Tell us about the social impact of your innovation. Please include both numbers and stories as evidence of this impact
Effect on entrepreneurs
The project empowers local people, mostly women, by using a microfranchise model, in which community members will sell and recharge the lights. Each entrepreneur will be provided with their own POWERCycle generator and an initial set of 100-250 lights to sell to local families. The entrepreneurs will draw an income by charging light owners $0.35 per charge. The result is a profit of over $5 per day. Such an income would launch an entrepreneur out of extreme poverty, giving them four to five times the national average income and allowing them to pay for, among other things, education, health services, and the nutrition of their families.
Effect on customers
•Poverty Alleviation: With Nuru families save 90% over kerosene. For families that earn less than $1 per day, these savings are life-changing, allowing them to spend more on the health, education, and nutrition of their children.
•Health: Nuru will prevent households from breathing in noxious kerosene fumes, dramatically improving their pulmonary health.
•Education: With Nuru, children will no longer be restrained by daylight and can study and do schoolwork at their leisure. The improvement will be most pronounced with female students, who are burdened with a greater number of household responsibilities, such as cooking and collecting firewood, leaving little time to study before dark.
•Income Generation: By employing local people, to sell and recharge the lights, Nuru provides employment to thousands living in poverty.
•Accident Prevention: 25% of Rwandan households reported kerosene related fires in the last year. Nuru will eliminate any risk of fire.
•Improved Lighting: With Nuru, Africans gain access to a light that is bright, multi-functional, and completely mobile.
Effect on the Environment
In East Africa, kerosene remains the only source of light for almost 90% of the population. Each kerosene lamp emits, on average, 0.15 tons of CO2 per year. Nuru has an aggressive expansion strategy, which will include sales of 1.7M lights within 5 years. As our 10-month baselines survey proved, each Nuru Light replaces one kerosene lamp. The result is over 350,000 tons abated within 5 years.
Problem: Describe the primary problem(s) that your innovation is addressing
There is a tremendous need for our light due to the absence of an affordable, safe, and clean lighting for the rural poor without electricity. Most of the rural poor in the developing world use kerosene, including almost 90% of East Africans. Kerosene is:
•Polluting: Worldwide, kerosene is responsible for over 250M tons of CO2 emissions annually.
•Expensive: 1.8B people lack access to electricity entirely, spending 10-40% of income on replacement lighting services. These sources of energy are dirty and inefficient, and on a per-kilowatt basis they cost anywhere from 5-100X more than modern technologies.
•Unhealthy: Kerosene and other fossil fuels produce noxious fumes that can lead to a variety of ailments. 780 million women and children breathing particulate laden kerosene fumes inhale the equivalent smoke from two packs of cigarettes per day (World Bank).
•Dangerous: Kerosene lamps cause countless deaths by burns, fires, and suffocation. In Rwanda, 25% of households reported a fire in the last 12 months.
•Inadequate: The light provided by a kerosene lamp is dim and inefficient. The amount of light from the lamp is only about 1% of what the people in industrialized countries have for the same price and is only 0.2% as strong as a 60W bulb.
Actions: Describe the steps that you are taking to make your innovation a success. Include a description of the business model. What might prevent that success?
Nuru has an innovative distribution/sales strategy that will allow us to scale at an unprecedented rate. Instead of selling lights directly to the end consumer, which requires large inventories, slow turnover, many sales representatives and high working capital requirements, we sell directly to microfinance institutions (MFIs). The MFI then loans 100-250 lights to each “entrepreneur”. The entrepreneur then sells to the end customers; with the revenue from selling the lights at a roughly $0.44 per light markup, the entrepreneur pays back the loan over 6-8 months.
Light Distribution: NURUMFIENTREPRENEURCUSTOMERS
Nuru will rapidly establish recharging stations throughout the countryside by distributing pedal generators to entrepreneurs at no (or minimal) upfront cost. Each POWERCycle will have its own keypad and in order to operate the POWERCycle, the entrepreneur must buy activation codes, which, depending upon the amount purchased, will allow the entrepreneur to recharge a certain number of lights before having to purchase another activation code. The entrepreneur will be able to use mobile-money text messaging to buy credit through his/her phone.
The entrepreneur will pay back Nuru $220 for the POWERCycle, in addition to free marketing materials, through the purchase of activation codes. Entrepreneurs will be charged a higher rate on each activation code purchase and the difference in price will go towards the purchase of the POWERCycle; once Nuru has collected the additional $220 from the entrepreneur, the entrepreneur will then be charged the normal rate for activation codes, which is equal to ~15% of his/her revenue. This distribution strategy allows anybody to become an entrepreneur and minimizes the risk taken by the MFIs, as they only have to loan the lights and not the pedal generator.
POWERCycle Distribution: NURUENTREPRENEURS
The major factor that could prevent the success of the project is (1) inability to distribute through MFIs and (2) underperforming entrepreneurs. We mitigate these factors by working with a number of MFI partners, giving us maximum reach and minimal dependence on any individual MFI. We also have a thorough selection, training, and monitoring process to ensure that our entrepreneurs repay their loans and are productive/motivated.
Results: Describe the expected results of these actions over the next three years. Please address each year separately, if possible
• Establish 265 new recharging stations
• Provide an income of over $3 per day to 265 entrepreneurs
• Sell 25,000 lights
• Save 25,000 customers 95% on their lighting costs
• Allow 75,000 children to study at night
• Boost productivity by up to 30% for 25,000 households
• Prevent the emission of 1,000 tons of CO2
• Earn $215,000 in revenue
• Expand operations in Rwanda & Kenya
• Introduce the Nuru Cell Phone Charger
• Establish 1,250 new recharging stations
• Provide an income of over $3 per day to 1,500 entrepreneurs
• Sell 145,000 lights
• Save 170,000 customers 95% on their lighting costs
• Allow 500,000 children to study at night
• Boost productivity by up to 30% for 170,000 households
• Prevent the emission of 12,000 tons of CO2
• Earn $1.7M in revenue
• Expand to Tanzania & Uganda
• Introduce the Nuru Radio and the Nuru POWERPack
• Establish 2,200 new recharging stations
• Provide an income of over $3 per day to 3,700 entrepreneurs
• Sell 335,000 lights
• Save 500,000 customers 95% on their lighting costs
• Allow 1.5M children to study at night
• Boost productivity by up to 30% for 1.5M households
• Prevent the emission of 45,000 tons of CO2
• Earn $4.4M in revenue
• Expand to Burundi
If your innovation seeks to impact public policy, how?
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