Pollinate Energy



Website: http://www.pollinateenergy.org/ 

Pollinate LogoFranchise Background

Pollinate Energy  brings highly affordable, quality products such as cook stoves, solar lamps, fans, and water filters to the urban slums of India through a micro-franchise model. Pollinate uses door-to-door salespeople, or “Pollinators” to increase access to needed products, knowledge, social justice, and financial opportunity. Products are intended to drastically improve the lives of the poorest people in India, and are offered at radically affordable prices and with available short-term repayment plans. Pollinators benefit from intensive training and support, gain transferrable skills, and achieve financial independence with opportunities to advance within the organization. Learn more...

Protégés Background

Image of MadhaviMadhavi Kulkarni, Head, People and Culture
Bangalore, India

Contact: madhavi.k@pollinateenergy.org

Madhavi Kulkarni studied a Bachelor of Science with a major in Computer Science, but quickly pivoted to Human Resources through her first job out of college. Over her career of 7+ years, Madhavi has worked in Accenture, a US based communications firm Brocade, a health startup Pixel, and now social enterprise Pollinate Energy. Throughout her career she has held various roles across the HR portfolio ranging from staff development, engagement, training, recruitment and importantly – making people happy. Her background in computer sciences has led her to develop a uniquely analytical approach to improving employee satisfaction in an organization, and she prides herself on proving, through data, that her initiatives have great impact across teams.

Madhavi has always been intrigued by culture in the workplace, and is passionate about improving culture, systems and operations to ensure that her employees are motivated and excited by their work. She believes that employees are the backbone of an organization. The happier they are, the better they perform, and the more impact the organization can have. Her role at Pollinate Energy empowers her to do this, to the end goal of delivering more life-changing products (like solar lanterns) to families living in poverty across India.

In Madhavi’s current role, she has also been tasked with helping Pollinate scale its operation through further franchising across India. With this project comes the ultimate challenge – ensuring that an organization of 50 can grow efficiently to an organization of 200 and more. Madhavi is thrilled to be a part of the UNH franchising program, to learn how best to scale Pollinate’s impact through its people as it grows.


Image of AllexieAlexie Seller, Chief Executive Officer, Cofounder

Contact: alexie.s@pollinateenergy.org

Alexie has a degree in Mechanical Engineering and Arts with a long-held interest in sustainable energy solutions. She spent the early years of her career working as a nuclear design engineer with ANSTO and with AGL, Australia’s largest portfolio owner of renewable energy. Throughout her studies and professional life, Alexie has also held multiple local and international community development roles, culminating in a position as Energy Hub Coordinator for Engineers Without Borders in 2012. This sparked her passion for improving energy access in the developing world. She is now based in Bangalore, India with Pollinate Energy where she continues to pursue this passion and is developing a slight addiction to South Indian dosas.

Mentor Background

Image of PeterPeter D. Holt, CEO, The Joint

Peter D. Holt has been active in the franchise community managing franchise systems in both domestic and international markets for over 30 years.  Most recently was appointed Chief Executive Officer of The Joint, www.thejoint.com, the largest franchised network of Chiropractic clinics in the world with over 350 clinics system wide.  The Joint is a publicly traded company on NASDAQ (JYNT) based in Scottsdale, AZ.

Previously, he was President and Chief Executive Officer for Tasti D-Lite, LLC a Brentwood, Tennessee based company.  While at Tasti D Lite he transformed the NYC, based licensed outlets into a complete business format franchise system.  Additionally, he led the acquisition of Planet Smoothie by Tasti D Lite in 2011 and its integration into the Tasti D Lite business. In June 2015, the company was acquired by Kahala Brands.

Mr. Holt worked seven years for Mail Boxes Etc., the last three years as Executive Vice President, Franchise Sales and Development.  MBE (now The UPS Store) is the world’s largest franchisor of retail centers specializing in shipping, business and communications services.  During his tenure, the franchise system grew to over 4,000 retail locations, including some 1,300 MBE stores operating in 34 countries. 

From 1990 to 1996, Mr. Holt was Vice President of International for I Can’t Believe It’s Yogurt and Java Coast Fine Coffees, affiliates of The Brice Group.  Headquartered in Dallas, ICBIY was a franchise system of over 1,000 frozen yogurt outlets operating in 35 countries.

Mr. Holt began his career in franchising at the International Franchise Association, the oldest and largest trade association in the world serving the interests of businesses that franchise.

