he’s a, has a supermarket.

Sam:                                      19:27                     Okay.

John:                                     19:27                     But he’s a Chinese.

Sam:                                      19:29                     Okay.

John:                                     19:29                     Now I can deliver the 300 but financially, I am weak. Second thing, I don’t have something to carry and to bring and to…

Sam:                                      19:40                     You needed the transport.

John:                                     19:42                     Market is there. If I can go outside on a serious game, I can sell 500 trays a day.

Sam:                                      19:49                     500 a day.

John:                                     19:51                     A day, one day, 500.

Sam:                                      19:53                     No.

John:                                     19:54                     I can sell. I sell here three, the others I sell a hundred, I go another corner, a hundred, finished. I go home.

Sam:                                      20:02                     So where did the, where did the, this Chinese supermarket. Where do they currently buy their eggs from?

John:                                     20:08                     You see the Chinese, they like these African eggs.

Sam:                                      20:12                     Okay.

John:                                     20:13                     Because they have looked at them, they saw they are good quality.

Sam:                                      20:19                     Great quality.

John:                                     20:20                     They enjoy them.

Sam:                                      20:22                     Yeah.

John:                                     20:22                     So they need them.

Sam:                                      20:24                     Okay.

John:                                     20:25                     Now they want a constant…

Sam:                                      20:27                     Constant supply.

John:                                     20:28                     Supplier.

Sam:                                      20:29                     Yeah.

John:                                     20:29                     Maybe I used to learn my, I know we know each other, but now me, I, they tell me of 300, I tell them I will see them, but I don’t go back and go another corner. Because they want too much, which I don’t have.

Sam:                                      20:45                     They want…

John:                                     20:45                     They want many.

Sam:                                      20:47                     Yeah, and it’s you can’t, so they want eggs, you don’t have the money to buy.

John:                                     20:51                     I don’t have the money to buy.

Sam:                                      20:53                     Yeah.

John:                                     20:53                     And I don’t, something to deliver, you see. I gave them, but if I can, if they can be, they tell me deliver 300 and I have a car and money, I deliver.

Sam:                                      21:08                     Yeah.

John:                                     21:10                     Okay. One week I can deliver 500, I go to another place, 500 only eggs.

Sam:                                      21:18                     Yeah.

John:                                     21:19                     Only Eggs. And I mix eggs. This grade and ‘Kienyeji.’ There are two types.

Sam:                                      21:25                     Say it again.

John:                                     21:27                     There are these grade.

Sam:                                      21:29                     Gray?

John:                                     21:30                     This grade, is normal.

Sam:                                      21:32                     Okay.

John:                                     21:33                     And the other one, local, local chicken which are, when they go to look for them, their food outside.

Sam:                                      21:41                     Okay. Which, which ones are better?

John:                                     21:44                     Those ones are, they are very rare. They are not many, they’re rare. Cause now you see this is, if you have two brothers you share the small portion you have, you fence yours and maybe he’s growing onion and ‘skuma,’ spinach.

Sam:                                      22:03                     Yeah.

John:                                     22:03                     You don’t need any chicken to go in the garden. So many people have, they have, they have fenced where they’re putting poultry.

Sam:                                      22:16                     Yeah.

John:                                     22:18                     But the others are better than these. They are very rich.

Sam:                                      22:22                     Why? Why are they better?

John:                                     22:23                     Because of the type, their type but honestly, they are good. They are good. But if I were told which, choose among the two, I would choose the other one and they are rich more than, but even these, they are good.

Sam:                                      22:40                     Even these are good.

John:                                     22:42                     Cause many people now. I don’t know, and also there’s no as this one.

Sam:                                      22:47                     Okay. How many do you, do you eat eggs? Do you have eggs to eat?

John:                                     22:54                     No. Let’s say when they are broken, that time I say you now at least, like yesterday I took four. Yeah.

Sam:                                      23:01                     Okay. So when they are, when there’s like some which are slightly broken.

John:                                     23:05                     When they are not broken me, I don’t eat, I sell, I sell. When they’re broken now I say these I don’t know, somebody to sell and I bought them. I bought yesterday.

Sam:                                      23:17                     Yeah. So John, we’ll sort of just finish up now. But basically it’s, I mean I’ve, this is just, it sounds very, very interesting. Like you’ve had the business for, is it two years now?

John:                                     23:35                     No, This is. Yeah. This is the second year.

Sam:                                      23:37                     Second year. Yeah. So you’ve gone from five, five trays.

John:                                     23:40                     Yeah. Now I’m at 80.

Sam:                                      23:42                     Now you’re kind of looking at, okay, how can we get to the…

John:                                     23:46                     If I can get something to boost me, I go instead of going for 80, after one day I go another 80…

Sam:                                      23:54                     At the moment, you’re saying the demand is there. So people want to buy,?

John:                                     24:00                     People want, I tell you my neighbor here, here, the Chinese supermarket, they know me. There’s a time I delivered them but I didn’t, we didn’t go far. They know me. I know they, they delay paying but they pay.

Sam:                                      24:20                     Yeah.

John:                                     24:21                     They are good.

Sam:                                      24:22                     Okay.

John:                                     24:23                     If he tells me bring, he will take them. He sees them. You Count, he writes you an invoice. That’s money. Even if you are not going to get that day, next two days.

Sam:                                      24:37                     Okay. And you recon that, in order to, the thing that you need to grow the business, it’s just the ability to do transport.

John:                                     24:43                     Yeah. If you can get the transport and at least with small capital to add the little you have, you’ll sell. You’ll sell.

Sam:                                      24:55                     Cool. Well, that sounds really good John. I’ll yeah, I’ll certainly be thinking about this and also I will talk to some, some friends.

John:                                     25:03                     Okay.

Sam:                                      25:04                     But yeah.

John:                                     25:05                     I can be very happy. At least somebody, if you can just boost me, small.

Sam:                                      25:10                     Yeah.

John:                                     25:11                     You’ll also see you cause now I won’t tell you of 80, I will tell you 200, 300.

Sam:                                      25:19                     Will you have enough space because at the moment this, at the moment the eggs are in the room but do you need a new place to store them?

John:                                     25:26                     No, I can now talk to the boss here.

Sam:                                      25:29                     Yeah.

John:                                     25:29                     We keep them outside.

Sam:                                      25:31                     It’s a big car-park.

John:                                     25:33                     There’s a small portion. I tell him I will utilize this, because he knows me. [Inaudible] Cause he knows me, I’m a bit hardworking and I don’t have anything else in my mind. I know his time. I know my time.

Sam:                                      25:57                     Yeah.

John:                                     25:59                     No, the place to put, there is. Even I can remove this thing, I put another hundred there, another hundred and another hundred here. The space is still on, yeah.

Sam:                                      26:13                     Awesome. Cool. Well John, thank you so much.

John:                                     26:16                     OK. Thank you Sam.

Sam:                                      26:18                     Asante sana

Fortune at the Bottom of the Pyramid, why SunCulture can profitably sell to smallholder farmers


If you’ve been following The East Africa Business Podcast for a while, you might notice that most episodes are around the 30-40 minute mark.

Whilst that was the intention here, in this episode Samir and I end up chatting for well over an hour.

The reason being is that (to me at least) there’s just so much interesting stuff to talk about the business he’s running.

Sunculture exists to improve productivity amongst smallholder farmers, and does so through a variety of services including solar irrigation pumps and financing all run on a state-of-the-art software platform.

We talk about how and why the company was formed, why Samir believes that, unlike the US, there will always be smallholder farmers in this part of the world, and how Sunculture’s dream team operates, in part motivated by Samir’s monthly emoji email.

A big part of the Sunculture thesis on development is aligned with the discussion I had with Conrad Whitaker. To learn more, search for the episode on the Distributed Economy.

We do the interview in the garden of the lovely Sunculture offices and so there may some background noises (including a nearby scuffle between a dog and monkey) which I hope doesn’t detract from what is a really fun and information-packed episode.

We sometimes go a bit off-piste, including how Samir is hoping to one day reach out to the Ohio band that share Sun Culture’s name. We sample one of their tracks at the end of the episode, if you’re interested.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



Social Media Links



Twitter: @SunCultureKenya



Sam:                                      00:00:00               Intro

Sam:                                      00:02:15               Cool. So we’re here today with Samir from Sunculture. Samir, welcome to the show.

Samir:                                   00:02:19               Thank you very much.

Sam:                                      00:02:20               Cool. So we’re here in the Sunculture garden. Would you call it a garden?

Samir:                                   00:02:25               I call it a garden. Yeah.

Sam:                                      00:02:26               So we’re in your new office, which basically, you know, to say it’s an office is unfair, when you’ve got a vegetable patch over there.

Samir:                                   00:02:34               You know when we harvest, we actually cook those vegetables for lunch. You’re more than welcome to come by. You’re missing it by a couple of weeks.

Sam:                                      00:02:42               No way,

Samir:                                   00:02:43               Sadly.

Sam:                                      00:02:43               Okay. Anyway, what does Sunculture do?

Samir:                                   00:02:46               So we exist to help improve and protect the productivity of smallholder farmers. So our official mission is that we develop and commercialize life changing technology that solves the biggest daily challenges for the world’s 570 million smallholder farmers.

Sam:                                      00:03:05               Okay.

Samir:                                   00:03:06               Solve problems, help them increase their incomes, allow them to participate in consumer markets, and then a whole lot of macro issues can be solved. So lifting a lot of people out of poverty helping Africa not spend the $110 billion, it’s projected to spend importing food by 2025, help people be able to make money in rural areas. So you don’t have mass urbanization and the challenges that come with that. But at the very core of it, it’s helping farmers increase their productivity.

Sam:                                      00:03:35               Pretty cool. Okay. What are some ways which you do that?

Samir:                                   00:03:38               So when we, I’ll give you like our little trick for how we think about this. Okay. And then you can also come up with all your own ways of solving this. So we have this framework that we called the productivity ladder. So a lot of folks in energy who you’ve probably spoken to think about their services in terms of the energy ladder. How do you get people to use more energy services over time? We think about it in terms of how do we get our customers to become more productive over time. So how do we get them to climb up the productivity ladder at the base of that, when you look at the sort of core problem you need to solve, you have to look at how a farmer lives. Farmers, or at least most of our customers, the smallholder farmers in east and west Africa live on plots that are about this size as our subculture garden. They live in a, in a small structure that’s like the small structure on our, on our property as well. And they make money by either selling crops, selling animals, or selling milk from their livestock. All three of these things need water. And because most people get water by physically filling up these buckets with 20 liters of water, which weighs 20 kg. So if you went to the gym and this morning, it’s those big weight plates at the gym, because it’s so heavy, they’re only able to move enough water to barely meet their domestic needs. So they practice what’s called rain fed agriculture. Which, rain is inconsistent, unreliable. They don’t get enough of it.

Sam:                                      00:04:59               Rain fed agriculture is, basically…

Samir:                                   00:05:01               You wait for the rain to fall. That’s it. Yeah. And they don’t get enough water to become productive. So if you’re looking at figuring out how to give their crops enough water to grow, or their cows enough water to produce a sufficient amount of milk or their chickens enough water to hatch eggs and have more chickens to sell, You need to figure out how to move water from where it is to where it needs to go. So most people know us as a solar irrigation company because we were the first company to commercialize solar irrigation in Africa. But, solar irrigation isn’t a silver bullet. It’s just the first step on the product, to be honest.

Sam:                                      00:05:32               The first round.

Samir:                                   00:05:33               Yeah, first round. Makes Sense.

Sam:                                      00:05:35               Yeah. Cool. So solar irrigation, that is using solar panels to create energy to pump water from a river?

Samir:                                   00:05:43               River, well, lake, bore hole water harvest area, dam, any water source.

Sam:                                      00:05:49               When did you start that?

Samir:                                   00:05:51               We started our first pilot in late 2012. We spent the first seven months in the field, started selling stuff in 2013. Didn’t raise any additional capital or didn’t start raising external capital till mid 2015. Only kind of had figured out what product market fit could look like.

