Archive for Uncategorized
>The Android team at Google has just produced a video that shows the growth of new activations of Android phones throughout the world. It’s very impressive to see how from a trickle in late 2008, users are now coming to the platform in floods, in particular after the Motorola Droid came out. You can even see how the major urban centers like New York or Paris are the first ones to adopt, followed by smaller cities.
Of course, the action right now is mostly taking place in the richer countries. But you can already see a nice amount of activity in Latin America, most of Asia and even Africa. The question is, when will the trickle there take off. What phone will play the role of the Droid in Mexico, for instance?
But there is no question that the flood is coming and that raises the hope to quickly close the digital divide. At Frogtek we are extremely excited and will be expecting it with excellent apps for the Base of the Pyramid.
Today at the Mobile World Congress awards ceremony our CTO Guillermo picked up the award for the best smartphone application that benefits women at the Base Of the Pyramid. As you can see in the picture, the award comes with a generous check of $10,000.
Other than the great recognition and funds, we’ll get special access to Carmel, a venture capital firm, and to Frog Design, a design consultancy.
So THANK YOU so much GSMA!! And special thanks go to Vodafone, Guillermo’s and my former employer, who sponsored the challenge.
UPDATE The official press release from the GSMA can be found here
>Two weeks ago Echoing Green held its annual conference for all its Fellows. It was a great break to get together with friends and fellow social entrepreneurs, learn about each other’s exciting developments and strengthen the bonds of a fantastic community.
As part of the weekend activities, EG hosted a Be Bold Summit with ten presentations at a beautiful venue in UT’s campus. I was invited to speak and decided to focus on the history of social entrepreneurship through a concept borrowed from Peter Singer: the expanding moral sphere.
Here you can see a video with the complete chat:
>It is well known that Moore’s Law models the exponential growth in processing power and the exponential drop in its cost. IT technology is constantly getting cheaper and better at a fast clip. But it is harder to visualize the impact of that progress in the sales and prices of electronic gadgets.
The Washington Post has just created a great visualization that shows this effect in the most common gadgets we use:
You can clearly see the exponential growth in US sales of feature phones and the reduction in their price. In 1998, the average one cost $268 and 27M were sold. In 2008, these numbers were $112 and 102,8M.
From there on, sales started dropping. Why? Simple: smartphone sales were taking off. From less than 8M in 2005, sales have grown to 54M this past 2010. Meanwhile, the average price has dropped from $537 to $325.
That’s a more drastic change than what we saw with feature phones. In my opinion, the reasons are the existence of honed distribution channels and the pull of the internet and apps. Since both causes are also present in emerging markets, I hope the spread of smartphones there will be even faster. And Google seems to think the same way!
>When we first thought about the most likely users for our product, we zeroed in on young males as more techie and thus willing to adopt our innovation. Well, as we have grown the network of users, we have seen that gender plays a very little role in the process. There are actually more women than men currently running their shop with our product! So much for preconceptions…
Below you can hear some of those female shopkeepers as they talk about our Tiendatek product and what they like about it. The prize for social impact goes to Damaris, who got her latest loan by showing her financial information on her phone to the credit officer at the microfinance institution.
To learn from the best, I follow several blogs written by Silicon Valley entrepreneurs and investors (check them out on the right column). It is a remarkable learning exercise to read about their experience at the cutting edge of the highest technologies. From them I first heard about Customer Development, Lean Startup, Business Model Generation and a few other key concepts that I believe apply as well to social enterprises. It is amazing to witness the creation of a start-up discipline and set of tools and I can’t wait for that wave to hit the social enterprise space.
But there are still a few differences when working at the BOP that make the transposition of these toolsets a hard effort. First, getting your hands on usable information is much harder. Not only there is almost no market research, the target customers can be suspicious and obtaining feedback efficiently from them is also difficult (by the way, this is a blessing in disguise: our data products will have a lot more value!).