Mr. Holt earned a Master of Arts degree from the University of London, and completed his Bachelor of Arts degree at the University of Washington, where he graduated cum laude.  He has written and lectured extensively on the subject of franchising.  He currently serves on the Board of Directors of PASMO, the Guatemalan affiliate of the Washington DC based NGO, PSI, which provides health care services in developing nations through franchising.  He served on the IFA Board of Directors from 2013 to 2015 and as Chairman of the International Affairs Network (IAN) of the IFA from 1998 to 2007.  Additionally, he served as Chairman of the Global Marketing Group (GLOMAK) which advises IFA on all its international franchise activities from 1998 to 2007. Peter serves on the Advisory Board of the Social Sector Franchise Initiative, a project of the Center for Social Innovation and Enterprise at the University of New Hampshire.

Action Plan Development

On Day 2 of the 2017 Social Sector Franchise Innovations Roundtables, conference participants broke into groups and began the Dynamic Accelerator Solutions Prototyping process, working with each protégé entrepreneur to develop concrete action plans. The action plans include specific recommendations for how each critical issue could be addressed, short-term and longer-term actions the franchisers will take, and the specific ways the mentor will provide technical assistance and support to the protégé. Below you will find Polinate’s critical issues and the action plan. This is the product of our solutions prototyping process; and the framework that we’ve developed for our mentoring process over the next six months.

Top Strategic Issues (detailed below):

  1. How do we maintain and enhance our competitive advantage?
  2. What is the appropriate organizing structure for scale?
  3. (How) should we adapt the model beyond urban markets?