Sam:                                      00:06:09               Okay, and what did it look like?

Samir:                                   00:06:10               It looked like solar panels pumping water or powering a submersible water pump, pumping water to an elevated tank and then using gravity to release water through drip irrigation. And we’ve since then sort of moved away and iterated on the product, made it more affordable, made it more modular. That was what V1 looked like. It was called the Aggro solar irrigation kit. If you Google, you’ll still find some like pictures and articles on the Aggro solar irrigation kit.

Sam:                                      00:06:38               Yeah, that’s all right. So yeah, just say, cause we’re in the garden, people are beginning to go home.

Samir:                                   00:06:43               Yes.

Sam:                                      00:06:43               Yes. Hence, there might be a sound of a car.

Samir:                                   00:06:46               There might be sound of cars. There might be a sound of birds. Really loud birds if you get lucky.

Sam:                                      00:06:49               Excellent. Okay, so you started off, you said it was like 2015, was when you…

Samir:                                   00:06:56               Started getting our first sort of bit of grants.

Sam:                                      00:06:58               Yeah.

Samir:                                   00:06:58               So we came with some friends and family loans, which we paid back. Yeah. And then we said, look, we were, no one’s doing this anywhere. We need to figure out what, what this looks like. And I’m sort of air quoting this, this and this looked like technology bundled with value added services and financing.

Sam:                                      00:07:19               Okay.

Samir:                                   00:07:19               And then we started in 2015 raising some grant capital to try it a bit more at scale. And then over the years we continued to iterate on our product. So we went from a product that costs about $5,000 down to $500, which took three days to install, and now it takes a few hours to install, that combines hardware and software now and now we’re sort of this one stop shop for smallholder farmers where we have a technology platform that includes hardware and software and we bundle it with value-added related services and financing.

Sam:                                      00:07:55               Okay.

Samir:                                   00:07:57               Yeah, yeah. A lot of things.

Sam:                                      00:07:59               Ok, on that, how many people work at Sunculture?

Samir:                                   00:08:03               We have official count as of last week was 88 non sales employees and we just trained our 99th sales agent.

Sam:                                      00:08:18               88 plus 99.

Samir:                                   00:08:19               You want to do the math.

Sam:                                      00:08:21               I just wanted to make sure that you don’t have 11 people. All right, cool. Why do you separate them like that? Why did you, why did you speak to them separately like that?

Samir:                                   00:08:30               Dude, we just went through a huge hiring and on-boarding of sales agents. So in my head, one of the metrics for tracking is how many people we’ve trained for sales agents and we just finished 99 so it was just separated in my head. Just in terms of counting numbers.

Sam:                                      00:08:45               It’s not like you have one office where all the non sales employees go and another where sales people.

Samir:                                   00:08:50               Yeah. That’s just how I viewed it in my head right now.

Sam:                                      00:08:54               Okay. Very cool. And when, how many people did you need to get to V1 ?

Samir:                                   00:09:00               Two.

Sam:                                      00:09:01               Really?.

Samir:                                   00:09:02               Need to get the V1, yeah, it was myself and my co-founder. And that was V1, like original V1 like the OG V1.

Sam:                                      00:09:09               Yeah.

Samir:                                   00:09:09               Was us two existing products off the shelf. We put it together on a farmer, on a farmer’s farm.

Sam:                                      00:09:17               Yeah. How did, how did you get in situation where…

Samir:                                   00:09:19               Yeah. So I am not a farmer.

Sam:                                      00:09:23               Okay.

Samir:                                   00:09:24               My family’s from here.

Sam:                                      00:09:25               Yeah.

Samir:                                   00:09:25               So my family got here from India in 1850. Okay. They got on a boat and decided to check where the wind would take them and very fortunately landed in Zanzibar, not a bad place to land and live there. And then in the 70s, they left and I grew up with this emotional attachment to the region and sort of a feeling of responsibility to…

Sam:                                      00:09:45               When you say left. And they left.

Samir:                                   00:09:46               They left in the 70s, went to North America. Yeah. So did what a lot of immigrants do. Find someone that they know somewhere else and just go there. So they ended up in Canada where I was born and then I grew up in Florida and went to school in New York and yeah, grew up feeling responsible to use the opportunities that my immigrant parents never let me forget they gave me to solve big problems. And my co-founder, Charlie had this idea to combine renewable energy and agriculture and he looped me into it. He actually, this, I only got involved by pure luck. The Universe is, was working in, in our favor. I guess he wanted to put this idea through a business plan competition at the university I went to and in order to enter the competition, you needed someone on your team who went to the undergraduate business school at NYU where I went to school and I was the only person he knew that went to that program, so he just asked me to sign a piece of paper, letting him enter the program and pretending I’m on his team.

Sam:                                      00:10:58               And you’re a, hold up this looks pretty good.

Samir:                                   00:10:59               Not, not even then. It was a few months later, he calls me on a Wednesday night at like 10:30 PM and if anyone calls you on a Wednesday night at 10:30 PM it’s trouble usually. So I was worried. I say, “hey man, what’s going on?” He goes, “we’re in the semifinals.” I’m like, “of what?” He’s like, “remember that competition that we entered? We’re in the semifinals and I’m calling you because you need to pitch with me so it looks like you’re on my team.” That was when I was like, wow, this is actually interesting. He had no idea of my family background. He had no idea that I was really passionate about the private sector’s role in economic development. No idea. It just happened that we had complimentary skill sets, we had similar values. We wanted to solve big problems. Like it just worked out super, super well and so one of the things that I think we we’re the luckiest about just figuring out a working relationship and that works well.

Sam:                                      00:11:50               What was it about the initial pitch which grabbed you?

Samir:                                   00:11:53               The macro numbers for sure.

Sam:                                      00:11:55               Okay.

Samir:                                   00:11:57               We saw, and you know Charlie, Charlie saw this early on, there’s this huge untapped asset class in smallholder farmers, right? 570 million of them globally that because they practice this rain fed agriculture, they don’t make so much money. So between 600 and a thousand dollars per year, they don’t have any disposable income. Their incomes are not predictable or dependable because they’re relying on the rainfall, which is unpredictable and unreliable, which means that banks don’t want to finance them and insurance companies don’t want to insure them. So these smallholder farmers don’t have access to capital to invest in assets to help them make more money later on, which means they can’t participate in consumer markets. And then all those macro problems happen like I talked about.

Sam:                                      00:12:41               Yeah.

Samir:                                   00:12:41               So we said if we can figure out a way to create a dependable and reliable income for these farmers, we, one, can build a really meaningful business that no one is doing. We can lift an entire group of people out of poverty. We can create a new consumer market, we can then sell into that consumer market. We can then also solve all these big knock on effects. So that’s how it started.

Sam:                                      00:13:06               Yeah.

Samir:                                   00:13:07               It just, no one was doing it. It made sense. We said, why not try it.

Sam:                                      00:13:11               Yeah. And then from there you were like, you’ve felt some connection to East Africa and you’re like, let’s just go over and try it out. Or like when did you, when did you first…

Samir:                                   00:13:20               We got second place in the competition, that fueled the fire a little bit.

Sam:                                      00:13:23               Yeah.

Samir:                                   00:13:24               And then I was working at PWC at the time. Yeah. My sort of that, that was my post, post college job. I was in their financial services, structured products and real estate group and Charlie had taken a year off of school to start a consumer electronics business in New York. That’s a whole separate story. Very funny story, which I maybe we’ll get to later. And I had saved, I had saved I think 17 days of vacation in PWC. So that’s Monday through Friday, five times plus a little bit more and add on weekends. That was 23 days.

Sam:                                      00:14:01               Yeah.

Samir:                                   00:14:02               So we decided to use those 23 days and come here and try pilot, post getting second place. Charlie had come in January of that year just to check it out. But it was really, you know, we got second place. We were, we thought that we deserved first place because it was such a big opportunity.

Sam:                                      00:14:21               What did get first place?

Samir:                                   00:14:23               A company that was making iron fortified cookies for pregnant women who were anemic.

Sam:                                      00:14:32               Okay. In the US?

Samir:                                   00:14:34               In India. Yeah. So we said this has to work there, there has to be a way to make this work. So we went in, we launched the pilot and we had a sort of set of questions that we said, if we answered yes for all of them, we’ll do it. We answered yes to all of them and we…

Sam:                                      00:14:50               What were some of these questions?

Samir:                                   00:14:51               Does the technology work? Does the business model make sense for a for profit business? Does the business model make sense for smallholder farmers? So can we make money? Can they make money and does this whole thing work? And it was, yes. I called my partner in PWC and quit from here. Charlie called his dean and said, hey, I’m not coming back. Went back, packed our bags, begged everyone we could ask for, for loans and then got on a one way flight.

Sam:                                      00:15:20               Was the company called Sunculture?

Samir:                                   00:15:21               It was.

Sam:                                      00:15:21               Yeah

Samir:                                   00:15:22               But we only had the website, Suncultured, with the ‘d’ at the end because Sunculture was taken, so we had to negotiate for that.

Sam:                                      00:15:30               Really?

Samir:                                   00:15:30               Yeah.

Sam:                                      00:15:30               What was the initial, the original sunculture.Com doing?

Samir:                                   00:15:34               I don’t know. There is a sunculture band who if you’re listening to this, we’d love to meet you.

Sam:                                      00:15:39               A Sunculture band.

Samir:                                   00:15:40               There’s a band called Sunculture in the US that has, I think the Twitter account and maybe the Facebook account, but we would love to meet them. They’re like a small band that I think, I mean, I listen to music. It’s pretty great. Yeah. I should reach out to them.

Sam:                                      00:15:52               What type of music is It?

Samir:                                   00:15:54               Like indie rock.

Sam:                                      00:15:56               Yeah.

Samir:                                   00:15:56               I should reach out. Maybe I’ll do that.

Sam:                                      00:15:58               Yeah. Cool. Okay. So that’s Cool, then you land here and you’re like we’ve got to like make this thing work

Samir:                                   00:16:05               First we have to figure out what we don’t know. I think there were like two characteristics that really helped us at the beginning days. One was we were super naive, like just uberly naive, which I think was really good quality at that time.

Sam:                                      00:16:18               How old were you at that time?

Samir:                                   00:16:18               23 turning 24 in a few months. Yeah. so I think the naivety inflated our confidence, which was really helpful for us to make the jump, but also this, we really knew, we didn’t know anything. We knew we could figure it out. We knew we had the resources, we knew we had this sort of base understanding to make this work, but we knew we didn’t know a lot about the problems we were solving. So we said, let’s spend the first seven months in field, First big mistake, putting our first pilot four hours away from where we live. So we would take the matatu up four hours and back everyday. Ended up getting a car driving up and down.

Sam:                                      00:16:56               What was the logic? There must be some logic to doing that.

Samir:                                   00:16:58               It was the first farmer that we had met because we met one of his relatives in the US at some point and said, we need to find a farm to pud a demo on. It was a great way to get to know each other, Charlie and myself. Great way to get tour the country.

Sam:                                      00:17:14               Yeah.

Samir:                                   00:17:14               But I do think if I would go back and do it again, I would put the first demo much closer, which we did for the second demo.

Sam:                                      00:17:19               Yeah,.

Samir:                                   00:17:20               Only 45 minutes.

Sam:                                      00:17:21               And the reason you made that choice was just like, here’s an opportunity. Like we should just take it.

Samir:                                   00:17:25               We just need to put something somewhere and see what happens. But we didn’t know how the, we didn’t understand the day to day lives of smallholder farmers. So we needed to put the system in the field and see what the farmers touched, what would be potential break-points, what questions they had, where they needed help, where the tech may not serve them very well. We always say that the farm is our lab. So even when we roll out new products, it always starts with our customers. What are your problems? What do you need? What don’t you have? How can we help you? And I think that’s one of the founding principles that have allowed us to grow into what we’ve grown into right now.

Sam:                                      00:17:59               Yeah. Okay. What was the name of your first farmer?

