Israeli Hackers with a Conscience - by Caylee Talpert

Tel Aviv hackathon aims to show that technology can help the world's poorest people - and make a profit.

(This Op-ed was published in the Haaretz on November 14th: http://www.haaretz.com/opinion/.premium-1.557942)

When you look at a satellite map of the world at night, you are struck by the vast contrast between the “developed world” with its brightly light skyscrapers and “the rest”, the developing world that largely remains in darkness. There, people live without access to energy to light up their homes, warm themselves in winter or cook for their families. The astute businessman would recognise that such a disparity must represent an opportunity, a vast undeserved market with limitless growth potential.

Increasingly, forward thinking businessmen and multinational companies are doing just that and beginning to notice that perhaps as the late business thinker C.K. Prahalad predicted there may be a “fortune to be made at the Bottom of the Pyramid” (BoP), the term that has come to refer to the economic segment of the world’s poorest people. These people - who live on less than $2.5 a day - comprise nearly half the world’s 7.1 billion people, a market estimated at having a purchasing power parity of over $5 trillion.

But even once a potentially huge market of consumers has been identified, it doesn't necessarily flow that businesses schooled in developed world markets can simply replicate their products and strategies in a very different environment. There's no “business as usual” in this field: Indeed, unmet needs can’t automatically be equated with ‘demand’ in the way the developed world sees it. Serving these markets means that innovative business models as well as technologies are often a pre-requisite for success.

How do you manage distribution channels that are based on thousands of micro-entrepreneurs to reach “last mile” villages in rural areas? How do you convince communities that have been drinking from the same well for generations that if they were to buy water purifiers their children would no longer suffer from diarrhoea? How do you partner with NGOs or use micro-financing to increase the affordability of your products?

Last month’s BoP Summit at Michigan University brought together 200 business leaders, academics, impact investors, social entrepreneurs and international development practitioners to discuss what has worked and what hasn't when building scalable and sustainable developing world businesses and how to use this experience for the next decade.

Now it's Tel Aviv's turn to turn its technological talents to the developing world. 150 developers, business and international development professionals will be coming together today and tomorrow to 'Develop apps for the developing world' at the Dev4Dev Cleanweb Hackathon.

The hackathon, organised by the IsraelDev Network (a grassroots movement of young entrepreneurs dedicated to the developing world, supported by the Pears Program for Innovation and International Development) and Terralab Ventures. Terralab Ventures aims to expose Israel’s business and technological community to the opportunities both to make profit and create social impact in the developing world. The challenge for the teams of Israeli hackers will be to find ways to produce low margin, high volume technologies – the exact opposite of the aims of most Israeli innovations.

On the developer side, this 'frugal innovation' means learning to innovate without all the gizmos and gadgets that the latest iPhone 5 provides. The hackathon will kick-off with a workshop on innovation for feature phones, the basic version of smartphones, which comprise around 70 percent of mobile phones sold worldwide and are the primary source of connectivity for the majority of the developing world. On the business side teams will have to think of business models that make their products accessible and desirable to people with low individual/personal spending power.

More than 25 specific challenges for the Hackathon have been submitted from Africa, Asia And Latin America, from applications that provide advice on basic nutrition, disease or family planning (submitted by fieldworkers in Tanzania and Malawi) to a simple translation device for fairtrade growers in India.

The teams working on these challenges are made up of experienced “techies”, business development and seasoned international development professionals. Already we have seen a merger between the “Start-Up Farm” team, looking to create out-of-the-box farm kits for small-holder farmers that will be paid for in instalments through cell phones, with the “Aquaponics App team”, a team of developers working on an app to teach farmers how to use waste produced by fish to grow agricultural produce. Another team will be flying in all the way from Ghana and will be working on a patient drug and monitoring application while also learning more about the Israeli entrepreneurial eco-system during their visit.

While these initiatives may be new to Israelis, innovating for Bottom of the Pyramid markets is something that is growing steadily elsewhere in the western world, where companies such as General Electric, Procter and Gamble, Google and IBM recognize that demographics and growth rates mean they have to grapple with these markets' needs. Leading aid agencies have also began to recognise that market- based solutions offer the best opportunity for achieving sustainable impact and scale.

As the overwhelming positive response to this hackathon has demonstrated, the BoP buzz is starting to spread in Israel.

