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Creating markets for the base of the pyramid

Creating markets for soy protein in Andhra Pradesh, India

Where was the market for Solae's protein in rural India? It needed to be created.

On Monday, the Wall Street Journal published an article by my colleague Erik Simanis about our work developing new markets in the base of the world's income pyramid. Erik is a pioneer in business development methodologies for the BoP.

The Base of the Pyramid is not actually a market. True, those billions of low-income people have a lot in common. But they don't have two of the vital characteristics you need to have a consumer market. They haven't been conditioned to think that the products being offered are something one would even buy. And they haven't adapted their behaviors and budgets to fit the products into their lives. A consumer market is nothing less than a lifestyle built around a product.

Erik uses a range of examples including bottled water in the U.S., P&G's PUR water cleaning powder, KickStart's MoneyMaker pump, and our own work with Solae in India to demonstrate that companies should think twice before assuming a market for their products exists, even if those products are well designed. And if a market doesn't exist then traditional market entry approaches - the kind that most companies use and most managers are taught - are largely ineffective. Instead, companies need to learn to create markets.

Since the first BoP Protocol pilot in 2005, our work has focused more and more on the challenges of creating new markets and building the enterprises that enable them. Over the years, we have learned a number of hard, but handy, lessons. Three of those lessons are described below.

The play goes on - Projeto BIRA (Brazil)

"Ever since I was a kid, I've had a strong desire to travel all over Brazil, to get to know its diverse realities firsthand. When I'd travel with my parents, my eyes fixated on the landscape passing by, and I'd imagine myself visiting each little house on the side of the highway. I'd invent names and destinies for those kids with barefoot bodies whose eyes gazed into the wind, and for those old folks with crooked canes who spent hours on crooked benches in the shade of jacaranda trees . . . The childhoods and games in each place I passed were what always attracted me the most." - Renata Meirelles, How it all Began, Projeto BIRA

A few years ago - when I was getting started with BRINQ - I was thrilled to come across the work of Renata Meirelles and David Reeks, a Brazilian American couple that was working hard to document and share the toys and games of the Brazilian Amazon. Their stories of what they discovered and shared were truly inspirational and I had hoped to meet up with them on one of their trips back to the U.S. Unfortunately the timing didn't work out and I have since moved on to other projects, leaving my task of building a global toy chest sadly neglected. However a recent discussion on the Omidyar Network about recycled crafts and toys sent me looking for David and Renata's work once again and I was delighted to see what they've been doing in all this time.

Linking Into the BoP

Image rendered from logos of Linked In and the BoP Learning Lab

A few years ago I was swept up in a wave six-degrees-of-separation invitations from the professional networking site Linked In, most of the invitations coming from old b-school classmates at UNC.  As a good little networking MBA, I sent out as many invitations as I could too, feeling a certain thrill in seeing the breadth of my professional and social network. However after that initial rush I pretty much forgot all about it.  “Who actually uses this thing?” I remember thinking.

Then a week ago I got another invitation from an old colleague of mine at Rockwell International who wanted to reconnect and to share the news that a patent application of ours had finally been accepted (I have two patents in my name, officially making me an “inventor”, albeit the kind that doesn’t make any money for his inventions).  This old colleague wrote, “I always wondered what happened to you after you went back to school, sounds like you’re doing some interesting things!”

Those words sent me back into the Linked In universe, searching for other old colleagues that I had missed.  And after the excitement of reaching out to old acquaintances had passed, I decided to go poking around my Linked In network. It didn’t take long before I started looking for other people who also worked in the Base of the Pyramid. About 65 connections came up, interestingly enough most of them at 2 least degrees away or more: meaning I have few direct connections working in my own field.  

Exceptional Lives - Pilgrimages about People

I've often said that one of the greatest joys of my work is the exceptional people that I get to meet and to develop friendships with. Whether or not it's Salim Mohamed and Sammy Gitau in Kenya, Murali Ramisetti in India, or Theresa Williamson in Brazil, I have been blessed to know so many people who are busy painting their visions of a better world into reality. So I've often wondered, "What it would be like to just go on a pilgrimage to find and learn from such people?"

Inspirations: BoP-Protocol.org and e4sw.org

Things have been pretty quiet around the BRINQ Workshop, only a few posts in the last six months, so what have we been up to?