Samir:                                   00:18:02               Our first farmer. Sirma.

Sam:                                      00:18:04               Sirma.

Samir:                                   00:18:04               And then the second one was Peter.

Sam:                                      00:18:07               Sirma and Peter. Did they know each other?

Samir:                                   00:18:08               They did not. They were very far.

Sam:                                      00:18:11               Okay. Alright. So what was, what was the deal with like when you went to Sirma, what did you say?

Samir:                                   00:18:16               We met, we met one of his relatives in the US.

Sam:                                      00:18:18               Yeah

Samir:                                   00:18:19               Well this one was easy. We’re going to give you something for free just to see if it works. That was the first one. We don’t like giving things away for free. We often don’t, the reason we gave these first two products for free was because it was really a product we need, needed to test the product. So the first two farmers was very much product r and. D. Then we started selling stuff to people. So the sales pitch for these guys was really easy. We’ll give you free stuff. Let us come to your farm whenever we want, let us try stuff and then you don’t have to pay us. There’s your birds, dinner time.

Sam:                                      00:18:53               Do you remember the first time you went to a farm when you asked them to pay you?

Samir:                                   00:18:57               Yes.

Sam:                                      00:18:57               What was that like?

Samir:                                   00:18:59               Amazing. Oh, we got so excited.

Sam:                                      00:19:04               Paint a picture. So like, were you like planning up to this day or was it like, it just kind of happened? What was it?

Samir:                                   00:19:09               It just kinda happened. We realized one day we were running out of the money we borrowed like, man, we really need to start selling some stuff. We didn’t know how to raise money. We didn’t know what grants were. We didn’t, we didn’t know how to raise capital at the time. We didn’t know that there were organizations that were built and created to just support us. In the early days, we didn’t understand.

Sam:                                      00:19:31               Okay

Samir:                                   00:19:31               We understand it now. But were like man, we really need to start selling some stuff, otherwise we’re going to run out of money. So we started marketing and started calling people and used Facebook.

Sam:                                      00:19:40               When you say calling people, is it like calling up farmers?

Samir:                                   00:19:43               We used Facebook to get warm leads and then we’d call them and try to sell to them.

Sam:                                      00:19:48               So the phone was on Facebook?

Samir:                                   00:19:49               Yes.

Sam:                                      00:19:50               Like Facebook groups?

Samir:                                   00:19:51               Yes. We have one of the top hundred Facebook pages in Kenya. Yeah. We have something like 160,000 people on our Facebook page. Our posts get a million views.

Sam:                                      00:20:02               Really.

Samir:                                   00:20:02               It’s amazing. It’s, it’s, and it was, it was born out of just our need and the cheapest way for us, our need to market, the cheapest way for us to Ab test. And it was at a time when people were starting to figure out that giving Facebook for free was a really great way to get people online in a really cheap way to get people access to information.

Sam:                                      00:20:22               So you, you were kind of like, there at the right moment and stake your claim.

Samir:                                   00:20:27               Yeah.

Sam:                                      00:20:27               Wow.

Samir:                                   00:20:28               And Charlie has now developed a skill set in digital marketing. So we started just marketing on Facebook. Our first sale was to an organization called the Likipia wildlife fund foundation. It was an NGO and they bought three of our systems, one for this place called Rumuruti, one for Tigoni, one for Timau out on Likipia.

Sam:                                      00:20:50               Yeah.

Samir:                                   00:20:50               I remember sitting at the, at their office, which was in Nanyuki at the airstrip, like quote unquote closing the deal. And I remember the first check that we got, it was like something happened. It was a whole mess. We really wanted the first check. We wanted to have our first sale. Car broke down on the way down to drop it off to us. We sent someone to go pick it up and I remember having the check in my hand and like Charlie and I were just like yes.

Sam:                                      00:21:17               Physical piece.

Samir:                                   00:21:17               It was a physical check for three systems. We went and cashed it, not cashed it, deposited it. That was a big day for us.

Sam:                                      00:21:25               So much more symbolic.

Samir:                                   00:21:25               So much more symbolic. It was amazing. It wasn’t a transfer. Yeah it was a check. It was a physical check that we picked up and like we had in our hands. It was super symbolic. I think symbolism is important. Yeah, it’s important. Definitely. That was a big one.

Sam:                                      00:21:38               How much does it for?

Samir:                                   00:21:39               A little over 10 grand.

Sam:                                      00:21:41               USD?.

Samir:                                   00:21:41               Yeah, it was a big one. It was a great for sale.

Sam:                                      00:21:46               Cause one thing I’m thinking is like if you’re making money off smallholder farmers who don’t have much money, like how do you get, how do you, how do you make money? Like in terms of just the transactions, like departments, transaction values and stuff like that.

Samir:                                   00:22:02               Build something people want, create value in their lives and they’ll pay for it. I think that’s one of, that’s one of the being a business that being a for profit business, our farmers really hold us accountable because if we don’t make stuff they want, they won’t buy it. If they don’t buy it, we ride a business. So we always sit with the farmer in the middle, solve problems for the farmer, they’ll pay for it. Yeah, the profile of our farmers certainly has changed from the $5,000 product to the $500 product. But we still have margins when we sell products. And if we figured if we can create value for a farmer, a farmer is willing to pay for it. We also finance for our farmers, so they have a, we have a program called pay as you grow. Yeah. You like the name? Cute?

Sam:                                      00:22:51               How long before you, how long did it take?

Samir:                                   00:22:52               It was really quick for that one really quick for that one. But our farmers pay us over 30 months.

Sam:                                      00:22:58               Did they get the joke?

Samir:                                   00:23:02               It’s not a joke.

Sam:                                      00:23:04               What I mean…

Samir:                                   00:23:04               Yeah. They love it and they love it. Pay as you grow. They love it. It’s like, oh, we’re growing. We’re going to pay over time while we grow. Sweet. Our, our main product is our flagship products called Rainmaker. Also, they get it. It’s like it’s raining.

Sam:                                      00:23:19               Yeah. Yeah. Have you got like, like a naming department? Where does this stuff come? Is this come from, it’s like, being there and just being like, what should we call our next thing?

Samir:                                   00:23:30               Pretty much. Yeah. We just had one of these naming conversations last week at our leadership meeting. We had to name a new pump that we’re coming out with and it was kind of going round the table and saying, what are we, what do we need? What’s the, what’s purpose of a name? It’s one for brand. For customer also for what we call it internally.

Sam:                                      00:23:48               Yeah. What’s it called?

Samir:                                   00:23:51               Can’t tell yet.

Sam:                                      00:23:52               Really?

Samir:                                   00:23:52               Yeah.

Sam:                                      00:23:53               Okay.

Samir:                                   00:23:53               Yeah. It’s just a larger version of a water pump for our internal uses. It’s not, this one isn’t a customer-facing one so far. It’s been just sitting around and then try and go with customers. So saying, you know, what do you think about this name? Because again, it really matters what a customer thinks. It doesn’t matter what I think. So we’ll come up with a name and then we’ll share it with customers and say, what do you think about that?

Sam:                                      00:24:12               They must all gravitate towards the rainmaker and all that.

Samir:                                   00:24:14               Same with colors and with everything.

Sam:                                      00:24:16               Yeah. Okay. What about your map? Make money. Okay. Make money. So, you’re now at $500-ish price point

Samir:                                   00:24:23               Yeah, we have, we have two products. We have about $1000 price point, $500 price point financed over multiple years.

Sam:                                      00:24:29               Okay. So how, what’s the initial cash cash outlay?

Samir:                                   00:24:32               $89.

Sam:                                      00:24:34               Are any farmers excluded from that?

Samir:                                   00:24:36               Of course. Absolutely. Yeah, there are, there will always be people that are excluded from what we can do alone. You know, their governments need to exist to provide welfare for people that, for profit businesses can’t necessarily do that too. Yeah. Now that may actually let me take that back. That might not always be the case. I completely take that back. So right now there are people that are excluded. The only way for this in all these businesses to work at massive scale and I’m not, I’m not talking about it’s scale for Sunculture to do well or other companies to do what I’m talking about its scale where you’re looking at like hundreds of millions of people, governments needs to get involved and the dorm likely of subsidies or smart subsidies. Then these types of products can be affordable and available for everyone. But until that’s in place and then it’s there, there will be people who are excluded from this.

Sam:                                      00:25:32               Okay. But there’s enough, I mean is it like I’m not, I’m not quite sure how to answer this question or ask this question, but I’m trying to think at $5,000. What percentage of your smallholder farmers market could your access? Like what does that…

Samir:                                   00:25:46               Much smaller market.

Sam:                                      00:25:47               But is it like a linear thing? Is there a particular drop offs wave?

Samir:                                   00:25:51               No, we, good question. In terms of like is it linear or not? I don’t, I don’t think it’s linear. Right now at a, between a 500, so at sort of a $38 or $39 a month, so between a dollar and a dollar 30 a month, there is a market of between one and 2 million farmers for us in Kenya alone.

Sam:                                      00:26:15               1$ and $2 a month?

Samir:                                   00:26:17               One and, 1$ And $1.30. So repayments of a dollar and a dollar 30 a day.

Sam:                                      00:26:26               Okay. Which adds up to about $30, $40 a month. About 40. Again,

Samir:                                   00:26:31               There’s, there is between and farmers that meet the criteria of having a water source, etc, about one to 2 million of those in Kenya. So there are enough farmers, it’s not linear. I think there’s much more farmers. There’s more than 10 times the amount of farmers available at this price point than they were at the $5,000 price point. Yeah. but there is a point at which you can’t make something cost less without sacrificing the quality of the product for the farmer. So we always say relevance and quality before affordability.

Sam:                                      00:27:03               Relevance and quality before affordability. Okay.

Samir:                                   00:27:06               So relevance in this case, let’s say you’re a farmer relevance is getting the right amount of water that you need from where it is.

Sam:                                      00:27:15               Yeah.

Samir:                                   00:27:15               So most farmers in Kenya have water between 20 and 50 meters. So it’s pulling that water enough water on a daily basis to satisfy your agricultural and domestic needs. So our water pumps for water from 70 meters.

Sam:                                      00:27:28               Got It. So you could do one for half the price, but it only does 20 meters and it’s not gonna be relevant to them.

Samir:                                   00:27:33               Yeah.

Sam:                                      00:27:34               So its got to work.

Samir:                                   00:27:35               It’s got to work. Yeah, its got to be high quality.

Sam:                                      00:27:37               And even it costs a bit more. We don’t care. Not really care.

Samir:                                   00:27:39               We don’t care. But we want to make sure. It’s, it works and it’s relevant and we don’t, you know, there’s a Strive Masiyiwa, so this is Zimbabwean entrepreneur. He was at the office a little bit ago and he said something along the lines of don’t build, don’t make condescending products. And that really stuck with me. You know, make products that people actually need and that they’ll use and it’s not, I’m going to give you this product that’s like, okay, just because you can’t afford anything better, make something better, figure out a way to finance it over time where the daily cost of ownership is affordable, but you extend the lifetime of the amount or you extend the terminal which they need to pay. There are ways to make really high, high quality products affordable for consumers that don’t have too much disposable income. I fully believe that.

Sam:                                      00:28:35               Yeah. Okay. So you sort of touched on a bit in terms of the financing in that, like there’s, it’s, you know, there was this, this time gap before you can, so you, you have the initial outlay of like you have to produce and manufacture the system and then you’re getting the money back in piecemeal. So there’s going to be this time period that you sort of mentioned a few times, you’ve taken on some external capital. Is that predominantly to fill that gap or is it, yeah. What are some of the main things that you’ve used? Your external capital for?

Samir:                                   00:29:09               Everything. I believe that different types of capital are needed for different parts of the business at different times. Okay. I’ll explain that. When we started the business, we raised grant capital to just operate the business. Now we raise grants for very specific pilots where we’re the first mover. Okay. So same type of capital grants, but not used to run the business used for very specific parts of the business. Yeah. We raise equity to grow and operate the business and now we raise debt to cover this period of time in which we need to order inventory before we get paid back.