1. How do we maintain and enhance our competitive advantage?
Problem/Opportunity Statement & Background

  • Madhavi identified several aspects of a changing landscape:
    • Electrification of urban slums – would take away Pollinate’s market
    • Subsidized distribution of solar lanterns by Indian government
    • Competing models fundraising in Pollinate’s markets
      • Greenlight Planet sells to a number of distributors; Pollinate is just the 5th largest seller of Greenlight Planet products in their market. 
  • While each of these are significant, we decided to focus on maintaining and enhancing competitive advantage as a topic Pollinate has more control over (since it can make its business model more efficient to compete on price, quality, number of products, proximity to sales team, etc.) and where Peter has unique expertise. 
    • Note that sometimes social entrepreneurs become ‘policy entrepreneurs’, working with partners to shape public policy.  Ian noted that changes in the government arena are a common threat in international business and in development, so there are probably standard approaches that Pollinate could consider.
    • Consider also that Pollinate’s mission may be to ‘put itself out of business’ by eliminating a social need – so widespread electrification could be viewed as an opportunity to redirect Pollinate’s resources to other needs rather than a threat of competition.
  • Competitive advantages (detailed below)
    • Pollinators – a powerful intermediary with similar background and shared experiences who build ongoing relationships with customers.
    • Installment plan provides quick access to products.  The ‘collection army’ of Pollinators (whose commission is linked to full payment) leads to low default rates
    • Customer Sales Management software
    • Worker Bees develop referrals and ensure Pollinators’ safety
    • “Basket” of products allows cross-selling and provides lifetime value for customers.
    • Market niche: urban slums.  Steve observed that Pollinate’s competitors are primarily financial institutions and/or organizations with shops; no one is serving the urban slums.
    • Pay-as-you-go technology (coming soon!)
  • The Roundtable conversation on Pollinate’s competitive advantages was an opportunity to educate the table on Pollinate’s current staff structure, financing options and collection process, and product mix – detailed below for future reference.
    • Current staffing structure
      • Corporate staff – including fundraisers in Australia
      • Sales Manager – one for each of five cities (Bangalore, Kolkata, Hyderabad, Lucknow, and Kanpur)
        • Manages Pollinators
          • 10-12 Pollinators at mature locations / major metro; fewer in start-up locations
          • Leads weekly meeting with all Pollinators, asking questions such as:  How many transactions / open sales? (verbal confirmation with software)  How many are you expecting to close that week?  What collections are overdue/ outstanding and what do you expect to close that week?  Are there collection cases in which the Sales Manager needs to be involved?
        • Identify new locations/communities on a monthly basis.
        • Ought to anticipate needed products (e.g., weather/seasons)
          • E.g., Water filters didn’t sell in Bangalore, but did sell in the 2nd market they tried.
        • Until now, Sales Managers have been distracted by training and put a lot of time training new Pollinators, so weren’t able to concentrate on collecting revenue from existing Pollinators.  Going forward, Pollinate is removing the training function from Sales Managers’ roles; separate trainers will go into communities. 
        • Pollinate is in the process of implementing revenue sharing with Sales Managers.
      • Pollinators
        • 5 tiers: Trainee (3 months), Cadet (3 months, slightly higher target), Junior, Senior, Executive (has charge of 2 juniors + 1 cadet – an exercise in management)
        • Each Pollinator has 3-5 communities, with 1-2 Worker Bees per community (depending on size). 
        • Pollinators tend to be ‘one step higher’ on the economic ladder than customers – can still relate.
        • Responsibilities
          • Identifies leads and makes sales.  Pollinators go right to the doorstep, are incentivized to collect, and stay in touch after product is sold.  We get calls three years later asking for a specific Pollinator.
          • Collects payments from customers. A Pollinator’s commission is linked to full payment from customer, so they are incentivized to collect.  The Sales Managers (‘big boss’) will intervene if needed.
          • Builds relationships to cultivate repeat customers – higher quality or additional products (e.g., from lights to cook stoves).   Through this relationship, “there’s a service related to the product.” 
          • Tries to covert customers into Worker Bees (below).  Pollinate tries to identify Worker Bees every time we enter a new community.  Ian: what is the capacity of Pollinators to maintain all of these relationships?
        • Pollinate is in the process of administering a questionnaire to ask Pollinators what they want for themselves professionally.  Currently, they are essentially commissioned salespeople.  Madhavi says most want to become employees (Indian Mindset) with fixed salary, stability, benefits.  An impediment to a stronger ownership mindset?
        • Recruitment: Pollinate puts up ads – or, if a client is interested, they may work with their existing Pollinator to set up an interview with the Sales Manager.  English not required.  The biggest recruitment challenge is their interest/willingness to work in slums.
      • Worker Bees
        • Worker bees tend to be respected and well-connected, i.e., elderly and/or moneylenders. 
        • They receive no compensation but get freebies and trial pieces (e.g., they will host an expensive new product, that prospective clients come to try at their home).
        •  Take care of the safety of female Pollinators, especially at night.  A Pollinator may come to the Worker Bee’s house to meet their clients.
    • Financing options and collection process
      • Installment plans make products more affordable.  (In India, employees are paid monthly, not weekly.)  Customers pay interest on financing.
      • The ‘collection army’ of Pollinators leads to low default rates.  Customers on a 3-week payment plan are better payers than those on 5- or 12-week plans. 
      • Pollinate is in the process of experimenting with Greenlight Planet’s pay-as-you-go chip that will turn off the product (light, stove, etc.) automatically if daily payment has not been rendered.  A token enables the product to work each day.
    • Customer Sales Management software
      • Currently use Salesforce, with mobile data entry. 
        • Software notes 0.2 points (20% of a sale) to a Pollinator when the transaction is first logged.  It logs 0.8 points when full payment has been made, at which point the Pollinator receives their commission.
        • Doesn’t track customer profiles, so it’s hard to know what the family’s next need is (cross-selling).
      • Pollinate is planning to transition entirely to Angaza, Greenlight Planet’s pay-as-you-go consumer platform. 
      • Mobile banking is not well-utilized in India.
    • Product mix
      • Currently four models of solar lights, water filters, cook stoves, mixer/grinder, and mobile phones.  Considering expansion to herbal oils and other in-demand products.
      • How do you avoid mission drift?  What is the optimal basket? To create a product mix strategically, Fiona suggests connecting with Greg Van Kirk, who has thought deeply about the optimal basket for his organization’s micro-entrepreneurs in Guatemala and Ecuador, including loss leaders as gateway products; Fiona would be happy to make an introduction. 
      • As comparison: In his wedding industry franchise, Ian focuses on just four products.  Franchisees are encouraged to lead with the DJ service, which most customers want, then to encourage higher-margin videography and photography services.

Action Steps

  1. Implement pay-as-you-go model/technology, to augment competitive advantage.
  2. Clarify appropriate financial model given Pollinate’s mission.  Continue to rely on subsidy? Move towards cost recovery? 

