Micro-Franchising Water

Micro-Franchising Water: Jibu is building a global network of safe-water franchises.

Black Forest, United StatesBlack Forest
Organization type: 
hybrid
Project Stage:
Start-Up
Budget: 
$100,000 - $250,000
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

We are building a global network of safe-water franchises. Jibu invests the generous financing, equipment, business know-how, and branding needed to start a 100% locally owned and organically scale-able franchise. Water depots treat and sell affordable water, packaging it in refillable bottles.

About Project

Problem: What problem is this project trying to address?

780 million people do not have access to an improved drinking water source and 80% of diseases in the developing world are water-borne. Development organizations have failed to find a locally owned solution and as many as 50% of safe water projects fail after 2-3 years. Enterprises in the emerging market water sector reach only the wealthiest top 10%. We need a locally owned, locally innovated, and organically scalable solution for the BoP.

Solution: What is the proposed solution? Please be specific!

Jibu is introducing a new application of the franchise business model to the emerging market to propel local innovation in solving the water crisis. We lend the emerged market’s corporate advantage to local, emerging market entrepreneurs by providing advanced water filtration systems, refillable bottles and packaging, point of sale systems, branding, extensive training on all aspects of running / growing a business, and financing to empower mission-driven entrepreneurs to start profitable businesses built to end the water crisis. Water is priced to serve the middle 80% of the market but we provide water credits (funded by donors and carbon credits) and WASH resources to local owners in order to also reach the bottom 10% of the market.
Impact: How does it Work

Example: Walk us through a specific example(s) of how this solution makes a difference; include its primary activities.

Alfred is a Jibu pilot manager of two water depots in Kampala, Uganda. We invested over $25k in water filtration systems, bottles, operating procedures, branding, PoS systems, and training for the entrepreneurs he hired. He invested $500 as a start up fee and more than $1000 in many other start up expenses such as store renovations. Alfred's depots are now being independently operated by young entrepreneurs w/ a stake in his businesses. Drinking water is being sold at 1/4 the market price in refillable bottles in slums, health clinics, and middle class neighborhoods. Aided by revenues generated in first two months of operation, Alfred has already reinvested in business expansion with the purchase of a small delivery vehicle.

Impact: What is the impact of the work to date? Also describe the projected future impact for the coming years.

To date (operational 2 months): - 6 new business owners - 9 additional jobs created - 3 (soon to be 5) densely populated urban communities have access to safe, affordable water Expected 5 years: -6 mil people have better access to reliably safe, sustainable and affordable water source -3,000 new businesses launched, half of which are owned and operated by women -Needs of the poorest in Jibu communities met through the Water Club – Jibu’s water credit program. Water credits account for 10% of all water sales - funded by Jibu donors and carbon credits. -Statistical proof of a significantly lowered rate of waterborne illnesses – especially among children – in all of our service areas -The corporate, regional manager, and franchisee tiers of business have sufficient returns to adequately incentivize maintenance and scaling, hence proving a truly lasting model
Sustainability

Financial Sustainability Plan: What is this solution’s plan to ensure financial sustainability?

Internally, business operates on four sources of revenue: 1. Pay back of debt on equipment (marked up 6%) payable by Franchisee to Regional Manager (RM) to Jibu Corporate. 2. Start-up license investment payable by RM and Franchisee to Jibu Corporate. 3. Monthly royalty payments payable by Franchisee. 4. Water sales profit-sharing between RM and Franchisee All profits from water sales are divided between the RM and franchisee.

Marketplace: Who else is addressing the problem outlined here? How does the proposed project differ from these approaches?

In East Africa's emerging market, private enterprises address the demand for safe water while development organizations address the need. Enterprises are white collar (targeted to top 10% of income bracket only) and extend no opportunity for local ownership. Most development orgs under-price product, do not properly package water to make it aspirational, don't build fully profitable models (that pay back capex and opex), and focus only on bottom 10-20%. Jibu reaches bottom 90% of market w/ an aspirational product & profitable business model that facilitates local ownership and innovation.
Team

Founding Story

Jibu is a father-son business (l3c). My father and I did not join forces because we are naturally “best friends” – we came together because we believe in Jibu. Our partnership is the result of a coincidental convergence of passions. Over the course of my Peace Corps service, I realized that teaching a man to fish is not enough to change a community – fishermen motivated to provide for more than just his/herself are needed. While I was learning this, my father was having the same realization as a businessman consulting for World Vision on their water provision strategy. My father and I have gathered around the idea that "sustainability" is not enough. Solutions need to be locally innovated more rapidly than needs grow.
About You
Organization:
Jibu
About You
First Name

Galen

Last Name

Welsch

About Your Project
Organization Name

Jibu

Organization Country

, CO, Black Forest, El Paso County

Country where this project is creating social impact

, CO, Black Forest

How long has your organization been operating?