Sam:                                      00:29:48               Okay, cool. Right, so you got four, these are the four. You got friends and family?

Samir:                                   00:29:53               Yeah, friends and family paid back. Okay. grant, capital equity, debt and equity from different types of investors. So our earliest investors were these angel investors, so folks that really believed in what we were doing and they have operating experience. They came in to be a bit more hands on and for the network. Then they raised some money for some vcs. They have a bit more institutional experience. Help us think a bit more about how do we professionalize what we’re doing. In the last year we raised money from the French utility EDF who have now come and helped us think about how do we, you know, how do we think about operations at scale?

Sam:                                      00:30:29               Okay. Do the these investors want different things from Sunculture.

Samir:                                   00:30:34               In terms of.

Sam:                                      00:30:35               In term of are certain investors feeling, I got into this because I want to see, let’s say financial risks. I know you can say ultimately, you know they’re all going to converge, but some might say, I’m coming to this because I really care about the impact that comes from this. So I might be saying, I did this because I care about the scale that you get. I don’t really care about profitability right now. Others might be saying, no, we need to start making this a profitable business. And if it was, if we sort of build it down, I’d want to make sure that we sacrifice making money so that we can impact more farmers. Whereas other people might be saying, right, this is a profit making business. We need to follow that way. Yeah, here’s any, this is all conjecture in my head. I’m joining you have any of those?

Samir:                                   00:31:23               Oh that, that’s a very valid question. We’ve been very careful about putting the group of investors that we have together and we have a group of investors, so the angel investors, the vcs and sort of the strategic institutional investor that all want to make money and make impact and don’t think you need to necessarily separate those because to make impact at scale, you need to have a sustainable business. But we won’t. And our investors won’t sacrifice making money or building a business that’s profitable to necessarily reach more people because we don’t always think reaching more people or selling more widgets is the only way to look at impact. And when Charlie and I first met, it was because his best friend growing up was dating a good friend of mine from university. And I was hosting an event at NYU where I was at school to bring together entrepreneurs all over from, from New York City. He came to the event late of course, and he ended up at that event meeting some guy who really influenced the way that we can describe impact. And it’s, we look at it as sort of the, it’s called a cube of value. So how many people can you impact? How deeply over how much time number of people is just one dimension of that. And we look at how do we maximize the of value. So we don’t necessarily look at impact in terms of reaching as many people as possible. We look at impact in terms of how do we increase that decreased volume, right? One way could be fewer people, deeper impact, quicker time. One could be more people, longer time, shallower impact. There’s just a lot of ways to put that together. We just want to increase that area. And that changes with the available technology, with the regulations, with types of partners. And that, that changes just with, with the environment in which we operate. So we look at how do we increase that, that cube of value, but doing it by building a profitable business.

Sam:                                      00:33:37               Okay. Have there ever been arguments, argument might be a bit strong disagreements between the direction the company should go in based on some of these things?

Samir:                                   00:33:47               Not based off of impact. But certainly there, there certainly have been disagreements. And I, I think that that’s healthy in terms of direction types of farmers we may need to serve markets we want to enter. But that’s, that’s good. It’s healthy having a lot of different perspectives on the table. It’s healthy. Where we draw the line is when people would ask us to serve a specific market without any reason other than we want you to serve a specific part of the market. So if someone says, we want you to sell a product at this price point to which these people, we draw the line, there. Some investors have specific mandates around that

Sam:                                      00:34:28               Really. Like what they’d have a mandate that we need to, they’d need to, they’d be an investor. That’s mandate is we need to sell cups at five shillings in this area.

Samir:                                   00:34:39               You know when, when funds are created, they’re created with specific mandates and those mandates are then used to raise money from their investors and when they invest in companies, they need to invest in companies that reached certain mandates. That was just an example, a very specific example of what it meant. It could be. Now people’s mandate could be we need to reach this portion of the population or x percent of our invested investments need to go towards this type of people, which is, which is very okay for us because we have a different view of impact, sort of this Cuba value. We don’t work with folks who say we have to serve these, these types of people at this price point because impact is a little bit more robust than that.

Sam:                                      00:35:24               Yeah. Okay. That makes sense, you said that some of the grant money you’re taking at the moment is too wet to do things that you’re the first people doing.

Samir:                                   00:35:33               Yeah.

Sam:                                      00:35:34               That sounds quite cool. That’s quite cool. How do you, how does that, at who, who leaves it, he leads the discussion there do you, are you kind of like, cool, we’ve got some fun stuff that we can do. You know, let’s go out and find some grants or do the grants out the grant. People like going, we need someone to go out and do this and you’re all working, which, which normally leads to the other.

Samir:                                   00:35:54               Normally the first one.

Sam:                                      00:35:55               Okay. So normally, you’re like.

Samir:                                   00:35:57               We have something called the find the right partner for it.

Sam:                                      00:35:59               Okay.

Samir:                                   00:36:00               Often times donors will have these open calls for specific programs. Yeah. We won’t raise grants to do stuff that we wouldn’t already do ourselves. Yeah. And that’s where you can get in trouble because people, when money’s in sort of available or in your face some people can get into trouble by saying, I’ll bring on this capital to do x, even if x wasn’t part of my plan. So we first say, what is it that we want to do? And then what’s the right type of capital for us to achieve that? And then we go and find partners to satisfy those capital requirements.

Sam:                                      00:36:41               Have there been any interesting grants that you’ve won?

Samir:                                   00:36:43               Oh yeah. Many.

Sam:                                      00:36:45               What are some of the ones you like.

Samir:                                   00:36:47               I mean, we’ve run grants from a number of different organizations and you know, we wouldn’t be here today without grants. And it’s really interesting when you look at agriculture and energy and other markets around the world. Sectors are very heavily subsidized by governments. And you know, the donors that come in to work with private sector companies like us are sort of filling, filling the gap of, you know, how do you work with organizations that have a first mover disadvantage where you’re testing new ways to achieve what would be national priorities as well. But that hasn’t, the solutions haven’t existed yet.

Sam:                                      00:37:28               Yeah.

Samir:                                   00:37:28               So we’ve, we’ve raised money from a number of governments. Right now we’re actively working with Microsoft to develop a very cool software platform. We worked very actively with the Shell Foundation for all the donors we haven’t listed. We really love you, but it’s a number of donors, right? It’s and for different parts of the business. You know, like USAID came in really early when we were looking at thinking of how to expand our business. The GSMA came and said that, we were thinking about building a new product and looking at financing, they were the first ones to take a bet on that. And throughout our history, there have been a number of organizations that have taken bets with us on things that have never been solved before.

Sam:                                      00:38:11               Like what?

Samir:                                   00:38:13               Like, how do you become the first company to commercialize Solar Irrigation Africa? How are you the only company to bundle these value added services and financing with this technology? How do you pilot the first solar irrigation financing scheme in sub Saharan Africa? How do you build a solar irrigation platform that’s 10 times cheaper than what you started with? How do you build a software platform where you are, you know, detecting agricultural risks earlier than anyone else on the continent. All of these bits and pieces that add to our business require capital to try. And there have been a number of donors who’ve come and said, look, we know you’re the first one to try this. We believe in this. Let’s try it. When it works, then you go and raise commercial capital. And we wouldn’t be here today without all of the donors that have supported us on this journey.

Sam:                                      00:39:01               Yeah, very cool, so kind of like, oh that’s not so I hadn’t really grasped that before. So it’s basically like giving you the safe space to fail. Yeah. Is what the, I mean a lot of the time that’s, yeah,

Samir:                                   00:39:13               Yeah, exactly. Try this out. We think that you’re right and we know that if you are right, you’ll go and raise commercial capital to then build that into your business. But it’s really, we’re going to be really expensive for you to try it out with equity or debt because if you fail, then you’re in a little bit of trouble. So let’s give you the capital to satisfy our development needs, which is trying to see your business work cause it’s impacting a lot of people. And then once that works, then you can go and raise commercial capital for it.

Sam:                                      00:39:41               Yeah. Very cool. All right. Yeah. Before we came over and sat in the garden you showed me, the, what you call the, the root and that, the sort of the living space that is representative of where…

Samir:                                   00:39:54               Oh yeah,

Sam:                                      00:39:55               Yeah.

Samir:                                   00:39:56               Demo home.

Sam:                                      00:39:57               That’s the one, one of them was the pressure cooker?

Samir:                                   00:40:00               Yeah.

Sam:                                      00:40:00               Can you talk to me a bit about that?

Samir:                                   00:40:02               To make it clear on what we make, what we don’t make, we only build sort of platform level technology. Okay. So in terms of the hardware, we built the control electronics for the energy management system, the battery that can power different appliances. We don’t make our own appliances because appliances exist and there are a lot of good appliances around the world. In terms of the software, we’re building a software platform where we can plug in other people’s data sources, but it’s platform level stuff. Our energy management system can handle appliances that were acquired 500 watts. So it’s a quite a large amount of power for folks living off grid. So we can power pressure cooker, electric pressure cooker. It’s quite interesting. A lot of our customers spend hours per day gathering firewood and/or charcoal to cook the number one cause of noncommunicable diseases in…

Sam:                                      00:40:52               Non-communicable.

Samir:                                   00:40:52               Like, so noncommunicable diseases are diseases that are not able to be transmitted from one person to another.

Sam:                                      00:41:07               So the, the number one non-communicable

Samir:                                   00:41:11               The number one cause of noncommunicable diseases in Kenya. And I don’t have to start a sub Saharan Africa, I definitely not it’s for Kenya, is cooking for like a non clean cooking. Okay. So if I were charcoal in the house, yeah. So pressure cookers or something that’s quite interesting for our customers because they saved time and they, it’s much, much healthier for them.

Sam:                                      00:41:32               Yeah.

Samir:                                   00:41:34               So we started piloting pressure cookers. We haven’t commercialized it yet. Yeah. But it’s one of those appliances that we would be happy to have as an add on after someone increases their income with the solar irrigation. And then how do we continue to make them more productive either by saving their time, making them more healthy, etc.

Sam:                                      00:41:51               So what’s, what’s the, what’s the big sell with a pressure cooker? So,

Samir:                                   00:41:54               So let’s say you live in rural Kenya, you spend a few hours a day cooking. Yeah. So if I could cut that time by 70%, then you have more time to do other stuff. Plus I’m making sure you don’t bring in all, you don’t breathe in all these nasty fumes, your grand-kids don’t breathe in all these nasty fumes keeps you healthier.

Sam:                                      00:42:11               Yeah. Gotcha. Okay. What some of the other so what the, have some of the devices that we have in there?. So there’s a TV…

Samir:                                   00:42:19               There’s a TV. So even to answer this question more broadly too, I’m going to ask myself the question, how do we choose appliances?

Sam:                                      00:42:27               Sumit, you want to come and take my…

Samir:                                   00:42:31               Kicking you out of business over here. We run focus groups with farmers. We’ve done focus groups with hundreds of farmers this year, to help ourselves figure out what appliances farmers would want after they increased their incomes. TV’s interesting. Bundled with agriculture content to help people learn about farming. There’s a lot of other potential appliances that are used for agricultural productivity and increasing productivity at a domestic level. So saving a lot of time, making people healthy. Can’t share all of them just yet. In the House we’re showing egg incubators, which is very interesting for us as well.

Sam:                                      00:43:13               Egg…

Samir:                                   00:43:13               Egg incubators.

Sam:                                      00:43:15               Egg as in chicken egg?

Samir:                                   00:43:15               Chicken egg.

Sam:                                      00:43:16               Not ag?

Samir:                                   00:43:17               Not ag, egg, egg. I’ll have some more water so you can more clearly, egg incubator. So people will hatch eggs in egg incubators and then sell day old chicks. So there’s a large market for people to buy chicks that are a day old, then grow them and then sell them or grow them for more eggs. But there’s a big market for people to grow hatched chicks and then sell them. It’s wild.

Sam:                                      00:43:46               I was thinking more in terms of like this device, this machine that is the egg incubator. Is like quote quite a well known thing. What I’m trying to get is there a sense of you don’t know what you don’t know when you go, when you do focus groups?

