Innovations in Scaling

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By Chris West, Director, Shell Foundation. Presented at Transforming T

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Innovations in Scaling

  1. 1. Innovations in ScalingJanuary 2011CHRIS WEST
  2. 2. SF Mission and Approach SF is an independent charity that catalyses scalable & sustainable enterprise-based solutions to global development challenges. We work with a We deploy We leverage our few strategic partners more than money to independent but linked on a core set of issues pilot, scale-up and relationship with Shell replicate solutions where appropriateGovernance Mixed Board of TrusteesFunding US$20m/yr (and US$400m endowment)Principles SF Business Principles
  3. 3. Being Catalytic for Scale Systemic/market failures underpin global sustainable development challenges: New “pull” products/services require Market Entry eg micro-credit, clean cookstoves New “push” products/services require Market Creation eg SME finance, sustainable transport solutions Few existing institutions are fit for global scale-up Need for catalytic or disruptive change....
  4. 4. Vision for Scale New intermediaries with innovative products/services Vision from outset to achieve scale Led by “social entrepreneurs”- business-like approach SF co-created/co-founded various intermediaries: Embarq - sustainable transport (2002) GroFin - specialist SME financier (2002) Envirofit - clean cookstoves (2006) CottonConnect – ethical trade (2008) Global Alliance for Clean Cookstoves (2010)
  5. 5. Building for Scale Unrestricted core funding – build capacity/systems Business skills support/mentoring Market linkages, enabling environment Working in close partnership – more than money Angel investing – accept high level of start-up risk
  6. 6. Financial viability for Scale Plan to exit subsidy dependency Measure and track performance Financial management and planning Drive for cost efficient structures/processes Focus on quality Seek earned income streams Early adopters not necessarily the most poor
  7. 7. Patience for Scale Takes a long time, fragile and not low cost - for private sector as well as social enterprise Patience, persistence, adaption, flexibility Pricing, marketing, awareness, distribution Focus on early success Continual market/customer feedback Long-term support: smart subsidy + more than money Build a brand Social marketing required before reach “tipping point”
  8. 8. Some Ideas for further Scale Create more business-like intermediaries… - eg create viable pipeline of finance-ready projects Capture and trade social value - eg carbon pre-finance; social investment bonds Create specialised blended social capital funds Transport and IT linkages - better informed individuals Policy reform – eg fuel standards

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