We had these challenges too

Recently a friend asked about African culture, and specifically our Kenyan Social Entrepreneurs: “does their laid back attitude actually contribute to their poverty?” Now I know this friend well enough to know he was genuinely asking, not trying to pass judgment. In answer to this question, I present to you: a washing machine.

When I see that pile growing in my laundry basket I feel a dread come over me. I will have to budget time to address the burgeoning pile or risk wearing gym shorts as my underpants (not that I’ve ever done that).

I will have to throw the clothes in the washer, be around an hour later to move them to the dryer, and…the part I always screw up…remember to take them out of the dryer before they are a wrinkled mess (sorry honey). Oh ya…and folding. So, all in all about 30-45 minutes of work spread out over a 3 hour period.

Now let’s contrast this process with the work of a prototypical Kenyan social entrepreneur names Joy:

• Water: the more fortunate might have indoor plumbing which works 3 or 4 days out of the week. The less fortunate go to a community filling center, and can only purchase what they can carry (this is almost certainly a woman doing this work)
• Bucket or tub: pour the water in the tub
• Soap: If you’ve ever washed your clothes camping, you know hand washing isn’t glorious. There’s no hand-friendly organic soaps available, and you certainly can’t afford the luxury of gloves
• Hands: It strips your hands of oils, and getting out those tough spots requires more than a little elbow grease
• Drying & Folding: Drying is done on outdoor lines, which leaves clothes stiff…not to mention the rain conspires to set back the drying process several days

All in all, I have to guesstimate, a 6-8 hour process spread over 3 days. “Ok,” you say, “they have a harder time washing their clothes.” But this isn’t an isolated incident, this is every basic task of living

• Without online or telephone banking, going into town to check your bank balance could take 2-4 hours
• Getting to the market for food could be a 30 minute to 2 hour walk
• Preparing food over a charcoal fire, with most elements starting from “scratch” could take 1-2 hours
• If a child gets sick, and you can’t afford health care, everything else could go on hold for days

Now imagine you are trying to run a social venture with the rest of the time you have left? If you are trying to be productive and task-oriented, how long would you last? Is being strictly task-oriented unquestionably a good thing, even in our culture? The fact is, the utter lack of what we would consider “basic infrastructure” conspires to complicate every basic task.

Every time you throw some clothes in a rinse cycle, remember the cycle of poverty and ask yourself how you can responsibly intervene.

The Wall Street Journal recently asked eight prominent philanthropists and NGO executives how they would spend $10 billion to achieve the biggest and longest-lasting impact on the world’s problems. All eight came up with great ideas, but the clear winner in my opinion came from leading Swedish businessman and philanthropist Percy Barnevik, who said he would use the money to unleash the entrepreneurship of the world’s poorest citizens.

My experience in Africa over the past 27 years has convinced me that this is the only way for people to break out of poverty. People are poor because they have no sustainable income. It’s as simple as that.

via allAfrica.com: Africa: Create Jobs in Continent, and All Else Will Follow.

$10-15 is a common loan from the Community Based Organizations (CBO’s) we support like Mother’s Concern and Tumaini Pomoja. In February I met a woman who turned such a loan into a $75/mo business that allowed her to overcome the major obstacle of school fees for her 6 children, pay rent, and help break the cycle of poverty for her family.

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Chuck summarized a major “takeaway” from his time in Kenya as he described a training he is to give here in Denver

…the Cycle of Poverty is a serious problem even for seemingly successful business owners here in the U.S., because once you fund something (in the case of Kenya- micro financing is the most common method, here it is either our own savings or a loan from a bank), that actually doesn’t solve anything.

The business owner then needs very significant training to change their mindset about how successful business happens.  Without that change in mindset, all we do is temporarily raise our standard of living or business position because of the loan.  If we haven’t made the right decisions what to do with the loan, once we pay it back and the loan money runs out, our business reverts to where it was before.  It is HOW we use the loan and how we reinvest the higher net profits possible that is the key to breaking the cycle of poverty.  This is a problem both in Kenya and here – business owners don’t use their loan properly to set themselves up for sustainable business.

