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.


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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.


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.


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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.

Entrepreneur and author Sean Keough explains the need for a different financial model in developing markets


This is an episode which I really hope you stick with.

As you’ll have seen from some of the other episodes, I find that often the “unsexy” aspects of doing business in East Africa are the most interesting and important.

Financial modelling is not necessarily top of most people’s lists to think about, however, in this episode, Sean Keough puts forward a pretty compelling argument why you should.

Sean has worked in Ethiopia for many years and has been building up businesses in the country which haven’t previously existed.

He began with advising other companies on their growth and found that it was difficult to forecast what the impact would be of different business decisions.

Entrepreneurs knew the ins and outs of their business, but couldn’t run through scenarios of how external factors affect their business, and as such were running blind, and also not having the rigour to attract foreign investment.

Long story short, Sean has now written a book which takes entrepreneurs through how to model their business.

It’s available on Amazon by searching for the somewhat cryptic title of “Financial Modelling in Developing Countries”. You’ll also find a link in the podcast description: Financial Modelling for Developing Countries

The interview also allows us to speak more about the nuance of doing business in Ethiopia, one which is fundamentally different to others in East Africa owing to its closed economy legacy.

There are tons of insights here around the different dimensions of working in Ethiopia, as well as the life aspect of running a business in the region.

For more episodes from Ethiopia search for Ride Hailing and Takeaways in the archives, but now, it’s my great pleasure to introduce Sean Keough.


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It all started trying to attract capital

Helping foreign investors to invest in Ethiopia. Not possible to answer questions on the business in a way to satisfy investors.

Sean works on different

90% with EQOS (Ethiopia’s first business outsourcing business)
10% with EIL (Ethiopia Investment Limited)

Entrepreneurs know the ins and outs of their business.

However, they had difficulty in giving answers to why certain decisions were being made.

Example of wheat processing.

The root of the issue comes from foreign reserve currencies.

Ethiopia is different

Because it’s been a closed economy since the early 2000s there are certain business practices that are unique to the country.

The foreign currency reserves are key

There were lots of infrastructure projects (dams, railroads etc.) which require the use of foreign currency because there isn’t enough local currency to fund the projects. As a result, the rate at which Ethiopian burr is traded with, say, USD is much higher.

12 step financial model

The book helps you build and maintain your financial model.

Sensitivity analysis is the most interesting

Starting there helps Sean explain to the entrepreneurs how something like switching from a local to international distribution will affect their margins. Power of your decisions that you didn’t have before.

Net working capital is key

Is much more expensive than elsewhere. These are big hits on the cash.

1. More inventory needed
2. International payment terms take longer

Scale my own business slower

We didn’t have the processes in place to build up that quickly. More patience is required.

Message to investors on delays

We thought it would take X, in fact, it took Y, here’s what we’re doing to rectify. We generally half the project profit and expand the timelines by 3-5 times.

Our investment philosophy

Build businesses that will generate cash flow rather than to exit.

What’s changed the life perspective?

Harder, you work, the harder you need to rest. Getting quiet, getting solitude is really important to avoid burnout. The most stressful aspect has been managing the people. They’re counting on you to make the right decision. This comes from having enough.

One for One on the book

For every copy sold on Amazon Sean will give it to an entrepreneur in East Africa.

Lessons & Insights

Biggest lesson: should have scaled outsourcing business more slowly

Biggest insight: Ethiopian currency dictates how businesses should be modelled

Memorable quotes: Insights from a financial model will help you dominate your market

Links etc

BookFinancial Modelling for Developing Countries

LinkedInSean Keough

Other podcasts on Ethiopia: Ride Hailing ( Localised Uber version – Ethiopia ) Takeaways – Food E-commerce Platform ( Ethiopia )

The Economist’s Africa editor compares East Africa’s development with the rest of the continent


In this episode I speak with Jonathan Rosenthal, the Africa Editor of The Economist.

Our paths crossed when I was back in London for a few weeks, and so we took the opportunity to meet, and speak about some of the continent wide trends which he’s seeing, from the vantage point of running the Africa desk for the magazine.

Most episodes you’ll have listened to on the show will delve into a particular aspect of running a company in East Africa. Teasing out the specifics of why a certain business decision has been made or not, or trends that are present within a particular industry niche.

This episode is slightly different.

Jonathan and I take a much broader look at Africa’s development through the lens of, say, government debt ratios and currency reserves.

Whilst this might seem a bit lofty, I’d encourage you to stick with it.

In listening to the other episodes you will (I hope) get an understanding of the micro level of business in the region.

To get a fuller picture requires, I believe, to understand the larger macro factors at play in the story of development.

One such example of this is the government policy of raising debt from local banks.  Because the interest rates they offer are so high, it distorts the incentives for banks to lend to local businesses. As such, this macro level effect of “crowding out” the private sector trickles down to the suppression
of local businesses looking for capital to grow.

