An Introduction to Zamsolar

Write a summary paragraph: In about a paragraph, describe what problem you are solving, how many people are experiencing the problem, and what your solution is.

            One in four people in the world live without electricity. For light, they’ll spend as much a third of their budgets on candles, batteries and kerosene. They must also travel great distances to pay someone to charge their phones. This presents both a social problem and an economic opportunity. With falling prices of solar material and design innovations, solar portable products present a high value proposition to the off-grid consumer by bringing down the costs of light and power tremendously. Western suppliers have emerged to provide such products, however market saturation rates remain extremely low due to a lack of well-capitalized distributors employing innovative distribution and financing solutions. Zamsolar will develop these services, first for launch in Zambia, then East Africa and the rest of the continent. Our distribution strategies leverage partnerships with last-mile success stories, such as mobile network operators, mobile banking providers, NGOs and other existing organizations. To overcome issues in consumer financing, we partner with the industry leader in mobile pay-as-you-go technology. We believe that Zamsolar can be a model for sustainable development, using capitalism to alleviate poverty and promote renewable sources of energy.

Tell us more about the problem you are solving.  Why is it a problem and how big of a problem is it?

This is a problem that 1.6 billion people in the world face. Living without electricity does not mean living without light and power consumption: it means that these goods are extremely expensive.  We call this energy poverty. It is one of the most potent forces of poverty worldwide, because it prevents the wealth creation necessary to make extending the grid cost-effective. Yet it is also one of global poverty’s low hanging fruit, because we posses the technology to solve this problem. It simply requires the right kind of delivery.

Who do you think your target customers are and how many are there?

Zamsolar aims to reach as many of the 10 million Zambians without electricity as possible, however we first target consumers who have both light and power needs; ie, those with cell-phones. According to a survey conducted by AudienceScape in 2010, there are nearly two million people in Zambia who self-report high and upper-middle incomes (“We can afford expensive items such as a TV set or refrigerator” and “we can afford to buy whatever we want”) and who have either no electricity at home, or who receive it for half the day or less. There are more than a million more Zambians who self-report lower-middle incomes (“We have enough money for food and clothes and can save a bit, but not enough to buy expensive goods such as a TV set”) who lack consistent access to electricity. Thus, our initial target customers constitute a population of over three million.

Do you think your customers are looking for a solution?

Tell us about your solution.  How does it work and what are the benefits?

II. Delivery. Distribution and financing are at the core of Zamsolar’s identity. To be sure, there are plenty of well-designed, high value products in the market. The problem is not product development, but product delivery. Zamsolar will take advantage of existing sub-distributors and retailers, including local hardware stores, big box stores, solar shops and NGOs. We will also develop a local propriety sales force, and establish some retail presence. However, in order to reach “last-mile distribution,” we will test strategic partnerships with the best existing networks. In order to do this, we leverage complimentary products. We hope to develop approaches that can be applied worldwide.

Example 1. The MNO Partnership

It has been said that no one has had a greater impact off-the-grid than cell phone companies, also referred to as mobile-network operators (MNOs). MNOs like Airtel—Zambia’s largest and fastest growing—reach far deeper into rural Zambia than any other distribution network. Airtel has agreed to partner with Zamsolar to test the efficacy of a complimentary product—an inexpensive solar cell-phone charger—pared with their distribution network.

         How the partnership works. MNOs like Airtel make their money by selling talk-time via prepaid scratch cards. Although they have been highly successful in reaching off-grid customers, their consumptio

n of talk-time is severely limited due to the high expense of charging their phones.These means that their phones are on less often, and that much of their cell phone budget must go towards charging the phone. An inexpensive solar cell phone charger would help to solve this problem, boosting talk-time consumption, by bringing down the price of charging. For high-use consumers like Charles, pictured to the right, a $12 solar cell phone charger would pay for itself in a month, and save him $152 in a year. 

Example 2. Mobile Money and PAYG

            “Mobile money” has become a hit in many African countries. Mobile money programs, such as those currently being developed by Barclays in Zambia, allow users to transfer funds and make payments via phone using SMS. While such programs have been tremendously successful in other East African countries, such as Kenya, Zambian mobile money programs remain relatively small.

What's your plan for developing your product or service including some dates and milestones? 

December 2011: We conducted a due-diligence trip in Zambia to build a local board of advisors, access distribution strategies and customer preferences, and research logistical issues such as incorporation. We have reserved the name “Zamsolar” and are prepared to incorporate.

July 2013: We intend to have raised sufficient capital to launch a 6-12 month pilot in Zambia, testing financial and distribution strategies and demonstrating “proof of concept.” ($150k+)

            October 2012: Scale up to 20 distribution channels.

            January 2013: Secure distribution agreements with MNOs.

            July 2014: Expand to East Africa to address a market of 34 million off-grid households.

January 2016: One million units sold.

Tell us about yourselves (Who is on your team, what are you studying, what year are you)

The three founding partners, James Sawabini, Thomas Smyth and Andrew Clay, attended high school together at Phillips Academy in Andover, MA. There they were good friends and worked together in a number of respects. James went on to Duke, Thomas to Yale, and Andy to Dartmouth.

James Sawabini, Duke University, Trinity 2012. James will graduate form Duke University in 2012 where he pursued a major in History with a concentration in Business and Economics, the PPE Certificate and an Economics minor. James first became interested in African development while teaching English in a low-income suburb of Accra, Ghana, before attending college. At Duke, James has worked as an assistant to the University President’s office, while also serving as a member of Dukes and Duchesses and as a partner in a student-run emerging markets fund. 

Thomas Smyth, Yale University 2012. Thomas spent his past summer in Zambia distributing solar portable lights to schools with an American nonprofit. He fell in love with Zambia and its people, and envisioned Zamsolar as the best way to encourage economic development for Zambians. Thomas is a senior at Yale College majoring in Political Science and writing a senior thesis on cell phones and cosmopolitanism in Africa. He has conducted research on apparel factories in China and Sri Lanka and worked for the Century Foundation, a progressive think-tank in New York City.

Use of Funds - if you won $50,000 how would you use it?

            The $50,000 would constitute a significant portion of the costs of our initial pilot. It would go towards the operating costs of the business, overhead and inventory. We have already solicited interest from a number of investors. The $50,000 and the program’s imprimatur would help to solidify their confidence in our project and would likely result in the completion of our fundraising.

Our board of advisors:

Jack Leslie, Chairman of the U.S. African Development Foundation and CEO of Weber Shandwick

            Paul Kaluba, Zambian Country Director, Coca-Cola

            Chishimba Yumbe, Director of Finance, Bank of Zambia

            Bradipan Gnanasivam, Director of Business Development, Konkola Mines

            Gordon Brown, Country Director, Africare

            Chiselebwe Ng’andwe, Lecturer in Economics, University of Zambia