To that end, we did our first business training for business owners before I left and I put together two more months of training to get us started helping these business owners make the kind of investments that will create a sustainable business.  After getting back here I realized that the problem is identical here for business owners who are well past subsistence – they still are slaves to their business, can’t leave for a week and expect things to be running well when they get back, and when their loan money runs out, they need to go get another one or their business reverts to where it was before the first loan.

I’m going to use the same exact training I used in Kenya today to make my point.  I think it will be very eye-opening to these seemingly successful business owners to realize they aren’t any farther along except that their “poverty” is lack of time and continuing high risk exposure because they’re not reinvesting regularly in their business.

Dear Brian, this is Peter, we met at the candlelight ministries where Chuck delivered a very motivating talk on business.This is to thank you for the good work that your org is doing in our country and also to assure you that the seminar was not in vain.I have tried to pass on the message to my peers at komarock and we really are trying to change our approach to business so we can register better returns.Please keep in touch and kindly inform us when you next visit.God bless you.Regards-Peter.

In the seminar Chuck Blakeman covered:

• Revenue – Cost = Gross Profit
• Gross Profit – Income = Net Profit

It is a problem that plagues all businesses worldwide: you get a $100 check from a client and think “Yay I have $100!” Not so, as Chuck explained using the metaphor of selling eggs. You have to factor in costs of buying more eggs to sell, transporting the eggs to a market, broken eggs, employees, refrigeration, and so on. Only after those costs, and after taking the income you need to live on, do you have your actual net profit.

It was incredible to watch the light bulbs go on in these social entrepreneurs heads. One attendee said “this changes everything…now we know why our businesses have been failing.”

These brave entrepreneurs are truly my heroes, it is a privilege to serve them and support their work.

P.S. If you have a business and support The 1010 Project you can receive free business coaching from Chuck!

Mama Bidii (Active Women) and the Crafts They Created

The women sang around my wife, Shannon, gave her a green “Mama Bidii” shirt, and wrapped here in their black and white skirt. Then we looked at their truly beautiful handiwork, and bought Christmas gifts for the year!

A truly beautiful experience.

Chips That Changed Her Children’s Lives

A loan of 1000 Kenyan Shillings (ksh), about $15.

She built a 5000 ksh/month business selling chips (french fries), about $75.

This helped her pay school fees for 6 kids, pay the rent, and change the future of her family. This my dear friends, is social entrepreneurship.

Small is the new big.

One resounding lesson from this experience is something built into the DNA of The 1010 Project: it is more important to have the right questions than the right answers.

Exempla Gratis (E.G.)

Over the week I’ve spoken with two Kenyans possessing 30 years of development experience between them. One of the first partners I visited was Pastor Brown and his wife Josephine, founders of Fair Oaks Academy and leaders of Redeemed Gospel Church. I also joined Michael Nyangi of LOMORO in visiting the small businesses started with capital he lent, and discussing the role of The 1010 Project.

I asked them each some form of this question: “How can The 1010 Project improve our partnership with social entrepreneurs in Kenya.” The answers I received were remarkably consistent. Chiefly, that partners have access to business training, and create solid business plans for their ventures.

My former business coach Chuck Blakeman explained this principle to several Nairobian women. Business is like water; you simply need to know where you are and where you are going. Michael Nyangi pointed out that many social entrepreneurs have not received any kind of business training, and some very little education at all. Having access to training and building a business plan first both defines sucess and increases the likelihood of reaching it.

This confirmed and clarified for me my belief that in any culture, three things are needed for the success of a social entrepreneur

• Skill: this could be a private sector skill like jewelry making, or a social sector skill like building an orphanage
• Capital: access to startup funds either from one’s own means, or an outside source; e.g. small grants from The 1010 Project
• Training: acquiring basic competence in fundamental business practices like marketing and accounting

Questions are Primary

As you can see above, the end result was an “answer:” business training being essential to fostering social entrepreneurship. Discovering answers to the challenges of poverty is both noble and essential, but questions must always be primary. In other words, it is impossible to answer a question for someone that has never been asked of them.