Samir:                                   00:43:56               Partly we show a lot of, when we do focus groups, we have a number of products, we go in and we use and we show pictures of and then see how people ranked them based off of a number of factors.

Sam:                                      00:44:08               Okay.

Samir:                                   00:44:08               So we’ve a very specific way of running focus groups to make sure we’re making it feel as real as possible with the amount of money you have. How do you make money? If you use this, you make more money here, how would you invest it to really get a sense of what people would actually invest in? Yeah, so sometimes you know for incubator, for example, if someone hadn’t seen it, they understand what it’s used for, they go, wow, that’s really useful. I didn’t know I could ask for that. Yeah. So we go with pictures and we describe it because you know sometimes it’s hard to even ask for something you don’t know is available.

Sam:                                      00:44:36               Yeah. What, honestly, what sort of, what have you found have been some of the important bits of information you do you share when doing this focus group that you might not have done the first time?

Samir:                                   00:44:49               So one of the really important pieces is helping people understand how much money they can make from it and how much money they would be spending without it. Which sounds really obvious, but it’s just taking time to really put that in writing. Hey, you can make this much money or having them figure it out themselves. So if you had this product, what would you do with it? How much money would you make from it? How much money would you be willing to invest in it? So just taking time and having them walk through their own process as opposed to telling them what they could use it for. Right. It makes it more real. It makes it more personable. And also it’s just the right way to do things is to allow people to understand how they would use it for themselves as opposed to you telling them how they should use it. You know, when we started the business, I told you the V1 was a big solar powered water pumping system and drip irrigation altogether. The gold standard. We realized that trying to sell and force people to go for the gold standard right away, it’s not, it’s not the best way to do things because it requires so much behavior change and so much investment. Instead we change our approach to say, look, instead of going for the gold standard, why don’t we start you off with a solar powered water pump and a sprinkler and/or a hose pipe, which requires very little behavior change and then upgrade you to drip irrigation and then upgrade you to bigger drip irrigation, etc, over time. So getting you to the gold standard, but over multiple years as opposed to saying, you have to do this now. When we first started, we said, you can only buy this package and that was wrong. And we broke up the package and allowed people to mix and match based off of sizes, based off of what their needs are, what their comfort level is. And instead of trying to determine what is best for our customer, we show them our customers, the option, allow them to decide what’s best and then kind of graduate them. So we took, we expanded the Lens in which we look at our customers instead of a sort of a one year lens, we now have sort of a longer 20 year Lens. So we go through the exercise of, you know, what our customers need over the next 20 years and how do we serve them over the next 20 years.

Sam:                                      00:47:00               I see. Okay. So one thing I’ve, I’ve always sort of wondered about smallholder farmers and sort of productivity, etc, is by funding. You can obviously enlighten me a bit more on this, but if Amazon.

Samir:                                   00:47:15               I’ll be your guru on this.

Sam:                                      00:47:16               If Amazon are getting more productive from their plot of land, is there a limit to productivity they could get. Whereas if they kind of combined together and kind of did more, more of a commercial farming thing, you might get the economies of scale and that would make things even more productive.

Samir:                                   00:47:36               How much time you have? So it’s, it’s a, if you look at countries like the US, where you had over half the population operated on farms or farmers and now single digits, just a few percent of people are farmers. One of the bigger reasons for that was farm aggregation. One of the reasons why people aggregated farms in the US a hundred years ago plus was because in order to mechanize your farm, so to use machinery to do work that humans would take too long to do or would do it ineffectively, you had these really expensive machines. So it was not, you were not able to be, to have a profitable small farm that was mechanized because the machines cost too much. Right now we can mechanize 1/16th acre farms profitably. So there doesn’t need to be aggregation as there were in other markets around the world because we now have technology that can be that, that we can sell to really small farmers where we don’t need to have big masses of lines. So that’s one thing we don’t need to aggregate. Of course you can achieve economies of scale when you aggregate, but you also have to look at the farmers that we talk to, don’t want to give up their land because traditionally land is passed down to your children and then to your children and then to your children. And that is an asset that you own. And culturally it’s a, it’s an honor to have that piece of land. Our customers tell us that they wouldn’t want to aggregate because that’s, that’s theirs, so there’s, there’s also a cultural bit and cultures differ across different regions in Kenya as well. But across the regions that we work in, which are most regions in Kenya, our customers say they wouldn’t want to aggregate. This is their land. It’s for their family. They want to use it that way. So my philosophy, my theory is that there won’t be aggregation at a farm level and we need to figure out how to make farmers profitable on an individual level.

Sam:                                      00:49:46               Solid answer. Done. Yeah. Good. That’s good. Alright. Sleep easy right now. All right. Supply side. Yes. You’ve spoke a lot about demand side. So you’ve got this platform and then you basically….

Samir:                                   00:50:03               What a good Buzzword Huh?

Sam:                                      00:50:04               Isn’t it?

Samir:                                   00:50:04               Yeah. It’s how, how, how do you use the word.

Sam:                                      00:50:07               How quickly was that on your pitch decks?

Samir:                                   00:50:09               Not so quickly, not so quickly.

Sam:                                      00:50:11               Right.

Samir:                                   00:50:11               We don’t like using buzzwords for buzzwords sake. We’re like very anti that.

Sam:                                      00:50:16               How else do you, if you don’t, if you weren’t allowed to call it a platform, what would you call it?

Samir:                                   00:50:20               Which part of the business?

Sam:                                      00:50:22               The bit where different manufacturers can, you get different products, which can all go through the Sunculture system.

Samir:                                   00:50:31               I don’t know.

Sam:                                      00:50:32               Maybe it’s a platform, maybe that’s the word.

Samir:                                   00:50:33               It is definitely a platform, it’s definitely a platform.

Sam:                                      00:50:36               Yeah.

Samir:                                   00:50:36               You hear people talk about X platform Y platform.

Sam:                                      00:50:40               Yeah.

Samir:                                   00:50:40               And really all it is is their way of doing things.

Sam:                                      00:50:45               Have you ever just found yourself not necessarily as the Uber for x, have you ever described yourself as, the something for something?

Samir:                                   00:50:52               We, we haven’t but, and you know those, those kind of analogies are useful in some ways but also really detrimental in other ways because it’s really hard to put us in a box because we touch so many sectors, water, energy, food, Fin-tech, IOT. Again, more buzzwords, but in all parts of what we do and people like to put us in certain boxes. So it’s hard for us to say where the, you know, the A for B. One thing that we have thought about a lot, and it’s how we use our, we did a re-branding, how we define our core values as a business. Part of, part of how we define our core values has looked at how apple has designed products for its customers and how apple has the purchasing trust of its customers like me and how apple is reliable in terms of its servicing. You always find someone smart at the genius bar or on the phone who can help you solve your problems. But really putting the customer at the center of it’s product design strategy. We’ve often, we’ve, we’ve talked about that internally, so we want to have the best products that can satisfy our customer needs. Then that we have the purchasing trust of our customers because of the quality of the products and services that we offer.

Sam:                                      00:52:25               Apple for smallholder farmers, no I’m joking. Yeah, I’m one day people will be saying.

Samir:                                   00:52:31               I have my black turtleneck inside if you want me to go, pull that out.

Sam:                                      00:52:36               And one day people will be the Sunculture for X.

Samir:                                   00:52:39               I hope so. Yeah, I hope so, I hope, you know, I hope we are breaking a lot of the rules that people think that you have to follow and I hope that we’re showing that, you know, you don’t have to do things the way other people do it. One of the hardest things to do when you start a business is to not emulate people, especially in markets where things haven’t been figured out and where there are a lot of people to look up to. It’s really important to understand that, you know, your business is different, you’re different, your customers are different and don’t emulate. So hoping that we can break the…

Sam:                                      00:53:10               Is that?

Samir:                                   00:53:12               I don’t know.

Sam:                                      00:53:14               Maybe it’s a cat. We’ve got, we’ve got.

Samir:                                   00:53:16               Theirs, there’s a cat. And then there’s dog, dog, two dogs. There’s monkeys around here as well. So I dunno what…

Sam:                                      00:53:26               We’re in a residential area?

Samir:                                   00:53:27               We’re in a residential area. Yeah. It’s nice. It’s, this used to be a daycare.

Sam:                                      00:53:35               Really. It did look a bit colorful.

Samir:                                   00:53:37               Yeah. If you see the playground in the front, yeah. You can use it as well. As one of my mandatory requirements was to keep the playground here. So, yeah.

Sam:                                      00:53:48               So we talked about supply.

Samir:                                   00:53:50               Yep.

Sam:                                      00:53:50               And I said, I thought I thought supply was your platform, but maybe it wasn’t like what, what, what would you say is the supply? What is your, when you think of the supply side of your business, do you not think about it?

Samir:                                   00:54:00               No, we think about it a lot Something we’re very good at. It’s one of our core competencies. My co-founder and his, his R and D team can look at sort of China as like a Walmart. He knows where to find everything, knows how to test everything. We’re very good at the supply side. Very good at sourcing. Very good at quality assurance. Very good at quality control. Have I told you that we got on a way flight here, when we left New York, we first stopped in China.

Sam:                                      00:54:25               Okay.

Samir:                                   00:54:26               So we have very good relationships with our contract manufacturers, our suppliers with our manufacturers as well.

Sam:                                      00:54:31               Yeah. So they’re making stuff few.

Samir:                                   00:54:35               So sometimes we buy off the shelf stuff. Sometimes people are making stuff for us. We make some of our own stuff so we make our own the controller electronics, the green board, the PCB, we make our own. Yeah. And which allows us to power all these really high powered appliances from different parts of Asia. And then we do our own sort of assembly and we send it over here. And then we do the own, we do our installation, we do the installation for our farmers on their farm.

Sam:                                      00:55:04               And this is done, is that from the sales agents?

Samir:                                   00:55:06               Done by engineers. So we have sales agents and we have engineers across the country that do the installation. And then the repairs and maintenance.

Sam:                                      00:55:14               Do you have like little hubs?

Samir:                                   00:55:15               We do, we do, we call them sales and service centers. Sscs centers. Sscs yeah. You can say it seven times.

Sam:                                      00:55:22               Sales agents. They’re kind of a locus around those.

Samir:                                   00:55:30               So our sales and service centers actually trail our sales agents. So they go in areas that we start to saturate and then they stock spare parts. They’re used for good branding point of sale. But if we don’t have a sale service center in the area that need spare parts, we send them directly and we have engineers and go and do all the repairs and installations. Yeah.

Sam:                                      00:55:52               Who’s your star salesperson?

Samir:                                   00:55:53               We have two right now, Olivia and Margaret. Okay.

Sam:                                      00:55:56               What, what makes them so good?

Samir:                                   00:55:58               They, well we, we had a town hall last week. We do a town hall every quarter and we’re sort of going over where, where we’ve come from. These two women together sold more units, like more than, together they sold more than half of what we sold in our whole first year and they sold that in like Q2 this year. I haven’t been able to dig into why they’ve been so good.

Sam:                                      00:56:25               Do they work together?

Samir:                                   00:56:25               Separate, independent yeah.

Sam:                                      00:56:28               Are they different personalities?

Samir:                                   00:56:29               So this is my first time meeting them in person.

Sam:                                      00:56:31               Okay.

Samir:                                   00:56:33               Different personalities for sure. Yeah. Both very confident, very competent. We find that sales agents that, that are sort of, that understand that this is just generic for everyone, but it’s so true. It’s that if a sales agent understands the challenges that their customers go through, that they become really good sales agents because it’s not even a matter of selling someone. It’s a matter of serving someone. So I always tell people we’re in the service industry, we exist to serve our customers. As you grow and as you have a bigger sales organization, it gets, it gets hard to often have that message go through to every new person that comes on because they want to hit numbers and make commission. But the best sales agents that we have are ones that understand that they’re here to serve our customers. And both Margaret and Olivia, when I met them last week, they both came off and had sort of, they had the empathy to be able to understand where our customers went through and were very humble about their work. And sort of didn’t say this directly, but you kind of picked up that they were sort of, yeah, well we’re here to help our farmers. That’s all we’re doing is helping them out, which is really cool. Which is, you know, what you want to hear, which is I had my dream to hear that from everyone. Yeah.