Israel's technology sector and recognised expertise in the fields of water, renewable energy, health and agricultural technologies is well suited for working at the Base of the Pyramid. These new markets could offer Israeli start-ups and companies immense opportunities if they can adapt to the appropriate technologies for these markets and if they can develop the new business models necessary to successfully serve poor customers in these countries.

Slowly we are working to build the infrastructure in Israel that supports and promotes Israeli businesses working at the BoP in developing countries. Hopefully, when the time comes to host the next decade’s Global BoP Summit, successful Israeli entrepreneurs will proudly occupy a healthy share of the seats on the stage.

Caylee Talpert works at the Pears Innovation and International Development Program at Tel Aviv University. She recently returned from the BoP Summit in Michigan and is one of the co-organisers for the Dev4DevCleanweb Hackathon which is being held at the Google Tel Aviv Campus.

The Pears Innovation for Development Challenge based at the Hartog School of Government and Policy at Tel Aviv University will be launched in March 2014 to provide mentoring and support to ventures focussing on the developing world.

Getting your Water Technology from Here to There - by Ornit Avidar

You can conceptualize a water product or technology and be firmly confident that this is the most efficient and advanced solution . However, this is an insufficient (and sometimes not even needed) condition to get it to the millions/billions in Africa and the bottom of the pyramid ("BOP").

  To sell your products to the BOP, you need to:

1)    Cater to the BoP's specific needs

2)    Form an Innovative package

3)    Get financing

4)    Adopt the right attitude

BoP specific needs: As always, you first need to decide who the target end-user is, what they need and what is available locally to make this feasible.

Of course, clean and easily accessible water is a primary basic need but usually the existing infrastructure in developing regions does not allow for the utilization of technology often used in the West. Thus, appropriate technology needed often needs to be:

●      simple

●      decentralized

●      low maintenance

●      low energy - where there is no water, there is usually no electricity

●      low cost

You want real solutions instead of money-wasting white elephants.

Innovative packaging and models:

The right packaging incorporates many options:

●      Firstly, you need to enable a different price range. If one is to keep the quality, this means no frills; many of the components essential for the West are not needed and even wasteful in Africa, smaller packaging and smaller quantity are key.

●      Add social mechanisms and business models. Over 50% of water projects in Africa are not sustainable after 6 months^[1]. This is seen all over Africa in the form of malfunctioning equipment, lack of maintenance, faulty or soiled filters or just plain population misuse due to lack of training and understanding. This can be solved if you add social mechanisms and business models to your technology package.

●      Training programs and a maintenance package are also essential as without these the project is short-lived.

●      Turn-key solutions: BoP style projects, with an operation base from which Return on Investment can be generated, is always a very sought after model by many governments and agencies in Africa.

Financing:

We need to keep in mind that the reality in Africa is that government budgets cannot cover all the costs thus requiring alternative methods of financing projects

The right attitude:

●      Be creative and open to new ideas and sales techniques.

●      Be optimistic and know that businesses can have a positive impact on people's lives.

●      Partnerships with local partners and distributors are essential; you must have a local presence and be able to communicate with local culture.

Africans looking for Israeli technology and expertise should know certain facts about Israelis:

●      Israelis are very pragmatic and often do what they can with what is available; that is one of the main advantages of working with Israelis.

●      Israelis have a history of dealing with drought and lack of water, which has made them experts in this field.

●      Israelis are very curious people – they often go to great lengths and to almost anywhere in the world just to see it, meaning they are very happy to travel wide and far.

●      Lastly, Israelis tend to believe that there is nothing that can't be overcome.

---

^[1] Founder of EWB, Professor Bernard Amadei, University of Colorado, USA – EWB seminar Tel-Aviv, 3 June 2012 http://www.youtube.com/watch?v=o-hE_KgLhTo

^[1]

Israeli remedies for India’s food security problem

Every year after Rosh Hashanah (the Jewish New Year) when I visit India, my home country, the first drastic change I notice is the food inflation rate. In New Delhi if you send an SMS to a restaurant for home delivery service, you may get your order in less than 20 minutes, which goes to show that there are plenty of food options available. At the same time, however, you will notice the numerous beggars on the streets. There is thus something visibly wrong that led me to ask myself whether it is possible for us to directly connect the agriculture field to people in need?

There is a fundamental rule in business management: If you want your business to profit then you should do something essential for all human beings. Yet why is it that the IT sector is so thriving while food farming, an elemental need in life, is not profitable and that in last 15 years over 200,000 farmers have committed suicide in India?