Well, besides trying to get things started in Brazil again, I've been doing a lot of work for other folks, most particularly Enterprise for a Sustainable World (ESW), a new organization started up by Cornell University professor and Sustainability guru Stuart Hart, whose book "Capitalism at the Crossroads" we covered here before.

Global Heroes - Carolina for Kibera

Another story about one of the BoP Protocol Pilot's most important partners: Carolina for Kibera (CFK) last week was honored as one of Time Magazine's "Heroes of Global Health" and Acting President Kim Chapman was featured at the Global Health Conference in New York.

CFK is an incredible community-based organization in Kibera: one of the world's largest slums on the outskirts of Nairobi Kenya. The organization's programs target issues of ethnic violence, health care, safe spaces for girls, and environmental sanitation and income generation. All their work follows a common theme of participatory development and the organization's operations in Kenya are run by Kiberans.

Finding the Hard Answers - Catalytic Communities Launches Upgraded Site

Catalytic Communities (CatComm), our community partner in Rio de Janeiro, Brazil, announced the launch of its new community empowering site www.CatComm.org. CatComm is a huge inspiration for us here at BRINQ, their insights in cultivating and capturing local innovations have been critical to us in our early years and their active work with communities generating solutions has taught us that stronger relationships lead to more viable innovations. In a world of people content with "asking the hard questions", Catalytic Communities is a refreshing example of an organization actually looking for the hard answers.

More from Kenya - Justin's Stories

For those of you looking for more tales from Patrick's time working on the Base of the Pyramid Protocol Pilot in Kenya, we'd be remiss in not pointing you to the writings of our colleague Justin De Koszmovszky. Justin is a 2nd Year MBA student at Cornell's Johnson School of Management, President of the Cornell's Net Impact chapter, a Park Leadership Fellow, and an all around brilliant & great guy. Justin is part of the BoP Protocol Pilot team in Kenya and spent most of his time in country actually in the country, out on the fields and farms of Nyota and Molo. As you can see from the sample below, Justin's writings and insights are beautiful, touching, and really make his experience in Kenya come alive. Highly recommended.

WRI Officially launches NextBillion.net

The World Resources Institute has officially launched NextBillion.net, an online community focused on the intersection of business, innovation and poverty. We were lucky enough to get an early look at NextBillion, and WRI was kind enough to quote our impressions in their press release. See for yourself!

New WRI Blog Targets 'Next Billion' Consumers Dollars

WASHINGTON, May 27, 2006 - The World Resources Institute has launched an interactive blog focusing on business's role in eradicating world poverty. The organization hopes to position its new "NextBillion.net -- Development through Enterprise" blog as "the world's premiere online water cooler and conference room" for socially responsible business development.

Previously, there have been e-mail lists for such business developers, but NextBillion.net allows development and poverty reduction to reach a new level by offering a bottom-up educational resource and threaded-discussion tool for everyone from multinational executives to small-business entrepreneurs.

Representatives of companies such as Microsoft, Hewlett-Packard, Pitney Bowes, DuPont and SC Johnson (as well as many innovative individuals) have already begun posting comments and discussions on the blog. For instance, noted author Stuart Hart posted exclusive content this week detailing issues highlighted in his new book, Capitalism at the Crossroads: The Unlimited Business Opportunities in Solving the World's Most Difficult Problems. Additionally, with today's official launch, NextBillion.net's creators expect to quickly establish the site as the top news feed and content resource for corporations, foundations, the business-school community, poverty NGOs, development organizations, and many others.

Lighting Up the Crossroads - Stuart L. Hart

"Stuart Hart was there at the beginning. Years ago when the term 'sustainability' had not yet reached business schools, Stuart Hart stood as a beacon in the umbrage. It is clear commerce is the engine of change, design the first signal of intention, and global capitalism is at the crossroads. Stuart Hart is there again; this time lighting up the intersection."

- William McDonough, Co-author of Cradle to Cradle

Three years ago, a group of MBA prospects visited the University of North Carolina's Kenan-Flagler Business School. We were wined & dined and offered full rides and stipends, incentives to reject offers at higher ranked business schools and earn our MBAs at Kenan-Flagler instead. The admission staff knew they had to be convincing, so they brought out the big guns. We were introduced to Stu Hart.

Naturally, we decided Carolina was a fine place to be.

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