Sam:                                      00:57:52               What’s your sales cycle?

Samir:                                   00:57:54               So, so different, so different. I mean, most, most people are quite quick.

Sam:                                      00:58:04               Quite quick like…

Samir:                                   00:58:04               Within the month.

Sam:                                      00:58:05               Okay.

Samir:                                   00:58:06               Some people, we have people calling after hearing about us for a year.

Sam:                                      00:58:09               Yeah. How many visits will someone make?

Samir:                                   00:58:13               So we need, we need somewhere between four and six touch points. So it doesn’t necessarily mean visits. Could see us on Facebook, could see one of our agents get a few SMSs. We, we know that for us there’s, there’s, you need just a number of touch points as of now and that could change as we release new products. So we also found that our sales cycle and the way we need to communicate needs to differ based off of region, based off of product we’re selling. And there’s again, no silver bullet. You have to adapt to the needs of your customers. Some people in some regions want to see things in person, some people are okay buying it from their neighbors. Referrals work better in some regions. Different marketing channels work better in other regions.

Sam:                                      00:58:55               Quite a complex operation. Yeah. With all these different terms to factor and all these different…

Samir:                                   00:58:59               Yeah. But it’s so interesting. Yeah. It’s so interesting and being able to filter all this into a system that works. It’s super defensible too because if you systematize this and you, you know, we’ve, we’ve really strongly moved from an intuition led business to a data driven analytics led business and doing that has allowed us to systematize lot of the work that we do. So how do we systematize and put algorithms around digital marketing or about where we open up a new market or about our supply chain? How do we create a system that links our accounts with our after sales, with our, with our dispatches. Now that there’s a system in place, it’s fascinating because it’s so defensible. So working in markets that industries don’t exist for you to piggyback off of all these different pieces, it’s challenging, but if you can figure it out, it’s quite, it’s quite a defense. It’s quite a moat.

Sam:                                      00:59:52               Yeah, I can see that. What are the main hires you’re looking to hire for next?

Samir:                                   00:59:59               Only people that are front lines right now. So we have, I think the best team come the Dream Team. So we had the dream team.

Sam:                                      01:00:08               I saw there was a little sign that said teamwork makes the dream work.

Samir:                                   01:00:09               Teamwork makes the dream work.

Sam:                                      01:00:10               So they’re clearly listening.

Samir:                                   01:00:11               Clearly listening. Yeah. Our, our head of HR, Joanne, who’s a superstar, she has this she has this sweater that says Dream Team on it. We, we, we pay attention to who we hire. And we have an amazing team. That’s just an amazing team. Now the only people we’re hiring are customer facing people. So sales agents, engineers, credit officers, relationship managers, people that have a direct interaction with a customer.

Sam:                                      01:00:38               To what degree do you attribute the fact that you’ve been able to assemble a dream team? Because one thing is my hypothesis, it’s like obviously partly be yourself, but the fact that you’re doing quite a cool business that people can feel inclined to.

Samir:                                   01:00:54               Unless you’re gonna post something about my phone. I’ll answer that question. I’m going to ask myself another question as well because I think it’s quite interesting.

Sam:                                      01:01:01               It’s a better question than I’ve asked.

Samir:                                   01:01:02               No, it’s not a better question. It’s just something that I, I thought about what we san pull this up. So I send out a, one of my monthly emails. There’s been,

Sam:                                      01:01:14               Is this an internal email sent?

Samir:                                   01:01:16               Internal email.

Sam:                                      01:01:17               Are they, do they have fun name like Sumir’s monthly email?

Samir:                                   01:01:20               I always put a nice, there’s a subject for all of them. With an Emoji.

Sam:                                      01:01:26               What was the emoji this time?

Samir:                                   01:01:26               For June. June was a target. The target Emoji, cause we were talking about targets. May was a trident.

Sam:                                      01:01:36               A trident?

Samir:                                   01:01:36               That thing.

Sam:                                      01:01:39               Oh yeah. Like oh the thing that Zeus has.

Samir:                                   01:01:43               Yes.

Sam:                                      01:01:45               What’s the, what does the trident symbolize?

Samir:                                   01:01:48               So the subject of this email was ‘gyshido’ which stands for get shit done. We work with an organization called Unreasonable and they have this ‘gyshido’ policy about how to get shit done. And I was reflecting in this email on sort of three key factors that have got us to where we are and that I see in all the most successful people on our team. One of them is the hustle. Yeah. So we have a lot of folks who are just super hungry getting an MBA on the side of working you know, managing team from home, asking for mentorship, just the hustle people who are really hungry for, for development resilience. So people who really believe that, you know, the craziness is going to work, that being resilient to the words and they say are seeing the light where other people don’t. That’s been a huge factor. And then putting the company over self. So, you know, putting the purpose of our work ahead of their personal beliefs or ahead of their personal benefits. That’s something that’s really, really key. The thing that, that would, the reason I had the trident was because the one, the one factor that our lowest performers lack is this ‘gyshido’ so get shit done. So the trident was kind of like, Eh! Get shit done. Yeah, that was the closest thing. I didn’t want to put a poop Emoji. This felt more, more get it, getting done. So those are, those are the factors that have contributed to the highly successful people in our organization. I think the reason we’ve been able to assemble the dream team is that we, I mean, we’ve just from day one, Charlie and I have always put our customers first. We’ve always said that increasing the productivity and incomes of our customers has been the most important thing and that we just embody it. We’ve always had that philosophy, always put our customer first. We’ve always been very clear that we will not sacrifice quality and relevance for affordability. We will figure out ways to make things affordable with operational or manufacturing efficiencies or financial innovation. We’ve just really kept true to our core beliefs. And I think that the, you know, trust is consistency over time, right? So I think we’ve just built trust that we are consistently living our core values. And I think people like that, and people trust that no matter what, when shit hits the fan one day or when things get really tough, that we’re going to live our core values and we’re not going to sacrifice what our purpose is as an organization for anything. And I think that that’s what, how we’ve been able to attract the dream team and those people who believe that and embody that have been our most successful folks in the dream team.

Sam:                                      01:04:32               Yeah. So a few more questions. I realize Samir, we’re already on the longest interview I’ve ever done.

Samir:                                   01:04:37               I don’t know if that’s a thing to celebrate or not, but I’ll celebrate it right now.

Sam:                                      01:04:43               So six months to the, in the next six months to three years. Yeah. What does Sunculture…

Samir:                                   01:04:49               Six months to three years, come on, man. I’ll do both.

Sam:                                      01:04:56               Okay.

Samir:                                   01:04:56               But I won’t do, I’ll do both separately cause they’ll look different. So six months we’re raising around a funding right now.

Sam:                                      01:05:04               What type of funding?

Samir:                                   01:05:05               Equity.

Sam:                                      01:05:06               So this is people saying we’re going to take a percentage of Sunculture.

Samir:                                   01:05:10               Yeah. For capital with a belief that we’ll get paid back a lot more in time.

Sam:                                      01:05:18               How much are you promising them?

Samir:                                   01:05:20               We’re not, We’re not. We’re good. We don’t share. We won’t, so I won’t share how much we’re raising or what we promised them right now so just in case you have any more questions on that.

Sam:                                      01:05:32               It’s like this is a, people who are, they obviously will care about the impact.

Samir:                                   01:05:36               Yes.

Sam:                                      01:05:37               But they are also…

Samir:                                   01:05:37               Commercially minded impact investors who have a vision to, who have a vision that matches our vision. Yeah. So to scale this business across multiple markets to affect as many people as possible, to grow what we think could be the most meaningful sort of agriculture business on the continent. And then at some stage go to different continents. So raising that, so in the next six months, get that closed. The next six months looks very much like it does right now. Just more like the machines running in more areas in Kenya. So just more sales agents, more and more people that are customer facing. So just where we’ll grow in terms of people are feet in the street, foot soldiers serving our customers. So you know, that that’ll grow up quite a bit. We’re distributing in a few markets or we’ll distribute in a few more markets and just, it’s just growing our current operations. So nothing totally new, just kind of growing current operations. In three years time we might be operating in one or two new markets. So not only growing what we’re currently doing, but replicating what we’re doing in more markets. We’re working on some really good software stuff, some really cool software stuff. Where, we’ll be able to highlight risks that farmers face that are not in their control much more visibly in real time, which means that, you know, we can help course correct for farmers. So give hyper local recommendations on pest mitigation, how much fertilizer to use, irrigation recommendations. So we, we always talk about bringing the best in best in class precision agriculture, smallholder farmers, which we’re doing. This is just a huge extension on that on the software side. So in three years really, really commercializing that software piece to then crowd in more capital, more insurance companies. More input companies, more product companies to serve farmers. So building the most robust fin-tech platform and marketplace for smallholder farmers because we have all of this information.

Sam:                                      01:07:42               Yeah, and you built the trust with the farmer.

Samir:                                   01:07:43               We build trust with and we built trust with the market as well.

Sam:                                      01:07:46               Yeah.

Samir:                                   01:07:46               You know, I think the reason why people don’t invest in smallholder farmers is because they don’t understand the risks that are, that smallholder farmers have. If the risks are visible, then insurance companies can price the risk with the premium and then banks will insure and put an interest rate on it, which is pricing a risk as well. So if we can help make the risks visible and then help help give farmers advice that helps them make better decisions on how to mitigate against those risks, then they have access to more capital, which allow them to then go buy more products and services. But again, solar irrigation isn’t a silver bullet. They want stuff. They need stuff like pressure cookers TVs, more machinery, more inputs. But we can help serve as a platform to again, increase and protect the productivity of smallholder farmers and help them mitigate risks not in their control. And then highlight how we’re doing that so people are comfortable selling to those customers.

Sam:                                      01:08:41               Sounds very cool.

Samir:                                   01:08:42               Yeah. Thanks. I think so. Yeah.

Sam:                                      01:08:46               10 years?

Samir:                                   01:08:48               I don’t know if I’m going to be the right person run this in 10 years. Okay. I don’t know. I don’t know. I might be. I very well might be, but different size businesses need different personalities. I always tell the team what gets us from zero to one won’t get us from one to a hundred, which is the same. Won’t get us from 100 to a thousand. That means people, that means systems, that means processes. And maybe I can develop or maybe I had the skill set to manage the company where it’ll be in 10 years, which will be on multiple continents. But maybe I won’t be. Yeah, maybe I’ll be doing the next cool thing. Who knows? But Sunculture will survive that.

Sam:                                      01:09:29               Yeah.

Samir:                                   01:09:30               I’m building Sunculture to survive well beyond me and that’s, I keep telling everyone as well. Keep figuring out how to fire yourself out of a job.

Sam:                                      01:09:40               Yeah.

Samir:                                   01:09:41               So if you can fire yourself out of your job, it means we’re growing. So I continually, continually try to fire myself out of a job.

Sam:                                      01:09:45               What did you fire yourself off of?

Samir:                                   01:09:47               Operations. Kenya operations. Our COO now runs Kenny operations and we’re hiring a Kenya GM to take over his role. So he’s fired himself out of a job. And now, that gives us space to think about how can we best, how can we best be used to help Sunculture grow? So it’s a good thing to fire yourself out of a job because it gives you space to think about what’s next. In 10 years, maybe the job I fire myself off, myself out of and where I need to go. Maybe that doesn’t fit. Maybe we need to bring in someone external, but Sunculture will survive well beyond me.

Sam:                                      01:10:23               Very cool.

Samir:                                   01:10:24               And again, I’m, I might be the right person and I’ll be here and we’ll be doing this podcast interview again. But yeah, check back in 10 years.

Sam:                                      01:10:33               Very good. And, and people who are listening, how can they learn more about Sunculture in various different ways?