Less than a year

The information you provide here will be used to fill in any parts of your profile that have been left blank, such as interests, organization information, and website. No contact information will be made public. Please uncheck here if you do not want this to happen..

Your Solution
Founding Story: Share a story about the “Aha!” moment that led you to get started and/or to see the potential for this to succeed.

Jibu is a father-son business (l3c). My father and I did not join forces because we are naturally “best friends” – we came together because we believe in Jibu. Our partnership is the result of a coincidental convergence of passions. Over the course of my Peace Corps service, I realized that teaching a man to fish is not enough to change a community – fishermen motivated to provide for more than just his/herself are needed. While I was learning this, my father was having the same realization as a businessman consulting for World Vision on their water provision strategy. My father and I have gathered around the idea that "sustainability" is not enough. Solutions need to be locally innovated more rapidly than needs grow.

Select Sector(s): To which of Unilever's categories of sustainability does your solution apply?

Sanitation and Hygiene, Water, Greenhouse Gases, Supply Chain Micro-entrepreneurs.

Measurable Impact
Audience: Who have you identified as your customers/recipients and why? How will you get your solution to them or engage them in your initiative?

Current primary customers are urban, emerging market populations w/o reasonable access to safe water. Jibu provides packaged drinking water that is safer and cheaper than boiled water. It is more efficient to start urban and roll out to rural then vise versa. The secondary beneficiaries are the franchisees and regional managers who will own a profitable social enterprise. A beautiful, quality, delivered-to-door product attracts primary customers; opportunity aggressively attracts secondary.

Impact: What is the impact of the work to date and expected impact in the future?

To date (operational 2 months):
- 6 new business owners
- 9 additional jobs created
- 3 (soon to be 5) densely populated urban communities have access to safe, affordable water

Expected 5 years:
-6 mil people have better access to reliably safe, sustainable and affordable water source
-3,000 new businesses launched, half of which are owned and operated by women
-Needs of the poorest in Jibu communities met through the Water Club – Jibu’s water credit program. Water credits account for 10% of all water sales - funded by Jibu donors and carbon credits.
-Statistical proof of a significantly lowered rate of waterborne illnesses – especially among children – in all of our service areas
-The corporate, regional manager, and franchisee tiers of business have sufficient returns to adequately incentivize maintenance and scaling, hence proving a truly lasting model

Growth, Finance & Leadership
Scaling the Solution: How do you intend to scale your activities over the next two years (e.g., reach new markets, diversify solutions, etc.)? What will make this possible?

We intend to scale across East Africa in the next 2 years. We've already identified partners (regional managers) in Kenya, South Sudan, and Zambia. Our regional managers (RM) identifies franchisees (independent business owners/operators.) Because our RMs are offering the opportunity to own a profitable business with an increasingly recognizable brand, he/she have found aggressive interest / a large pool of local candidates for this position. The prize money will be used to buy a 20 L bottle mold (~20 k) for transparent, easy-to-carry, dispenser bottles (designed pro bono) and the prize leveraged to raise 3-4 million this Spring, 2013 in expansion capital (mostly needed for up-front cost of water filtration systems and bottles.)

Financial Sustainability: What is your business model to ensure financial sustainability?

Internally, business operates on four sources of revenue:
1. Pay back of debt on equipment (marked up 6%) payable by Franchisee to Regional Manager (RM) to Jibu Corporate.

2. Start-up license investment payable by RM and Franchisee to Jibu Corporate.

3. Monthly royalty payments payable by Franchisee.

4. Water sales profit-sharing between RM and Franchisee
All profits from water sales are divided between the RM and franchisee.

Experience: Please provide examples of any previous entrepreneurial initiatives you have pioneered.

- Started successful landscaping and lawn-care business as 16 year old (50+ regular customers; 3 employees)
- Co-developed Peer Education (PeerEd) Health Club based on innovative "train the trainer‟ model & selected by Moroccan Ministry of Health and Peace Corps to facilitate replication of program across country.
- Built first-of-its-kind, locally maintained city park (USAID grant recipient) in center of Errich, MAR