Half-Built Houses and the Problems of Credit

The growing Eastlands of Nairobi is dotted with half-built houses. As you walk through the brick/cement/stone structures so typical of the developing world, you will see neighborhoods where perhaps 3 out of every 4 houses is roofless and vacant. The doors and windows will be piled up with loose rocks, to discourage squatting. One of my hosts explained that Nairobians build as they have money. So the building process is lengthy and at times unpredictable.

This was another of those visual reminders of the importance of credit in a healthy economy.

The United States is coming off triggering a massive global recession for the opposite reason: the excess of credit. Multitudes of homeowners were sold mortgages they had no business receiving, without having to prove adequate income.

The density of population here is staggering. And unlike the dense urban centers in the US like New York, there is vastly inadequate infrastructure. That last sentence just doesn’t convey how utterly overburdened Nairobi is, like a bicycle carrying 40 mattresses. Fred Afwai, our Kenyan Country director, explained that the city planning for Nairobi was for 200,000 people. Think Boulder, Colorado. The current population is somewhere close to 5 million. Think the entire population of Colorado.

Bank accounts and loans are only available to those who already have money. To open an account is costly, and simply out of reach of our friends here in the eastern, poorer part of the city. This means that overcrowded population centers in Nairobi will remain crowded while half-built houses remain empty.

The “Problem of Credit” is Simply an “Opportunity”

Charles Owino of YOCHAN (Youth Challenge Network) corrected one of his youth when she spoke of a “problem,” saying it was not a problem but “an opportunity.” I imagine he would similarly advise here. Partners like Mother’s Concern and LOMORO are tackling this “opportunity.” Michael Nyangi is already “The Banker to the Slums,” as one Swiss newspaper called him after he met with a Swiss banking colleague. He has provided savings and loans services through his organization to 210 growing LOMORO so he can become a bank someday.

The good news: The solutions, and the social entrepreneurs who have devised them, are already present here in Nairobi. That is why The 1010 Project is here: connecting these social entrepreneurs with capital. Additionally, as part of this trip we are establishing grassroots business training to help increase their capacity for success.

The 1010 Project continues to grow because the opportunities here are…well, endless. And because our supporters in the United States continue to seize these opportunities for contributing their time, expertise, and resources towards breaking the cycle of poverty for life.

If you haven’t already…will you Join the Story?

You can follow Chuck at http://twitter.com/ChuckBlakeman and Brian in Kenya at http://twitter.com/the1010project.

Discover how you can have your own service learning experience in Kenya with The 1010 Project.

Join the The 1010 Project this summer for one of our incredible service learning opportunities!

Business Focus – (June 8th – 24th)

Come listen, learn, teach, and experience life in the business sector of Kenya, one of the largest economies in East Africa and a dynamic hub of both informal and formal commerce. Your service learning experience will include conversations with entrepreneurs in both cosmopolitan Nairobi and the remote farms of rural Western Kenya, with numerous opportunities to search for creative solutions to pressing challenges. Don’t miss a chance to see firsthand the possibilities and ingenuity in one of Africa’s emerging markets.

Education Focus – (July 6th – 22nd)

In 2002 President Mwai Kibaki made primary education free throughout Kenya. The ensuing surge of enrollment speaks to a strong desire among Kenyans, especially the poor, to pursue an education. Nonetheless, high dropout rates from primary to secondary levels remain a concern. Come listen, learn, teach, and experience the nuances of public and private education in Kenya. You will have ample opportunity to interact with students of different ages and backgrounds and meet remarkable teachers who create opportunities even without material items for curriculums. If you are a teacher, educator, child care worker, or interested in a career in such a field, this is the service learning experience for you!

Cost per person equals approximately $3,500 (inclusive of airfare – subject to change)

If you are interested, please write a short email to development@the1010project.org expressing your interest. We we will then provide you with a service learning application.

Space is limited and the application deadline is Friday, February 19th – SO make your purposeful summer plans now!