For the last three years the founders of Stima piloted ways to bring pay-per-use solar energy to the

poorest communities in Kenya. They experienced first hand how power changes lives. A girl rose to the top of her class reading by LED light. A brick layer doubled his business by keeping his phone powered on. A user introduced the idea of group guarantee, which when implemented in trials, tripled collection rates within weeks. Another pilot user recruited 70 users from neighboring home villages and generated five times the average daily income from pilot commissions. These and other Base-of-Pyramid user innovations demonstrated a world of possibilities starting with the way to bring modern power to remote villages, while saving money and generating revenue for all parties involved. Stima was founded to profitably address pervasive demand for affordable energy at the Base-of-Pyramid. Stima means "energy" in Swahili and "esteem" (where we get the word) in Latin languages, or, in other words, "power and empowerment". We bring power to people and empower them to participate in the operation of our service, the recruitment of their fellow community members, and the formation of groups to co-guarantee payments. At the Base-of-Pyramid people are held back by expensive energy and lack of financing: energy in rural villages costs 15 times more per unit than what you and I pay. The further kerosene travels from an urban center, the higher the cost. Efficient energy simply has not been accessible to the rural village. Even a $6 solar torch, which can reduce kerosene usage and pay for itself in a little over two months, is too much to pay for out-of-pocket. The reason has to do with the second problem, the economics of poverty, which dictates that cash on hand is more valuable than spent, even on a solar product that can save in the long run. That is why billions of poor people still buy expensive kerosene daily. The solution is to offer modern energy as a service; paid for in small amounts to fit rural spending habits. There are 200 million rural families living in India and Africa at the 'Bottom-of-Pyramid' who could save money with Stima, enjoy brighter lighting and better phone access. That's over a Billion people!

Problem | Opportunity | Solution

Problem: 10% of the world's population, or 1/3rd of the base of pyramid, is too poor to buy even the lowest cost solar product, yet spends 15 times more on inefficient alternatives simply because they fit cash-on-hand. Opportunity: For families living off $1 to $4 a day, energy approaches 30% of household expenditures and families develop two behaviors in response that make Stima's approach a natural and symbiotic fit: energy is managed daily and families band together with community members to smooth cash flow so they can cover daily expenses in the absence of consistent daily income. As the saying goes, individually they are bust, but together they are strong. This target segment has proven itself to embrace the methodologies that Stima uses. In fact, Stima adopted the methodologies from customer feedback. In pilots leading up to Stima, the founders also discovered that those earning below $1 a day burn firewood and don't budget daily for energy and at incomes above $5 a day, energy drops to 10% of income and families rely less on communities to smooth cash flow. These users drop out of group meetings over time as they not take recruitment of fellow customers as seriously. Solution: Stima's solution is 4-fold;

1. Low-cost portable solar chargers and lights with Stima's patent-pending payment control technology inside 2. Pricing model that fits cash-on hand 3. Group guarantee methods honed over 3 years in Kenyan pilots to ensure payment 4. Franchised distribution; leveraging local entrepreneurs to reach deep into the village

Stima embeds a patent-pending control chip into a portable solar charger so it shuts off every week unless payment is received over a mobile phone. This allows Stima to turn any solar charger into an affordable pay-peruse service that fits cash-on-hand and eliminate all upfront fees that create barriers to adoption. Stima recognizes value and technology alone are not enough to operate a sustainable business when serving a target segment that has unreliable income. To ensure collection, Stima leverages proven group financing practices, common in our target segment, which requires users to co-guarantee payments. With Stima, interested users recruit 10-20 additional users whom they trust, form a group and agree to co-guarantee full payment. If one person does not pay, no one is reactivated, forcing the group of users to self-enforce payments. Over time, Stima solidarity groups become stronger and leverage their combined finances to invest in other opportunities. Finally, to cost-effectively reach deep into rural villages, Stima distributes chargers under a franchise model; leveraging rural entrepreneurs to oversee recruitment and payments by groups. These "Agents" manage upwards of a hundred users with a "Money Key" that ensures payment collection or service expires. Portability and simplicity are important; an Agent carries 50 chargers into a remote village on the back of a bicycle and firsttime users figure out how to charge phones and turn on lights within the first sunny day. Just like the controlled chargers, the Money Keys also expire ensuring controls throughout the channel. Stima combines affordable pay-per-use energy with control technology, proven methodology, targeted income groups, and well-connected local entrepreneurs to ensure reliable collection, viral growth, measurable impact, and fair profits for STIMA and channel alike.

BABABABABABABABABABA

Stima works in rural Kenya, where energy to charge a cell phone often costs more than making a call. This is the case across much of the developing world, as a result, most cell phone users will turn off their phones between calls to save power. Stima decided not to sell, rather to rent the chargers for local people to charge their cells. People pay for the service, not to own the equipment. The reason:"....By selling a product to people in the BoP you are taking away their liquidity, and in these communities, they need to have cash on hand, cash is power. Hoes does Stima's model work? Stima distributes chargers under a franchise model, leveraging rural entrepreneurs to recruit and manage groups of users who co-guarantee weekly payments. These "Agents" manage up to several hundred users with a "Money Key" that ensures payment collection or service expires. The Money Key, a small USB-like device which activates a specific set of chargers, is a simple yet effective way to regulate payment and in-person interaction between Agents and users. In my opinion one of the keys to their success is the fact that they use a group payment scheme, whereby each week the group is responsible for paying the lump sum and thus can support each other to make sure the payment is made. Distribution: The chargers are small and portable, so a locla enterpreneur can carry 50 into a remote village on the back of a bicycle. Lessons from Stima's work model: Dont sell. Have an added motivation for users to follow the process rules. For Stima this is the timeout of chargers if users dont bring them in each week and pay for them to be reactivated by the key.