There are also references to the macro trends that can come from the innovation of rooftop solar systems. If you’d like to learn more on this, be sure to check out the Distributed Economy episode with Conrad Whitaker from Azuri Technologies.

The interview took place at The Economist HQ in London which, helpfully, has a recording studio of its own. If you’re interested in hearing more from The Economist, be sure to check out their regular podcasts which feature updates, insights and in-depth interviews that expand on their stories.


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Former banking editor of The Economist

The editor was looking at more of a business/ finance angle rather than just people looking at dangerous war zones.

Africa is skewed by South Africa and Nigeria

The simple dissection of those two main economies with the rest of the continent is a way to identify growth patterns.  The price of oil is a big determinant of the West African economy.

Debt in East Africa

There is an interesting relationship between investment and taking on debt. If it goes towards productive use: great,  though some of the growth seems to be from unsustainable government spending.

Distressful levels of debt?

Public Debt: GDP. How much have government entities borrowed as a percentage of what you earn. Africa has what seem to be relatively modest levels (50%) compared to an international level (80-100%).

Interest rates are higher locally

This often means that the government is paying back a higher percentage of the (low) tax revenues that they generate which becomes a significant burden.

Problem: governments raise local currency

This comes from local banks. The T-Bill rate that I can get from the government is really good, and so why should I take on the risk of lending to local governments?

Result: local banks channels savings to the government which means that local businesses aren’t able to get

Suppression of domestic business growth

This is the result of incentives at play, and relatively shallow capital markets, which means that new companies have difficulty to grow.

Financial repression

This is a way out of the cycle: capping the amount of government debt local institutions can hold to force them to get their money out into the economy.

Intra-Africa trade is low

Difficult to measure, but the value of trade between nations is internationally very low. There are still non-tariff barriers.

Slow ports drives up costs

The inefficiency of containers sitting idle, the higher the cost, the less internationally competitive it becomes.

Africa missed out on textiles labour

There’s a path dependency in that a number of, say, textiles factories have set up in China, and so it’s less likely to move elsewhere. This is now moving.

The race against the machine

Can Africa industrialise before robots outstrip unskilled labour?  Some tasks are complex for machines to do still, and still expensive, and so the economics are still compelling to hire local labour.

African Central Banks have done very well

By and large there has been a professionalisation of financial discipline which has translated through to low and stable inflation.

Ideological opposition

To privatising aspects of institutions. Some believe in the China model of it being state led rather than profiteering private companies. The Economist is, as a general stance, in favour of the capitalist approach.

Lessons & Insights

Best bang for buck? Reduce the influence of a predatory state. i.e. instigate competitive, privately-owned port operators

Insight: “Africa missed the escalator of the original boom in textiles”

Opportunity: “Countries need to build stuff to grow (rather than relying on a service economy)”

Links etc.

Jonathan on Twitter:

The Economist Radio:

Big Data Lending: unlocking commercial capital for Africa with Daniel Goldfarb from Lendable


It’s widely acknowledged that one of the biggest prohibitions to the development of East Africa is lack of capital.

The global economy is premised on aggregating savings in, say, pension funds and then deploying it to areas where it will earn a return.

This investment is what generates economic activity – stimulating business growth and creating jobs.

It also generates a return for those running, say, the pension fund to disperse to their members.

Traditionally this large scale movement of money has happened only in developed markets.

Developed markets are structured in a way that allows finance professionals to calculate the riskiness of an investment, and therefore feel comfortable parting with their capital with an expectation it will be paid back.

Traditionally, the methodology for deciding whether to invest big pools of money in Africa has been done using the same framework as for developed markets.

This hasn’t bode well.

In short the techniques for deciding how much money to invest have meant that only small amounts could be safely deployed.

Lendable have taken a different approach.

They are a technology enabled debt platform created to help non banking lenders scale.

They use in-house software tools and algorithms to analyze loans and offer facilities that make sense for lenders based on their loan books.

It might sound simple, but this approach of a buying a loan book, rather than looking at the assets that a company has, is a paradigm shift towards creditworthiness and has meant the company has been
able to unlock millions of dollars of capital that, using the old frameworks, wouldn’t have been deployed.

Now, I appreciate that might all sound a bit technical and advanced but Daniel, Lendable’s CEO and I go into the details of how this works – as well as tales along the way of running their business through two Kenyan elections, and what it takes to attract US Hedge Funds to invest in Africa.

This is, for me at least, a great episode around how large scale impact can be achieved through facilitating the transfer of wealth from the developed to developing world.


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Lessons & Insights

Biggest insight: when times are tough people spend more on electricity

Biggest lesson: by rethinking risk we can unlock millions of dollars for Africa

Website etc.

WebsiteLendable Marketplace


The social (and commercial) upsides of building an online parenting platform, with MumsVillage


One of the upsides of the internet is the ability to collect and store information that was previously only passed down between generations, or spread by word of mouth.

One of its downside though, is that it’s a very big place, and trying to find relevant information can be a thankless task in a world where we’re all short on time.