Agriculture scientists worldwide emphasize the fact that at the current growth rate, the world population may reach 9 billion by 2050 and that to meet the increase in demand we must elevate production levels. However, current statistics show that while today’s world population amounts to 6.7 billion, we produce enough food for 11.5 billion people, almost double than required. The main reasons for such a lurid problem has to do with problematic trade and economic policies. As a result, farmers are committing suicide, much of the public is suffering from food inflation rates and the majority of profits are taken by middle-men. What we need then is just a proper food chain supply and that constitutes a huge business opportunity for Israeli agritech companies.

To overcome these problems the Indian government is planning to bring a food security bill for poor people, as well as FDI (Foreign Direct Investment) to improve the food chain supply for the common man before next year’s election. There are big debates taking place about the implementation of such a critical bill in this time frame.

Although a national food security bill provides food to poor people on subsidized rates after having bumper crops yields, no one knows what economic, political and social impact it will have. For example, instead of bringing down food prices, this seems to have had the opposite effect. The bill has been criticized for low food entitlements and inadequate attention to nutrition. Moreover, if a small farmer could get food grain for as little as Rs.1 per kg, as proposed in the Food Security Bill, what incentive would s/he have to grow her/his own? And what would happen in a bad crop year or successive bad years? Currently, production and availability of food grain for implementing the Food Security Bill does not appear to be an issue since on average one third of the food grain production every year is wasted due to lack of proper storage facility. We have had bumper crops every year — 259.32 million tons in 2012-13 — and have enormous buffer stocks. Ever since Brazil launched the Zero Hunger Programme in 2001, it has pulled out 30-40 million people from poverty. Brazil promises to eradicate hunger by 2015 whereas in the Indian National Food Security Bill there is no such specific goal being doled out.  To me, it seems that while Brazil's Zero Hunger was time-bound and aimed at making hunger history, India's Food Security Bill is simply targeted at the 2014 elections.

At the same time FDI is going to open doors for US firms like Wal-Mart and Tesco. The government justification is that this will improve food chain supply, provide warehouse and especially cold storage facilities, thus having control over food inflation rates and giving the public the choice to buy from cheaper outlets. But at the same time, an influx of foreign actors would have a strong impact on unemployed people who work in small businesses for their daily survival and have no job security. Farmers, in addition, would not have the right to demand minimum support price (MSP) since these companies may buy goods from other countries and then sell them in India. Even though the government claims that it has placed safety nets in place, e.g. outlets would be open only in those cities where the population is over 1 million (currently 53 cities) and foreign firms would have to buy at least 30% of their products from the Indian market, these rules have yet to be accepted by the foreign companies with which the government is in negotiation.

In such circumstances start-up countries like Israel have much to offer India. To quote former UN Secretary General Kofi Annan, “In an age where community involvement and partnership with civil society are increasingly being recognized as indispensable, there is clearly a growing potential for cooperative development and renewal worldwide”. India should thus consider adopting Kibbutz-like agriculture practice to minimize transportation and storage problem, which will then lead to further price control by removing the involevement of middlemen.

Land is a productive asset, but for many farmers who lack scientific agricultural practice, it is in the hands of unproductive people. Moreover, water and agriculture are inextricable. Thus , it is important to know how to exploit water for irrigation with minimal effort. Presently in India most farmers use underground water for irrigation and depend on diesel or electricity to pump it, which brings financial burden to poor farmers. In this context, there are many agricultural tools and methods that Israel can share with India, whilst at the same time getting access to Indian biodiversity – 45,000 plant species which can bring even further improved plant varieties through molecular breeding practices.

With the changing global climate, post-harvest damage has become very challenging throughout the world. During the rainy season (Monsoon) in India the price of vegetables like tomatoes and onions is very high. Bringing in options such as processed tomato purees and onion paste could present solutions in such cases. Here we should not forget that Israel exports vegetable products to the whole of Europe with minimal post harvest damage.

Several other small innovative applications like grain cocoon, biological pest control, and protected cultivation under greenhouses could also be very useful to solve India’s food security problem. Furthermore, dairy and fish farms, which stem off the agricultural branch may also benefit from Israel’s significant technological expertise.

Dr. Akhilesh Kumar is a Postdoctorate Fellow at The Volcani Center (Ministry of Agriculture and Research Organization) and a Fellow of the Israel Asia Center