2. What is the appropriate organizing structure for scale?

Problem/Opportunity Statements & Background

  • Bangalore market has performed well, but other four cities have struggled.  Why?
    • When Pollinate expanded, they thought the customer base would be the same, but it wasn’t.  Earning capacity was different, different weather – different market conditions.  However, Peter noted that oversight and training and leadership differences can often be just as, or more, significant in explaining performance discrepancies between sites.
    • The Bangalore Sales Manager had prior experience.  For example, he knew how to use the budget to enthuse the Pollinators as appropriate.  Others didn’t have those skills.
      • Use that one great leader to train the others?
      • Develop profile of that person.
  • Similarly: in Bangalore, Pollinators are independent – but everywhere else, they rely on the Sales Manager in order to close sales.  How can we develop the entrepreneurial culture?  And/or, since it is rare to change a person’s ‘Character, Competency, and Chemistry,’ should some staff be replaced?
    • Procedures are the same across locations because they use the same tools.
  • Pollinate’s mission is to serve the poorest of the poor in the slums in India, where nobody else operates.  It also aspires to scale: its goal is to reach 1 million families (currently 1 million customers).  However, its operating model is not financially sustainable without donor funding, since it sells most products at less than the cost of purchase and absorbs distribution costs.  How important is cost recovery to our business?
    • E.g., Pollinate buys a Greenlight Planet light for $29 and sells it for $27.  (In contrast, Greenlight Planet recommends selling price of $40.) 
      • In other cases, market demand allows Pollinate to price products to generate small margins.  Currently, they are determining pricing intuitively based on markets, but nothing systematic.
      • Is this donor-driven model scalable?  Since you lose money on every transaction, scale may crush you!  
    • In a sense, this is a philosophical question.  ‘Who are we and who do we want to serve?’  Pollinate is deeply wedded to population that lives in the slums.  The further down the pyramid you serve, the more you will rely on subsidies (government or philanthropic). 
    • Leadership team should have a strategic conversation on what financial sustainability goals are appropriate given your mission.  Do you want to increase cost recovery (e.g., 10 or 20%). Reliance on subsidy? Move towards cost recovery? Go beyond cost recovery?
    • Madhavi said the goal is to have enough money to put back in the market – gives us extra corpus, deeper penetration, new markets.  Perhaps explore Corporate Social Responsibility-motivated revenue in India?
  • There are various approaches to becoming more financially sustainable, including:
    • Increase donor base. 
      • Donations in Australia have been increasing.  Donors are motivated knowing their funds will go directly to BoP in urban slums (area of greatest impact). 
      • Some donors are asking for sustainability, while others want to know their money is going into the community rather than to corporate overhead and appreciate the zero/negative margin on sales.
      • If your mission changes, your donor base will change.
    • Charge higher price
    • Change payment plan
      • Pay-as-you-go would solve Pollinate’s need to lower a product’s price in order for it to move.
    • Decrease transaction costs
    • Change product mix (loss leader with higher margin products)
    • Change geographic/market mix
      • Sell to upstream market, in order to cross-subsidize?  Challenge is that middle class homes have no need for products and it would require a parallel sales force with potential conflict with existing Pollinators.
  • Pollinator is currently trying to identify multiple models for distribution, from which it can select the most appropriate (considering communities, products, channels used, Pollinator capabilities).
  • What is the right structural model for Pollinators and Sales Managers? (a) Salary; (2) Commission; (3) Move to full or adapted franchise model?
    • If there’s a Pollinator who pays to be a Pollinator, this gives you an income stream and gives them greater motivation.  However, the franchise model is about leveraging capital.  This might not work at or close towards the base of the pyramid.
    • Examples of adapted franchise model:
      • Global Partners in Hope (Ian) has an adapted franchise model.  Because start-up capital is a challenge, donors (not the franchisee) pay for building the health center.  This in turn catalyzes revenue.  E.g., it costs $60k to build a center and first-year revenue is $100k.  Donors like this model because they know won’t come back to ask for more money for the same clinic.  A private Malian group owns and operates each center.
      • Earned equity model (Chic-fil-A) – manager becomes a full franchisee over time (e.g., 20% per year)
      • Royalty – I make my money on my product.
      • There is a lot of variation in adapting the traditional franchise model!  The common element is vested interest of franchisee = local vested interest.
  • (From a later conversation: Pollinate’s CEO and last remaining cofounder, Alexie Sellers, may change role and responsibilities after a planned merger with two? other social franchise organizations.  We did not talk about this merger or leadership transition at the Roundtable but it merits attention in mentoring calls.)

Action Steps

  1. Answer the question: what differences do (a) ‘market conditions’ and (b) ‘oversight and training’ / ‘leadership’ make in determining differences in performance across cities?
  2. Develop the profile of an effective city leader (Bangalore).
  3. Address: What is the right model for Pollinators and Sales Managers – (a) Salary; (b) Commission; (c) Move to full or adapted franchise model?

3. (How) should we adapt the model beyond urban markets?
Problem/Opportunity Statements & Background

  • Pollinate is considering new peri-urban and rural markets.  However, these may require different products and operating structures. 
    • E.g., in smaller markets, it may be more difficult to identify Pollinators in each town.

Key question: Are you sure you have penetrated slums?  It’s more cost-efficient to deepen penetration than to expand to new market.

  • Madhavi noted Pollinate has achieved 90% of coverage in Bangalore.  In all five of Pollinate’s locations, the communities identified are spread over entire border of city.  However - must distinguish between coverage and penetration.  Consider how to maximize Pollinate’s current customer base.

Action Steps

  1. Consider potential for deeper penetration in existing or similar (urban slum) markets.