Samir:                                   01:10:40               So you can listen to this podcast, which you already have so well in. If you want to see how we interact with farmers and how farmers think and how farmers feel check out our Facebook.

Sam:                                      01:10:54               Is that just Sunculture?

Samir:                                   01:10:55               It’s Sunculture Kenya. Our website is my least favorite thing right now. Maybe when you publish this it’ll be better. We’ll see. So if you go to our website and it’s like, Eh, then just wait a little bit. You can find more information there. Type in Sunculture in whatever search platform you use. Lots of articles, lots of videos. If you want to join us in our mission, you can reach out to me directly, Samir, [email protected], we’re I was looking for really talented people to either work with or collaborate with now or in the future. So if anyone wants to join our mission and join our work, please, please reach out directly. If anyone has any questions on how to do this, how to start a business in East Africa West Africa as well, reach out as well. We’re always trying to crowd in more really smart driven people because it’s going to take more than Sunculture to solve all the problems we’re trying to solve. We think we’re an important piece, but again, we’re not a silver bullet either. There’s going to, there needs to be way more companies that are started that work together to solve all of these problems. And we, we look at some of the challenges that we’re solving for smallholder farmers and we’re just one, one of many solutions that are needed to improve the livelihoods of these folks. So yes, so join us, we welcome you. And yeah, I’m happy to help in any way that I can.

Sam:                                      01:12:26               Awesome. Well Samir. Thanks so much.

Samir:                                   01:12:28               Thanks man. This was fun.

How the “Distributed Economy” thesis could revolutionise how we think about Africa’s development


This is a slightly different episode of The East Africa Business Podcast where  we’ll be covering a thesis around development.

When you consider how countries and societies have spurred economic growth it has all happened through urbanization.

Streams of people moving from rural livelihoods to populate cities where they would find a better life and more opportunities.

Underpinning all this was energy.

Opportunities and wealth are a function of economic productivity and in order to produce more, power is needed to run, say, factories.

Historically this has been generated centrally, in a power station and sent out via the grid.

This has favoured a society built around these central sources of power and hence led to the rise and growth of cities.

Azuri Technologies, however believes that this same path does not need to be taken in Africa


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



In this episode Conrad Whitaker and I discuss macro trends around the continent’s development,how off-grid solar can change the paradigm for migration patterns and ultimately what their view of the future is with the distributed economy.

I’d love to hear any feedback you have for this episode. I certainly found it to be one of the most thought-provoking interviews done to date.

(hence why it goes on for a little longer)

More information

How countries and societies develop is a fascinating discussion, and one which acts as a bedrock for any understanding of how businesses operate.

This episode offers a new perspective on the paradigm which Africa can take, opening up the possibility to leap frog the development paths taken in other parts of the world.

Azuri Technologies are in the business of providing low-income households with their first reliable electricity source, through solar powered devices.

Whilst a light bulb (and satellite TV) could be viewed as just basic necessities, the fact that these have been powered through individual energy sources (as opposed to “grid” electricity) is, to Azuri, just the first step in a new trajectory of development.

Going forward, other basic needs can be provided to rural communities without the need of building expensive and difficult foundational infrastructure.

The interview is longer than normal as we delve into Africa’s current status quo and how it might differ from elsewhere in history.

We discuss how enabling basic infrastructure increases economic productivity in people which then catalyses economic growth. An example being that with light at night, children can study more and people can spend more time cultivating their land.

If listening at home and thinking how an idea you have might hit into the bigger picture of the continent’s development, this episode is a must.

Lessons and Insights

Next big thingsolar powered irrigation systems 

Biggest insight: “The distributed economy theory predicts that Africa’s development will leapfrog the West”

Find them Online


Facebook: AzuriTechnologies

Twitter: Azuri_Tech

YouTube: azuritechnologies

Kasha opens up access to sanitary pads in East Africa through last-mile distribution


There are certain products which, let’s face it, are more embarrassing to purchase than others.

You don’t think twice about buying a pint of milk, however things such as contraceptives, or sanitary items make you a bit more self-conscious, especially if you’re an awkward teenage girl.

Kasha an enterprise in Rwanda, started by solving the very discrete problem around girls accessing to affordable, quality sanitary items which can cause long-standing societal issues, such as school drop-out, if not solved.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



They are now running an ecommerce platform delivering female products throughout East Africa to women on all levels of the social spectrum.

Joanna, the CEO and I discuss the different customer segments they have on Kasha,the mechanisms by which they reach their users,and how their B2B offering of data-backed insights is funding those customers typically overlooked as unprofitable.

We conducted this interview in Joanna’s office, in Kigali and near the end, there was a huge downpour of rain which you can hear in the background.It doesn’t distort the interview, and if anything brings you closer to appreciating the changing microclimates of Rwanda, but just a heads up, in case you’re wondering.

For now though, let’s get started on this great episode with Joanna.

Kasha is a social enterprise based from Rwanda, but which is soon expanding to Kenya, and then beyond.

Joanna started her career at Microsoft, and then at Gates Foundation, the latter being an early sponsor of a pilot they were running.

The mission driving Kasha is that no girl should be prevented from access affordable, quality healthcare products.

This means having various channels for the different customer types, based on their income, but more importantly geography: we spend time discussing the various routes to market needed for both urban and rural delivery.

More recently Kasha has moved into other products that females wish to buy, namely in the beauty section.

The business makes money from various channels, one of which is the insights and feedback possible from their rural customer base. Companies such as Unilever have no way to get such feedback, and so the Kasha platform is able to provide.

Lessons and Insights

Biggest learning: even though we’re e-commerce, a call centre is incredibly important in building trust.

Biggest insight: “Bottom of the Pyramid” customers are even more aspirational than I imagined.

Social media etc.


Twitter: KashaRwanda

Instagram: kasharwanda

Facebook: kasharw

Revolutionising access to credit in Africa through Peer-to-Peer lending, with Hilda Moraa


Many international studies have pointed to the lack of SME financing as being a huge blocker to a country’s development.

In the context of Kenya, many small business owners are excluded from the formal financial sector due to the high operational costs involved with opening and running a bank account. As a result, they have no formal credit history and are not able to get a loan.

Pezesha are seeking to overcome this by giving the unbanked, their first step on the formal financial ladder.

Hilda, the founder and CEO, and I dig into the difficulties of getting a bank account (and by extension, a loan), how Kenya’s ubiquitous mobile money network facilitates their business, and how they are layering on their data analytics to the dynamics of the existing social investing culture in Kenya.

This is one of those episodes that can leave you scratching your head at times, but nevertheless shows the huge potential for technology and financing to transform a region.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



Pezesha means financial empowerment

We empower the unbanked population through affordable mobile credit. This brings hope and freedom to them.

We’re not a lender per se

We’re sitting in between and creating a platform that builds upon the sharing economy.

Our customers can’t go to a bank

To get a loan to grow their business. This is because they don’t have any financial history or any formal credit records to verify them.

The majority of Kenya lives on <$5/day

The banks see them as risky and, because it costs money to run a bank account in Kenya, simply having a bank account open costs operational fees which excludes them.

The unbanked have moved to mobile credit

Mobile money penetration is at 85%. Hilda’s grandmother has M-Pesa, living upcountry.

M-Pesa has become the bank of the unbanked

Allowing them to transact, and send and receive money. This gives them the services previously only possible with a (paid) bank.

We utilise chamas

A chama is a social network who come together to save and invest around a common goal. The money is typically rotated around the group. People meet in person, regardless of social background.

“Pezesha is automating Kenya’s social investing culture”

This comes from partnering with the chama network. This means bringing in technology to, say, credit score their members as well as increase the level of financing that they get.

Fund of funds

There’s then a dynamic of external investors funding the chama group and become part of the returns.

“We have Kenyans lending to Kenyans they’ve never met before”

On the back of Pezesha’s platform, it’s possible to build trust. The credit score combines a borrower’s willingness and ability to pay.

Alternative data

We use mobile money transactions, as well as different datasets to profile and understand the customer. This means we’re not reliant on just one form of information (i.e. M-Pesa transactions) but having things such as psychometric tests as well.

Agents on the ground

We have people who are our out doing a lot of the onboarding and collections out in the field.

We want people to walk up the financial ladder

The ideal is that they can walk in and get a bank account and a loan as a result of the credit history that they have got from Pezesha. We want to normalise the effect so others can trust the unbanked population.

We’re a data company

We sit in between existing financial players and utilise credit scoring.

You get a 7-12%/ year return at the bank

Despite this being high, investors won’t be proud with that type of return. With Pezesha, you get 13-36% annually.

Average loan size is $50

This is used to buy weekly stock and then 30 days later, they’ll pay $55.

People are paying back!

This was one of the (nice) surprises: that there are lots of the unbanked population who are still paying back on their loans. This is in part because by paying back they are helping to fund other fellow Kenyans.

Website links etc.


This gives details on how to be a borrower or a lender on Pezesha.


PartnersCGAPDFS Lab

Paying for textbooks by the page: how Kytabu is disrupting Kenyan education, with Tonee Ndungu


The main way that students learn how to pass an exam is by reading from a textbook.

Traditionally, this has been built on the premise of publishers printing physical copies,
distributing to schools and taking cash payments.

This all comes at a cost, which is prohibitively high for a lot of schoolchildren in East Africa.

Tonee and I spend this episode discussing Kytabu.

They’ve turned the model on its head by digitising the content of these publishers, and allowing students and teachers
to access what they want, when they want it,
renting chapters from a book at a few US cents per day, paid for with mobile money

We also discuss how a lot of Kytabu’s employees are still at university, other trends that Tonee sees in the East African EdTech space and how a different interpretation of doughnut can completely undermine attempts from abroad to distribute educational content

It’s a great example of using scalable technology to disrupt an industry, and so I hope you enjoy


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



Here are some of the key quotes:

“Kytabu is an EdTech application”

We’ve taken the entire curriculum that a student needs to pass Kenyan examinations, put it on a mobile application, and rent it out using mobile money.

“It’s being used everywhere”

We’ve never done a national launch, but it’s grown organically and is being used beyond just Nairobi

“15,000 users”

Is the current number on the app. Our potential comes in being able to get it into schools more. There are 8 million schoolkids in Kenya, so the potential is there.

“Supplementary education”

This is the main demand we find for Kytabu: students who are studying in school, and want additional resource when they’re revising.

“On the app, it’s the same content that’s in textbooks”

All of the content which is on Kytabu comes directly from Kenyan textbook publishers. This means that it fits directly with the curriculum.


It’s a smartphone application which somewhat reduces the app’s reach, but we’ve still found that enough people have mobile devices to use it.

“You now don’t need to buy a whole textbook”

Because the book is stored in the Kytabu app, it means that people can just rent it for a day/ week/ term rather than have to find the cash to buy a book which could get lost.

“Around a shilling (1 USD cent) per day”

It’s super affordable and can be lower. We’re seeing schoolkids spending around 7-10 shillings a week to access the content that they need.

“It doesn’t sound like a lot…”

But for the publishers, it makes sense. This is a scalable way in which to distribute their content, and incurs almost zero costs compared to the printing, distribution and piracy costs that come with physical textbooks.

“Schoolchildren use it for revision”

We use students using content for 85% of their curriculum. Our assumption is that they have the other 15% in hardcopy”

“Teachers use it in class”

They download everything for a whole term in the subject. We can see each week when they are using the content, and so can work out what they’re teaching and when. They’re spending $2-4/ month for all of their content needs.

“We need all subjects”

It only really makes sense for us to get everything at once, rather than focusing on just specific subjects (such as Science rather than Maths). Teachers are looking for very specific books, rather than just “a science textbook.

“Only 16% of Kenyans have access to a book”

Not all of the books, not some of the books, but just one book. And so by being able to rent them through a digital platform it hugely improves the accessibility.

“The publishers have been great”

They understand how digital is the future and how they need to embrace it. Kenya’s largest publisher lost millions on piracy last year, and so it’s compelling for them to work with Kytabu.

