Posts by Jonathan Gosier
Tales of a Social Capital Startup - Part 1
Published April 03, 2009 @ 10:30AM PT
In mid-2008 I moved to Uganda and started a private sector incubator for East African entrepreneurs in software and technology called Appfrica Labs. For more more on my motivations for doing so check out this video interview I participated in with Jonathan Marks two weeks ago in Austin, Texas. In only two months we are well on our way to becoming 100% sustainable and completely profitable. It thought I'd write a bit on the philosophy behind my decision, why I used a for-profit model versus a non-profit model and why sustainability was my primary focus even before seeking investment.
For-Profit Versus Non-Profit Models
If you ask a lot of developmental aid workers in many BOP markets what's missing from the big picture, almost unanimously they will tell you: sustainability and accountability. While it's not my goal to criticize the non-profit or NGO model, I think there's a certain level of unchecked abuse from both sides. One adverse effect is that it leads to a sense of entitlement and expectation from local groups benefiting from the relationship. Here's a real example that a friend who directs an NGO shared with me last week.
This large organization here in Uganda gave some products to one of it's local partners for a temporary program. The products weren't intended to stay forever, but after the program was over they were left at the group's facilities. The group gets 100% of it's operational costs from this donor group so I suppose they just assumed these products would be treated the same way. Only that wasn't the intent, the Non-Profit eventually planned to move them elsewhere. And whether it was due to miscommunication or poor direction, the non-profit sent a message asking for the product to go somewhere else. The local group responded with a drawn out excuse about how they needed the product, now, because they'd built programs around it. In fact, they needed them so badly that it would destroy the program if they had to give them up. (I'm deliberately vague so as to protect the identities of both parties.)
And so it goes in a lot of other situations. The local group has become dependent upon their benefactor, as far as I know, there's not even a thought about sustainability. In this case that might be all that's expected of them, but I feel like this game plays itself out in far too many institutions here. My goal with Appfrica Labs was to apply a for-profit model to social development. Appfrica Labs is an incubator and VC space, we fund entrepreneurs but given the market we have to do more than that. Even at university level, education isn't perfect so a big part of what Appfrica Labs does is expose entrepreneurs to new programming languages, new techniques and new ideas, while also offering the facilities and equipment needed to do it all. We pay our incubated entrepreneurs so that they can focus on being innovative and experimental while not being distracted by other jobs or financial worries. It's an attempt to create opportunities in a market where there are a few, otherwise these self-motivated individuals will go abroad to find opportunity or they'll give up on their careers, neither of which is good for the local economy.
The reason I chose a for-profit model was simple. I would have felt like a hypocrite telling these guys to start for-profit businesses, if I wasn't running one of my own. The whole 'do as I say, not as I do' paradigm. It also teaches the lesson that failure is a harsh reality, and if you don't work hard the opportunities you've been given will go away. In my opinion, there's no need to sugarcoat that, it's the reality whether people choose to accept it or not. There's also my personal defiance to everyone who questions whether or not for-profit models can work in Africa, especially in areas of software and technology.
The Real Disadvantages
My biggest challenge, a problem I share with many blended model companies, is that it's sometimes difficult for non-profit organizations to find ways to work with a for-profit. They're bound by policies that say that they can only work with other non-profits. It seems like for-profit social capital, blended-model, or double bottom-line business is a huge gray area when it comes to funding. Most Large for-profit organizations want to donate or partner with non-profits so that they can ensure they are getting the tax advantages of doing so. Non-Profits and NGO's are often bound by strict rules that were created to ensure that they are legitimately non-profit entities. This means they can only contract other non-profit groups. Models that fit outside of those archetypes have a hard time raising capital.
For me the sustainable part of my model is two-fold. We can afford to pay the people we incubate because in addition to working on start-up ideas in a traditional incubator-angel-startup model, we also complete projects on a work-for-hire basis. For my company this works because the work-for-hire projects are often an opportunity to teach people new things while also adding to the bottom-line. It does mean we end up doing a lot of work that isn't innovative or 'our own', but that's the reality of starting up with a model like this. Once the model is proven everyone wants a piece, until it's proven no one cares. In a way, I'm still bootstrapping. Before I found an investor, this was also my business model, the investment just allowed me to scale up to an office and more employees.
I'm curious to hear from other blended-model start-ups. What are your experiences with funding and partnering with larger groups?
This is Jon Gosier's second guest column for Change.org. Jon runs Appfrica Labs, a tech startup incubator based in Kampala, Uganda, and writes on technology, Africa, and the perils and potential of working in a global startup.
Digitizing the Moment: The Realtime Web and the Developing World
Published February 27, 2009 @ 08:07AM PT
(Photo via DigiActive)
One of the break-out trends of web communication is the push to get ever closer to the moment of events, as they happen. It began with instant messaging and chat rooms and extended into SMS and eventually micro-blogging. Earlier this month I blogged about the role Twitter played in alerting people about a fire that was occurring in downtown Nairobi, Kenya. Incredibly, I (and hundreds of others following Twitter user @kahenya) knew about the full sequence of events in detail before even the local affiliates were on the scene! The same scenario has played out time and time again (most recently in India and in China). The current buzzword for this trend is 'the realtime web'. That is, those people all over the world connected by PDAs, Smart-phones, mobile devices, netbooks, desktop computers etc. and what they are doing as close to 'now' as one can ever hope to get (before it becomes 'then').