Of all the information that’s out there, Mums Village is looking to organise it for a discrete set of people

Mums in Kenya.

Isis, the founder of Mums Village, and I discuss the platform she has built.


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We go into what Kenyan Mums are wanting to know about, the partnerships they’ve built with local and international business and how she’s seeing the next wave of internet users engaging with content in a different way

What I like about this is how Mums Village sits in the middle of two sets of people who each have a need.

Namely, that they are providing value to Mums (whom they don’t charge) and that this aggregation into one place is valuable for brands looking to connect with them (where they do charge).

This is a good lesson for any entrepreneur looking at creative ways in which they can build a business.

Also, we make reference to a podcast interview with a company called Lynk.

You can listen to that episode by searching for the Services Marketplace episode when scrolling through the archive

In industry circles, it’s known that new Mums are a valuable market segment to own.

As a consumer juggling many responsibilities, they are typically willing to trade time for money, however this comes with an expectation of a higher level of trust.

When it comes to building trust, people generally favour getting advice from those they know already, and with the advent of the internet, it’s possible for these discussions to be happening online.

Mums Village is taking the conversations at the school gate and aggregating them into an online platform.

This includes all types of media, whether it be articles, forums or even a TV show, all with the central message of making the lives of Mums easier.

In order to bring greater value to their users, the platform partners with organisations looking to connect with Mums, offering products and services that will be of benefit to them.

The platform has been going for a couple of years already, and with Isis’ experience scaling Google and MTV across Africa, they are setting their sights beyond just Kenya.

This is a great episode both for learning how to build a two-sided business, being at the frontier of converting offline conversations online, and also to hear about insights on the East African parent.

Lessons and Insights

Biggest insight: I’ve had to unlearn my approach to how users will find us online

Our content: We’ve given brands a new way to engage via The Mums Village Show

Find them Online/Other Helpful Links


Facebook: MumsVillage

Twitter: MumsVillage

Instagram: mumsvillage

Mums Village show:

Lynk podcast episode: Service Marketplaces

African rocketship BitPesa use blockchain to enable international payments, with Elizabeth Rossiello


This week we’ve got an excellent episode which looks at applying breakthrough technology, to frontier markets.

You’ve probably heard of Bitcoin and blockchain, and here Elizabeth Rossiello CEO and founder of Bitpesa and I discuss how this technology can help African businesses grow through improving how they make international payments.

Why? Well in mature markets there’s a lot of liquidity between different currencies, meaning if you wanted to trade between Euros to Dollars to Pounds, the fact there’s lots of people trading it means you can get a good price.

However, when you are looking to trade African currencies, there’s not so much activity meaning companies are getting caught with high high prices to move money around the world, such as paying suppliers.

Bitpesa has stepped in to provide financial remittance services for anyone wanting to buy or sell African currencies, with Bitcoin and digital currencies acting behind the scenes to smoothen the process.

Just a heads up that this interview took place over an internet call which is different to the in person episodes done to date, and also that Elizabeth will be speaking at The Economist’s Innovation Summit in Nairobi, and so be sure to check that out if you’re interested in learning more.


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The business began 2013

I’d been working with MFIs across Africa. The issue I saw was businesses needing to get financing in local currency.

A way to buy African currency abroad

Is the problem Bitpesa solves. We’ve looked at how technology can solve this problem. B2B quickly became the best use case.

Bitcoin is part of our technology suite

We use Bitcoin as one our digital currencies. 70% of the business touches Bitcoin at some point. “We love using Bitcoin, but we’re not obsessed with it”.

Transferwise is a potential customer

Bitpesa is a market maker in African currencies. It’s brought about from having on the ground operations in all African countries.

Raised $10m

This has spent on physical operations, licences and IP. We use debt financing for inventory float.

Joint ventures weren’t for us

When it comes to growth, whilst it might be quicker to partner with a local company, going forward this isn’t the best way to generate value.

Typical use case

Nigerian pharmacy needing to pay suppliers in Hong Kong. They deposit Nigerian currency and Bitpesa pays out in Hong Kong Dollars.

Digital currencies allow us to extend beyond our reach

When we don’t have a physical bank account, we’ll send money to a broker who will accept, say, Bitcoin.

We’re not caught up in Bitcoin fluctuations

The transaction is executed almost instantaneously, and the risk is also mitigated just like any other broker that’s operates around the world. It’s just a different technology.

There haven’t been many African exits

Which means investors can be unsure about investing in the region. There was also a fizzle of the mobile money innovation in Kenya where regulators got in the way of innovation.

“Advice to regulators: don’t close your eyes to innovation”

You can’t stand in the way of an ocean of innovation. Regulators seem to be receptive to the idea of using Bitcoin and blockchain technology and so I’m excited for this.

I don’t believe there’ll be one mono-currency

And so I’m a firm believer that fiat currencies will remain in 50 different countries – we’ll be there for companies to exchange money in those regions.

Social Media Follows etc.





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.


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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

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.


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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!


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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