Problem | Opportunity | Solution
Problem: 10% of the world's population, or 1/3rd of the base of pyramid, is too poor to buy even the lowest cost solar product, yet spends 15 times more on inefficient alternatives simply because they fit cash-on-hand.
Opportunity: For families living off $1 to $4 a day, energy approaches 30% of household expenditures and families develop two behaviors in response that make Stima's approach a natural and symbiotic fit: energy is managed daily and families band together with community members to smooth cash flow so they can cover daily expenses in the absence of consistent daily income. As the saying goes, individually they are bust, but together they are strong.
This target segment has proven itself to embrace the methodologies that Stima uses. In fact, Stima adopted the methodologies from customer feedback. In pilots leading up to Stima, the founders also discovered that those earning below $1 a day burn firewood and don't budget daily for energy and at incomes above $5 a day, energy drops to 10% of income and families rely less on communities to smooth cash flow. These users drop out of group meetings over time as they not take recruitment of fellow customers as seriously.
Solution: Stima's solution is 4-fold;
1. Low-cost portable solar chargers and lights with Stima's patent-pending payment control technology inside
2. Pricing model that fits cash-on hand
3. Group guarantee methods honed over 3 years in Kenyan pilots to ensure payment
4. Franchised distribution; leveraging local entrepreneurs to reach deep into the village
Stima embeds a patent-pending control chip into a portable solar charger so it shuts off every week unless payment is received over a mobile phone. This allows Stima to turn any solar charger into an affordable pay-per-use service that fits cash-on-hand and eliminate all upfront fees that create barriers to adoption.
Stima recognizes value and technology alone are not enough to operate a sustainable business when serving a target segment that has unreliable income. To ensure collection, Stima leverages proven group financing practices, common in our target segment, which requires users to co-guarantee payments. With Stima, interested users recruit 10-20 additional users whom they trust, form a group and agree to co-guarantee full payment. If one person does not pay, no one is reactivated, forcing the group of users to self-enforce payments. Over time, Stima solidarity groups become stronger and leverage their combined finances to invest in other opportunities.
Finally, to cost-effectively reach deep into rural villages, Stima distributes chargers under a franchise model; leveraging rural entrepreneurs to oversee recruitment and payments by groups. These "Agents" manage upwards of a hundred users with a "Money Key" that ensures payment collection or service expires. Portability and simplicity are important; an Agent carries 50 chargers into a remote village on the back of a bicycle and first-time users figure out how to charge phones and turn on lights within the first sunny day. Just like the controlled chargers, the Money Keys also expire ensuring controls throughout the channel.
Stima combines affordable pay-per-use energy with control technology, proven methodology, targeted income groups, and well-connected local entrepreneurs to ensure reliable collection, viral growth, measurable impact, and fair profits for STIMA and channel alike.
For more information please contact us.
STIMA Product Portfolio