Sunday, May 13, 2007

Design for the Other 90%

I had breakfast at International Development Enterprises (IDE) on Thursday, along with three other individuals. IDE currently has a staff of 13 employees in their Colorado office, though about half of them were traveling to various locations on Thursday. The new CEO (Rosalind Copisarow) has not started with the company yet. So Jaime Dufresne, the donor relations coordinator, gave the presentation and answered our questions. She made it clear that IDE seeks for solutions to extreme poverty, or in other words, $1 a day poverty, which affects 1.1 billion people in the world, primarily in Africa and Asia.

IDE's solutions are very low tech, from my perspective. Whereas (my employer) Medtronic's products fascinate me since I'm not convinced I could truly ever understand how they work, I look at IDE's products and think "I'm quite certain I could reverse engineer that." Their treadle pump, shown above and resembling a very cheap stairmaster, harnesses foot power and body weight to help pump ground water to the surface to irrigate crops. And IDE's water filters look like small, clear, plastic garbage cans with a little filter inside. The #1 design characteristic appears to be low cost, rather than high tech. But the low cost is precisely what allows customers to buy the technology. According to an exhibit at the Cooper-Hewitt National Design Museum called Design for the Other 90%, over 1.7 million treadle pumps have been sold. That's pretty amazing to me; it's one thing to say "we've given away 1.7 million pumps," but it's an entirely different thing to say "over 1.7 million treadle pumps have been sold." People clearly gain value from IDE's products.

IDE has a unique "business model." They fund R&D, marketing, and general administrative overhead with donations from both private and institutional donors (more than 2/3 of IDE's support currently comes from institutional donors, meaning they are currently not eligible for inclusion in Charity Navigator's database). Then they give away their technology and manufacturing processes for free to potential suppliers in the developing world, who then produce products and sell them at a profit in local markets. IDE has relationships with a number of microfinance institutions around the world, who help subsistence farmers to pay the original $25-200 startup fees, depending on their country and their specific purchases. It's a sustainable business for the local suppliers and microfinance institutions, since they make a profit. And IDE works to make their programs sustainable overall for the countries in which they work. For example, in Bangladesh, IDE has very little direct involvement today because the treadle pump market flourishes so much without their continued marketing support. In the development world, I imagine one of the best things to hear is "We don't need you anymore, because you've helped us to become self-reliant."

I'm intrigued enough by IDE's model that I've volunteered 25 hours of my time to the organization, which will qualify IDE for a $500 grant from my employee to "match" my time. I still need to work out the details of my volunteer service with IDE.

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