“Kytabu works for them”

It doesn’t really make sense for them to build their own platform. Students are interested in content from different publishers. Textbook publishers are in the content production industry, not really making a digital platform.


That’s the sell we have with publishers. Publishers come to us now – it’s a compelling sell now that we have the relationships with the publishers.

“A lot of interest in video”

This is one of the main trends that I’m seeing in Kenyan EdTech, along with an increase in teacher generated content. Another is parents buying tablets for their kids to use in school.

“Kytabu is completely Kenyan”

The whole team is Kenyan. Without myself and the CEO, the average age is 22. The majority are still at university, who manage their time between studies and working at Kytabu.

“Education is big, but slow”

The main surprise is the scepticism around new educational tools.

“Traditional donor money goes to non-thoughtful programmes”

Programmes that look to spend money to send stuff out to rural communities often miss the local context. The stories need to be local otherwise they won’t be adopted or understood.

“We want video to be more than entertainment”

We want Kytabu to start using video into the learning experience, such as taking museum experiences and bring it to the classroom. We also want to define what Kenyan content can be.

“Kytabu means book”

In 69 languages. Crazy, right.

Social Media Follows etc.

Website : Kytabu
Facebook : Kytabu
Twitter : Kytabu

Preventing food waste through solar powered fridges, with Luke Davey from Inspira Farms


One of the recurring themes throughout conversations with agriculture companies is the problems with post harvest loss

If produce can’t be kept cold then it will perish quicker and as a result farmers lose out on income

Cold storage (essentially a big fridge) offers the solution, but in an environment with inconsistent power supply, and poor access to capital, this has proved difficult.

In this episode Luke and I talk about how Inspira Farms are using technology to solve this problem.

We discuss how the technology they’ve developed is innovating the market, the compelling financial arrangement they are able to offer farmers and how selling in Kenya is different to doing so in Rwanda

I found this a really interesting conversation to cover the landscape of agriculture in East Africa, and so I hope you enjoy it too.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



Here are some of the key quotes:

“Inspira Farms is an off-grid agricultural technology company”

We focus on post-harvest solutions, primarily through delivering cold storage units for horticulture produce, along with financing and other options.

“We focus on Kenya and Rwanda”

In East Africa. We have a global presence but this is where we have consolidated for right now.

“30% of food to waste”

This is from the “farm gate” to the “processing plants”. Primarily this is due to a lack of post-harvest solutions.

“The whole world struggles with post-harvest solutions”

The existing technologies are very expensive and require things such as consistent energy supply. This is rare in developing countries.

“There are four key components of what we do”

  1. The modular stand alone structure which becomes an asset
  2. A software component allows a greater amount insights on the produce
  3. Cooling components which can run off solar
  4. An interest free loan to aid financing

“$5,000 – $20,000”

Is the cost of a unit being delivered to you. Based on the creditworthiness of the applicant the down payment will be 20-50%

“We need a single business entity”

Sometimes this is an individual farmers, sometimes a collective, sometimes an entrepreneur who rents it out.

“People want cold storage”

It’s in huge demand but people are often shocked at the cost of cold storage. Thankfully it’s an easy process by which we can quantify the farmer.

“It’s a big box”

That meets international food safety standards. We can provide shelving, but it depends on each.

“Building along the supply chain”

One customer has cold storage on the farm, others at the processing plant. The vision for these customers is to take it the whole way, with refrigerated trucks as well.

“It’s not a 2 day sales process”

Our recognition is increasing with more inbound than outbound enquiries. That said, it takes time to understand the customer, and make the sale.

“Our team is global”

Who we draw upon, bringing a range of skills at the right time. Technical expertise from Italy, account managers to do due diligence.

“Kenya is vastly more developed than Rwanda”

In terms of the agricultural development. Rwandans, however, are more matter-of-fact about the costs of what the technology cost.

“It was built to grow with the farmer”

The modularity aspect of cold storage units meant that farmers wouldn’t have an under-utilised asset for 5 years, but instead could grow with Inspira Farms.

“Patent pending”

We’re getting patents on our technology which means it will be harder for other companies to imitate us. Essentially get the insulation without having to build brick and mortar structures.

“100 units in 3 years would be really good”

There are lots of strategic projects that we have happening internationally, but for now, my focus on getting units on the ground.

Social Media Follows etc.


LinkedIn: Inspira Farms

Twitter: @InspiraFarms

Facebook: InspiraFarms

Start Up Energy Transition Awards

Inuka Pap uses mobile money to help low-income savings groups, with Waweru Kuria


Cash is risky business, and in Kenya, mobile money is big.

People living in rural areas are liable to have their life savings lost if it is kept under the mattress.

Many engage in lending co-operatives whereby a community organisation acts as a bank for people who need money in an emergency.

This is, however, pretty archaic and inefficient meaning people can’t get instant access to cash when they need it quick.

Using a digital platform that connects mobile money to these rural co-operatives, Inuka Pap is making it possible for people to get access to the funds in an instant.

Waweru and I discuss what the lending landscape looks like, their social mission of providing free insurance, and the blurred lines around whether they themselves are a bank or not.

As a side note, the day after I interviewed Waweru he pitched Inuka Pap at Seedstars, a global start up competition, and won the title for Kenya! You’ll see that he has knack for storytelling.

Also, a car alarm goes off in the background right at the end, so apologies for that…

In any case, I hope you enjoy!


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



Here are some of the key quotes:

“The dream started many years ago”

I have always worked with ways of improving people’s lives, through churches and other organisations. Inuka Pap started properly in January 2016.

“We don’t save money in banks”

In rural Kenya, where I grew up, people do not put their money into an actual bank account. Instead there are savings co-operatives (SACCOs) which communities are a part of.

“Getting a loan took 2 days – 2 weeks”

In a moment of needing a loan, it would take time to actually get the cash you need. This is due to the logistics of issuing cash and travelling to the SACCO head office.

“Inuka Pap means…”

Rise up, instantly.

“Our platform does mobile money for lending co-operatives”

Mobile money penetration is >90%. The infrastructure works whereby even in deep rural areas, someone who is sent money can withdraw cash from a kiosk and pay for services immediately.

“We don’t deal with who gets what”

Co-operatives are in the business of knowing how much each farmer can and should receive. Inuka Pap isn’t directly involved with who gets what, it simply makes the payment of these transactions much more efficient.

“A cash environment is risky”

When people keep physical notes stored in their house for emergencies notes are liable to go missing to drunken husbands or hungry rats. It also makes it harder to get a credit history with the co-operative because all of these savings are kept centrally.

“People don’t care about Inuka Pap…”

They care about their co-operative. Once the co-operative uses Inuka Pap individuals feel comfortable accessing their money much quicker.

“Our user base is now 12,000”

In less than eight months. Many individuals are using the service through their co-operatives across the country.

“Some co-operatives have been around for hundreds of years”

For example one that is based around a coffee planting community. The running of these co-operatives has been in the family and so they are deeply set on how to run them and are very comfortable with how they live. This means they are less open to Inuka Pap, at first.

“Small co-operatives take it up quickly”

They are less set in their ways and are generally forward looking when it comes to running their co-operatives.

“We are paid 15% of what co-operatives make”

Co-operatives make money on the interest that they charge to individuals. Inuka Pap earns 15% of this amount.

“The loans are high interest”

They’re not for 12 months but instead are more like a 30 day emergency loan. Being through a co-operative, all of the money goes back to the group which has benefits.

“There are 16,000 co-operatives”

Serving 13 million people. And so we are confident that the market size is massive.

“After 5 million people we’ll move out of Kenya”

There is pent up demand not just in Kenya but also around the rest of sub-Saharan Africa. We’ll move on there afterwards.

“Talent is tough”

Attracting the right people to work at the company is difficult. Our CTO works remotely from South Africa.

“We’ve kind of made our own co-operative”

Individuals can access loans directly through our app which, because we own the money being paid back, is pretty profitable.

“Direct savers can get free medical insurance”

Using the retained revenue we are paying for users of the platform to have free medical insurance. We’re the first in Africa to do this.

“A lot of businesses fail because someone got sick”

In an emergency when a family member has to go to hospital the only way to access funds is to take capital out of the small business that someone runs.

“Are we a bank? No idea!”

We think of ourselves as a platform that helps people save and access money. The government are on our side, but we’re not sure whether to consider ourselves a bank or not.

“There’s a big opportunity to partner with telcos”

In every country the mobile providers are looking to push their mobile money platforms. If we can have close ties with these services then it can get Inuka Pap to a wide ranging audience very quickly.

“We are good to learn from others”

At Inuka Pap we are very open to feedback and are wanting to learn from others. If there are individuals or organisations who want to come to the office and show us what we can do better, we’d love to hear from you!

Social Media Links etc.


Twitter: @inukapap

Email: [email protected]

Inuka Pap wins Seedstars Nairobi

Treasure from trash: how The Recycler creates value/ maggots from waste in the booming Dar es Salaam


One of the by products of a country’s development is the amount of waste that is produced.

As populations grow the number of, say, plastic bottles that are consumed increases.

It’s costly both financially and environmentally to transfer these materials to dumpsite and Matthew from The Recycler wants to change this.

His business is all about creating value out of products that would otherwise be thrown away to increase the amount of recycling that occurs.

We discuss why Tanzania is the prime location for this type of business, the applications of waste, and how he is growing maggots as a much more sustainable form of chicken feed.


Sign up below to hear whenever there are new stories and episodes released on the podcast

Please wait...

Thank you for signing up!



Here are some of the key quotes:

“We’re a waste management and recycling company”

We collect a wide range of items for big organisations, and then sort it out into recyclables.

“We also grow maggots”

This is about adding value to organic waste.

“Most people took waste to the dump”

At such volumes that they were going twice a day. We now save them money by sorting it and reducing the number of trips they need to make.

“Our waste goes to local companies”

The whole philosophy is about giving value to materials that would otherwise go into a landfill. This means selling white paper to an envelope factory etc.

“It’s a great way to create jobs”

You’re literally making jobs out of things that people were throwing away.

“So… maggots”

60% of waste in Tanzania is organic. The conditions in Tanzania are perfect for these types of maggots to grow.

“Chicken feed”

The maggots are used to feed chicken. It’s much more sustainable than soy or fishmeal. And it’s also what chickens have been eating forever.

“We have commercial and individual products”

As well as a large scale process for these maggots, we have also developed a bin that can be used by families. They keep their organic waste separate and soon maggots start appearing.

“Make bins accessible as possible”

We want to make it as affordable as possible. People might then be able to sell the excess maggots for chicken feed. Rough sums are a two month payback.

“Dar es Salaam is the third fastest growing city in Africa”

The place is projected to grow rapidly in the next twenty years and so with that waste is going to be increasing.

“The Tanzanian recycling market is undeveloped”

In Nairobi, the price for recycled materials is up to 5 times as high. The industries are much more used to tapping into a recycling infrastructure.

“Next, we’re looking to informal collectors”

The citizens earning the least in society are typically those collecting up plastic bottles for resale. If we can create value from other products, we can pay people more.

“Shredded plastic bottles are turned into T-Shirts”

Informal collectors pick up recycled products, sell to middlemen who then ship it to China so that it can then be turned into (polyester) T-Shirts.

“My experience of business in Tanzania has been very positive”

It might not be the case for everyone. A lot of people cite that Tanzania is one of the worst places to do business, however I haven’t felt that.

“Our prices differ”

In some instances we have a weekly pick up service, in others we give rebates to companies where we can sell on the waste.

“Glass is incredibly sustainable”

The bottle deposit system of returning a glass bottle once you’ve finished your Coke is one of the most environmentally friendly methods. There’s much more resource involved in recycling plastic bottles.

“Zero waste”

It’s a new movement which is anti-recycling. It’s about designing products in such a way that we don’t throw things away.

“How can separation occur naturally”

If people have an incentive to separate their organic and other waste because there is value in it, then that saves a lot of effort.

Social Media Follows etc.

WWF article: soy bad for the planet

Zero waste movement


Facebook: Recycler Tanzania