Ever Closer to The Moment
So far the real-time web is even in it's infancy in the first world, but what do these new technologies mean for developing nations?
Souktel is a Palestinian start-up that uses SMS gateways to distribute and aggregate Job and Aid information in the West Bank. It's an incredible resource during times where travel, communication and even power are cut. Theoretically, mobile operators would be the last form of information to go down in a crisis situation. The infrastructure is sparse enough, and the staff displaced enough to keep a network up through whole conflict if necessary. Unlikely, but possible. Still, the value of Souktel to the region is hard to really quantify, if only for the speed at which information can be shared rather cheaply. Most recently Al Jeezera partnered with Souktel and the mobile incident reporting tool Ushahidi for a project that allowed citizens living in Gaza to build and view collaborative comprehensive maps (using Microsoft's Virtual Earth) of both critical incidents and aid necessities. These maps also included Al Jazeera's news coverage mapped by location as both text and video.
This is where the power of the real-time web applications really shows itself. Living half-a-world away from something as tragic as a mortar blast, you can know more about that moment in time right down to the hyper-second, than the people who were there to witness it first hand. Video from multiple angles, multiple first-hand accounts both in micro-blog and blog form, informed reporting; all these things culminate to create an experience that would make the writers of the movies EAGLE EYE (2008) and ENEMY OF THE STATE (1998) proud.
The Use-Case
Let's imagine the following scenario:
The fictional African nation of Bamzia is at an international, humanitarian stalemate. The world is watching but information can't be distributed through normal means. But a woman is walking from her village with a small device that carries the hopes and prayers of her neighbors. She doesn't know how the device works, she barely knows how to turn it on. It may as well be witchcraft as far as she concerned, but she knows that the contents are far more valuable than the device itself. She makes the long track from one village to another to see her ailing son, but before she sees him she hands the device to the town Elder who then hands it over to his son.
Weeks ago, an aid worker had shown him how to use it. 'Just press this button, all you have to do is press this one button.' He remembers only that part. Nothing about the fact that this device is a mobile server capable of broadcasting, short-range, to a number of similar devices. Nothing about the fact that tens, if not hundreds of emails would be distributed to a local area radio network (either wifi or bluetooth) that would then distribute those emails to computers and mobile devices alike. He just knows that when he presses that button, the village will receive news about whether or not the rebels or the government have won, whether someone's sister or father has been killed, whether or not the daily football score was in favor of his country or another...
While not exactly an example of real time web communication, in the above scenario I'm describing mobile devices capable of asynchronous storage and broadcast via radio device. 13 million people carry such technology around in their pockets everyday in the form of an iPhone or any number of other mobiles. With a powerful enough antennae and wifi-boster, even the iPhone could be used for point-to-point communication with another iPhone. The point is, the technology is there, the capability is there, it takes very little effort for people to repurpose what you and I might consider a luxury, to be a positively disruptive technology. In this case using mobile devices as peer-to-peer nodes that can be used for real-time messaging or time delayed delivery of bulk messages.
The New, Agile Short-Wave Radio
Of course, the real value in this technology is in the ability to allow the average African country citizen to bypass the media, to bypass the government and even in some cases, to bypass the carrier; to deliver messages to loved ones, humanitarian workers or peace-keepers. People have done this for decades with the aid of single-sided short band radio broadcast stations. The difference is now the broadcasting and the station itself is far more agile. It fits in your pocket, it's hard to even tell when messages are being distributed or received. You can use them with the command line, a touch screen GUI, a stylus or your voice. Mobile devices come all shapes and sizes, from all manufacturers. The one constant is the ability to use a variety of protocols to transmit and receive digital information...usually far beyond the reach of the people who would be inclined to suppress that communication.
Even when the message is being suppressed, with tools like Feedelix and FrontlineSMS, users can truly use devices as disruptive point-to-point communication independent of infrastructure entirely. Feedelix was born out of the need to spread unfiltered information when the Egyptian government began censoring all communication using the countries SMS gateways. To bypass these blocks, the creators took advantage of other capabilities of the phones. FrontlineSMS is software plus some hardware kit that literally turns any PC into an local SMS or MMS gateway. Barring interception or scrambling technologies (which are available), it's the perfect form of communication off the grid. In this case, the realtime web would allow people in the field or in other such 'hot zones' to communicate with a central base or controller easily.
In conclusion, the realtime web is the evolution of a number different technologies we've seen before: the short-wave radio, internet relay chat, the instant message and SMS/MMS. In the form of micro-blogging, we can contextualize these moments with immaculate detail using maps, video and other data available via the web.