Work in groups. Have responsible and reliable agents who are trusted in the communities involved with the franchise. Keep it as simple as possible, which means costs can be low and confusion minimal no sales, no marketing, no delivery to the last mile.

Synopsis
How to empower a community to grow education and bolster an economy with micro-leased portable solar chargers. Konrad App joins me today to discuss how Stima Systems has provided rural Kenyans at the base of the pyramid, people who live on less than 10 dollars per day, with an opportunity to thrive.

Interview Notes

base of the pyramid. 80% of people who live under 10 dollars/ day portable solar chargers become micro leasing chargers with a special security chip lease them to people who are at the bottom of the pyramid. people who live on 1 -2.50 dollars per day why franchise? these people spend 30% of their income on energy per day most energy is kerosene for light. which isnt good for their eyes, their lungs, environment, and even worse on the wallet

stima provides a way for these people to get modern tech without having to buy it @ 2.10 Elise Acheson Why Kenya? James Kimisoi, head of justice and peace conflict created needs for current energy infrastructure startup cost is too high to justify buying solar chargers themselves much potential for solar development in kenya about 70% of the country has cell phones people will write their cell no. on their hut, because theyre so proud of it the cell phones are old, 7-8 years old. sometimes 5 people share a cell phone and have their own sim card. sometimes have more than one sim card @ 5.00 the past way of charging the cell phones it costs more money to have the phone on than it is to make the call cell phones vs land lines. because most people can not keep their cell phones on, when they try to call someone else the recipient of the call wont receive it because they will have their phone off. note: not many land lines prevalent

once the people have power to their phones, they will keep it on for set times children are often in the urban areas of mumbasa, and nairobi and will send money back through the phone. many people have jobs and need the cell phones for that how to build community with the solar chargers

@8.00 the story of idea inception to where it is today initial 1000 solar chargers were donated some difficulties faced: if you make $1 2.50 per day. there are already practices in place where you would scrape the can to get the last kerosene out of it. when you lit the lamp, people would be gathered ready to read and use the light to its most efficient minute. daughters often go out to collect wood for lighting

when you have an income that is closer to $5 per day, then energy is not a 30% of your income. youre able to buy kerosene in bulk, or a hurricane lamp which is much more efficient

keeping capital is the most important part at a certain income level at the base of the pyramid, its not possible to buy products. the only product in their hut will be a cell phone

@ 14.15 womens group example in the beginning of the group meeting, they all put in 20% of their income into the box. by the end of the meeting, they have to

@15.40 whats next for Stima time based chip in 5 years projection. little over a million users primarily in Kenya Goal is to move towards in India womans groups are very popular in Kenya lots of blunders, but that is the best part! and the way to learn @19:30 -the need for other social enterprises to pop up. their main technology is the pay per use model. water is a big deal! in the mornings, girls walk out with empty jugs on their head, and come back with with water in the afternoon.

cookstoves are needed as well. partnerships are a huge aspect in the african world. the only way to make a successful enterprise. @24.05 stumped cell phones and lighting lighting is more important than their cell phone charging lights have a status symbol in kenya. if a family runs out of money, they do everything they can to light their lamp for an hour per night to show their still in business

the clients love the cables! to show the electricity empowering girls education they are spending 50x more for the same activity, in terms of energy, agriculture, water and more on an income drastically lower

Kenyas 42 tribes are very helpful to empowering people and bringing education up

About Konrad App

For the last three years the founders of Stima piloted ways to bring pay-per-use solar energy to the poorest communities in Kenya. They experienced first hand how power changes lives. A girl rose to the top of her class reading by LED light. A brick layer doubled his business by keeping his phone powered on. A user introduced the idea of group guarantee, which when implemented in trials, tripled collection rates within weeks. Another pilot user recruited 70 users from neighboring home villages and generated five times the average daily income from pilot commissions. These and other Base-of-Pyramid user innovations demonstrated a world of possibilities starting with the way to bring modern power to remote villages, while saving money and generating revenue for all parties involved. Stima was founded to profitably address pervasive demand for affordable energy at the Base-of-Pyramid. Stima means energy in Swahili and esteem (where we get the word) in Latin languages, or, in other words, power and empowerment. We bring power to people and empower them to participate in the operation of our service, the recruitment of their fellow community members, and the formation of groups to co-guarantee payments. At the Base-of-Pyramid people are held back by expensive energy and lack of financing: energy in rural villages costs 50 times more per unit than what you and I pay. The further kerosene travels from an urban center, the higher the cost. Efficient energy simply has not been accessible to the rural village. Even a $6 solar torch, which can reduce kerosene usage and pay for itself in a little over two months, is too much to pay for out-of-pocket. The reason has to do with the second problem, the economics of poverty, which dictates that cash on hand is more valuable than spent, even on a solar product that can save in the long run. That is why billions of poor people still buy expensive kerosene daily. The solution is to offer modern energy as a service; paid for in small amounts to fit rural spending habits. There are 200 million rural families living in India and Africa at the Bottom -of-Pyramid who could save money with Stima, enjoy brighter lighting and better phone access. Thats over a Billion peop le!