Second, the speed of customer acquisition is vastly different. For the new wave of web and mobile start-ups, all they need to convert customers is in place: broadband, computers, smartphones… That allows for overnight hits and millions of new users per month. In contrast, as we try to bring business tools to the BOP we face a tiny installed base of smartphones, problems procuring them and expensive mobile data plans. Luckily the smartphone revolution is already picking up speed even in developing markets and this problem will solve itself nicely (there are for instance more than 20 Android models in Mexico today!).
A third big difference lies in the value of the solution brought to the customer and her perception of it. Since they come from far behind in terms of productivity and access to IT tools, the users have a hard time assessing value, which makes sales hard. On the bright side, leapfrogging a shopkeeper from medieval accounting practices to 21st century ones can greatly benefit her operation and also her self-esteem.
Of course, helping an underserved customer group like the shopkeepers is the whole reason we launched Frogtek. Despite the difficulties of bringing hi-tech products to an unsuspecting BOP, we are rewarded by slow but constant progress and are encouraged by the vast potential lying ahead. And as I like to say, if it were easy it wouldn’t be fun!
>The first three weeks in October I was lucky to speak in panels at three different conferences. It was a lot of traveling and a lot of exchanging business cards. We got in touch with amazing people from all walks of life and also got exposure for Frogtek’s adventure. Throughout these conferences I could see how the topic of social entrepreneurship has grown tremendously, jumping from a field of study in business schools to infecting mainstream thinking.
First I attended SoCap in beautiful San Francisco. This is the pre-eminent conference for the industry where more than 1300 attendees gathered to listen to the leaders in the field and to connect with each other. The Fort Mason center, next to Alcatraz, provided a fantastic setting for the buzz and hopeful energy from all corners of the world. It was truly impressive to see what the industry can put together, a clear coming of age in my view.
From San Francisco I flew to New York, just in time to participate in the Social Enterprise Conference organized by Columbia Business School, my alma mater. Since the first one I attended in 2006, the conference has moved from small classrooms all the way to the largest auditorium on campus. I’d be surprised if it’s not the largest conference of the year. A phenomenal success story, riding the student increasing interest to attract world-class speakers and even corporate sponsors.
And finally I went to New Orleans for the Daily Beast‘s Innovators Summit. This conference had a more mainstream focus with panels about the US economy and the growth of China and India. But the venue was chosen to highlight New Orleans’ fantastic rebound after the levee’s breakdown, led to a large part by a vanguard of social entrepreneurs. The mayor even offered his city as an example of fertile ecosystem for social innovators.
Actually, social entrepreneurs of all stripes featured prominently next to heavy-hitters like General McChrystal, Vinod Khosla and Barry Diller. And Echoing Green was a co-host, with our President Cheryl Dorsey intervening on stage at several points, including two panels with Fellows. The spillover was so infectious that the Daily Beast may choose Social Innovation as the anchor theme for their next conference.
Stringing the three conferences together, we can observe three distinct stages in the development of the field. First, the few initial practitioners triggered a tsunami of interest from business school professors and students, so the first conferences were organized at Columbia, Harvard and the like. Gradually the segment grew and captured talent and attention, to the point that the launch of the professional-focused SoCap in 2008 was a resounding success. And now the new ways of doing business are infecting the mainstream parts of the economy, with cutting-edge publications like the Daily Beast acting as vectors.
The future thus shines bright for the field. Hopefully it’ll catch up with its hype and won’t disappoint all the pragmatic idealists building the industry one conference at a time…
After two years running Frogtek from New York, I have now officially relocated to Mexico City. With the shopkeeper product ready for deployment, it is important that I come close to the users. This is particularly important as we start the iteration of our business model and engage our corporate customers/partners like the microfinance institutions and the large consumer goods companies.
So at the end of last month my dear Jane and I packed our nyc lives and brought them to this fabulous city. We found a cute apartment in La Condesa, a nice neighborhood with parks and a public bike scheme. And now we’ll start getting used to the city’s huge scale and bumpy rhythms. Hopefully we’ll soon feel like locals (I’m working on my accent!).
