Rethinking business: building businesses that solve social challenges in Africa!
BIG or small - we believe businesses can address pressing social issues (and be profitable!). We will support them to find this balance.
Explain your project idea (2,000 characters)
Starting in Zambia and expanding to other markets in Africa that are still seeking pathways out of poverty, small and medium (SME) businesses will be supported to address pressing social challenges through innovative and durable business strategies. The idea addresses the current limitations of business strategies that are driven by immediate short-term profits. In Zambia in particular, the pertinent social challenges that will be addressed are: high youth unemployment rates (48.6%)- notably with disadvantaged youths-, rural poverty, food insecurity, malnutrition, deforestation and the use of non-renewable sources of energy.
Agova is a consultancy that uses a unique approach to solving social challenges. It implements shared value business strategies (http://www.sharedvalue.org/about-shared-value) - where businesses address social challenges, all the while being viable and profitable. Businesses are supported with developing competitive strategies that meet the needs of higher-risk, lower-income and more fragile customers. This means supporting a business to better understand their customers (through human-centred research approaches), developing and testing a new product and service for their customers (whilst embedding systems that generate data on its performance) and ultimately, either pivoting or growing the said business model. Agova has already proven this model with larger corporate actors and now sees a clear opportunity to bring these competitive business strategies to the SME sector.
Agova will do this through its two new key business streams:
1. Embedded consulting services: young Zambians will be trained as junior consultants to provide tailored and affordable consultancy services for SMEs focussed on the design and implementation of ‘Shared Value’ business models;
2. A co-working space: a space designed to meet the specific needs of SMEs by providing access to affordable working space, resources, group trainings and consultancy support.
Who are the beneficiaries? (1,000 characters)
The beneficiaries of this idea are three fold:
This video showcases some testimonials from beneficiaries of the SME-targetted pilot services that Agova is currently delivering in Zambia: SME 'Tailored Consultancy' services and the co-working space 'Shared Value Hub' pilot. Beneficiaries include Zambian young people - the junior consultants employed to deliver Agova's tailored consulting services - and the SMEs, who were the first users of both pilots.
This video showcases some of Agova's past work in Zambia, and notably the two key business streams piloted with this idea: the tailored consultancy services and the co-working space 'shared value hub'. The section on the tailored consultancy services includes work that has been done with corporate clients, on top of SME clients. The aim of the idea proposed in this application is to focus solely on start-up and SME portfolios.
1. Unemployed youth in Zambia - and Malawi and Zimbabwe - who consistently represent the majority of the unemployed demographic, who will form the local workforce of consultants, providing 'embedded' consulting services to the start-ups and SMEs. Youth is defined as a person aged between 15-35 years old. The youth unemployment rate in Zambia in 2017 was 48.6%.
2. Start-up businesses and SMEs, that demonstrate the motivation or the initial development of an innovative inclusive business model. In Zimbabwe, the SME sector represents 60% of the contribution to GDP and 73% of employment of the workforce. 3. The indirect beneficiaries served by the SMEs exposed to our consulting service - these have typically been rural farmers living in extreme poverty and urban poor subject to health and environmental risks (and other supplier/customer segments). There are 2 million rural farm families in Malawi, most of which are still subsistent.
How is your idea unique? (1,000 characters)
Our uniqueness is in the HOW: our consultants are Zambian youth embedded in companies over an extended period of time (6 - 12 months), allowing the consultant to absorb the client's culture and as such, tailor their work to the client's needs. This provides the necessary 'co creation time' required to support the development a company's shared value strategy - leveraging notably human-centred methods - and allows for 'change' beyond business model development: organisational change and process improvement, for example. This model is one we have successfully implemented with large clients, and which we believe can lead to even more impactful change at SME-level. This is what makes us different to the Dalberg's and Imani Development's of this world, who offer more 'traditional'-type short-term consulting projects in a similar space. We develop tailored business models, but what make us unique is that we provide support in implementing them.
Idea Proposal Stage (choose one)
Early Adoption: I have completed a pilot and analyzed the impact of that pilot on the intended users of the idea. I have begun to expand the pilot for early adoption.
Tell us more about your organization/company (1 sentence and website URL)
Agova is a business development consultancy and research hub which works with private sector actors - from start-ups to corporates - to design and implement business models that provide solutions to socio-economic challenges whilst meeting our clients' commercial mandates.
Organization Filing Status
Yes, we are a registered non-profit.
In 3-4 sentences, tell us the inspiration or story that encouraged you to start this project.
2 years ago, we identified a gap in our strategy to work with a range of business actors in Zambia: we were not reaching SMEs with our services because we were not tailored to meet their needs and our pricing presented a barrier. We therefore set off to understand this segment better: we used human-centred research and design approaches to understand the BDS gaps in the SME sector and designed services with them, for them! We tested these, 'proved' their value, are are now ready to grow them...
Please explain how your selected topic areas are influenced, in the local context of your project (1,000 characters).
Given that our idea touches on a multitude of potential sectors, some of the key things that are affected in the context of Zambia are: unpredictability in rainfall in recent decades and extreme droughts (2015) which affects rural communities' livelihoods, lack of government investment towards education and job-readiness support for youth, reliance on mining (and copper) as the main source of the country's revenue which means the country's economy and currency are highly dependent on global copper prices and trade.
In markets such as Malawi and Zimbabwe, the aim would be to leverage our strengths and start by working in the sector where we have the most expertise: the agricultural sector, to address rural poverty, food security and malnutrition. In both markets, the agricultural sectors are highly vulnerable to rainfall variations and the spread of the army worm. There is also a lot of uncertainty due to the upcoming elections that both countries will be having in 2018 and 2019.
Who will work alongside your organization in the project idea? (1,000 characters)
We have developed a strategic partnership with a local Zambian NGO - Musika (SIDA-funded) - that aims to unlock private sector investment in small-holder markets. We have collaborated with Musika over the past 3 years to test out our consulting services with both large and small agri-businesses, and this has allowed us to refine our services, in readiness for the market. For example, Musika are currently part-subsidising our consulting fees to develop a business model with a local SME - Goat 'n Chips - that aim to source goats from small-holder farmers (SHF) in rural areas. We are on the ground, working with 30-40 SHFs, using HCD methods to understand how the business model could be developed and implemented to benefit all parties. Musika have a large network of small businesses and SHFs they work with and are aiming to reach 800 rural businesses with training services by 2021: we would leverage this. We would look to other partners to scale our services to non-agri sectors, eg. PEPZ.
Please share some of the top strengths identified in the community which your project will serve (500 characters)
Strengths identified in the community where we operate:
- Large number of high potential start-ups and SMEs coupled with a lack of service providers providing targeted and tailored services for innovative business model development
- Surplus of talented, educated, young people ready to work. Youth unemployment rate of 48.6%.
- Variety of sectors where economic growth is taking place, that have the potential to address social issues: agriculture, mining, tourism, hospitality, and energy.
The idea targets Zambia's start-up and SME sector, as well as potential new markets (Malawi, Zim)
How many months are required for the project idea? (500 characters)
Give we have passed already piloted this idea in Zambia over the last year, and are now refining the business model, this idea could be fully implemented within a 18-month timeline. Going into new markets (in Southern Africa and potentially other regions as well) to test the idea, alongside implementing it in Zambia, would require more time: 36 months.
Did you submit this idea to our 2017 BridgeBuilder Challenge? (Y/N)