My favorite finding so far about Mexico DF: in the 17th century some powerful rains flooded the city under 9 feet of water. More impressive still, the city stayed flooded for five years!! The king almost relocated the thriving capital but in the end all the real-estate owners prevailed and kept it put. Crazy!
>Now that our product is ready for playtime, we have to experiment with different ways to reach shopkeepers to see what works best. In that regard, we are extremely happy to count with Coca-Cola’s support in Mexico. They have worked with us to develop the ad below for Tiendatek, which includes an implicit Coca Cola endorsement through the use of their logo.
The ad will appear on Coca-Cola’s national magazine, with an audience of 68,000 of their most dedicated shopkeepers all over the country. We’re looking for 100 to get started, hopefully we get more than enough responses.
The ad was put together by Kristel, our wonderful graphic designer, with help from others. We think it will resonate with shopkeepers both graphically and textually, would you have any suggestions about it?
Today five centuries and some years ago, Christopher Columbus completed a remarkable journey that connected two continents and radically shaped our ensuing history, both for good and bad. After such a feat, he became a legendary figure revered and hated alike. But if you look closely, you can see all the elements of a fantastic entrepreneurial story.
Let’s start with his industry, that of exploration, conquest and colonization of Atlantic islands. In the two decades years before 1492, Portuguese and Spanish entrepreneurs bloodily wrested control of Madeira, Cape Vert, Azores and the Canary islands. All these adventures were funded privately with the returns provided by the pillaging of natives and the establishment of sugar plantations.
Columbus participated in this trade industry, sailing north to Iceland and south to Senegal. He learned from the best, the Portuguese sailors, and became himself an expert in the new technologies enabling Atlantic voyages. Then he started dreaming of reaching a noble status, which at that time you could only achieve through feats of war or bold acts of exploration.
So he put together a half-cooked plan and started looking for funders and backers. He pitched and pitched, changing his story to suit his audience. And the audience was select, since only kings could help defend any gains from other rapacious kings. He tried Portugal, England and then Castille, where he was paid a salary to stick around and polish his plan. Today we call that an Entrepreneur In Residence.
After seven years of fundraising, he signed a deal with the Catholic Kings who had just unified all the smaller kingdoms in Spain. This document, called the Capitulations of Santa Fe, is plain and simply a Term Sheet. Its main points are quite familiar to a modern entrepreneur:
* Columbus and his descendants would enjoy the title of Admiral of Castile (there you go, a noble! that meant huge perks and privileges in a post-feudal society)
* He’d also be the Viceroy and Governor of all the lands he discovered (today we call that CEO)
* A tenth of all the profits from trade and other enterprises (that’d be a 10% equity stake)
* The right to contribute up to an eighth of capital for any ensuing enterprises (an anti-dilution clause!)
Once the deal was closed, the start-up got on to a full swing. The total capital deployed was equivalent to the annual income from a lowly noble person. The Crown provided about half, the other half coming from private investors, mostly Genovese financiers.
And off the three boats sailed, towards a direction no one had ever come back alive from (imagine the hiring interviews for the crew…). Columbus pulled it off though and pioneered a breakthrough route to the Indies, er, to the Americas. That sailing discovery started a grab for riches and eventually a huge trade industry between the two shores of the Atlantic ocean.
In pure start-up fashion, the story didn’t end so well. Columbus was a gifted sailor but a terrible administrator. He fumbled the management of the conquered islands so badly that his own henchmen asked the King for a replacement. So the main shareholder, worried about the bottom line, organized a board coup and brought him back to Spain in chains, only to strip him of all his entitlements. For the following three centuries, Columbus’ progeny fought the Crown in court to recover their fair due, sadly to no avail…
This story holds a few lessons for today’s entrepreneurs. First, we’re very lucky to risk only our money and time, and never our lives. Second, our profession has been going on and on since Adam and Eve. Third, don’t make deals with Kings!