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Social Entrepreneurship Mysteries: Solving Affordable Eyecare

Introduction to the Social Entrepreneurship Mysteries (SEM): SEM is a chance for you to test your skills at solving a real-world social entrepreneurship mystery. It was designed for those who have taken the Trico Foundation’s social entrepreneurship training, but anyone can try.

Why bother trying to figure out a social enterprise problem that you may have nothing to do with?   

  • You may not be working in the area of the mystery, but we find that it’s a useful exercise to test your thinking on these issues (and, where applicable, our tools). Problem-solving practice makes perfect.
  • Sometimes it’s just good to remove yourself from your own particular situation, where you have your own biases that can cloud your problem-solving abilities, and look at another situation. Sometimes it’s easier to find the challenges and opportunities in someone else’s problems as opposed to your own. In turn, developing those skills regarding others may help you apply those new-found skills to your own situation.
  • Who knows, the solution may inspire you on your own social enterprise journey.

At the beginning of each SEM (and possibly throughout) you will get the facts around the challenge and then be encouraged to think through how you would solve the mystery.  This will be signaled by a “Pause” box. Ideally, write down your answers before you move past the box as that will increase the chances of you avoiding hindsight bias.   

Finally, as you go through this process and think about what you would do, don’t just think about your answers, think about the specific techniques you used to get those answers. The techniques you use to get an answer can be just as important, if not more so, than your actual answers.

Today’s Mystery: Affordable Eyecare

I’m a social enterprise and my dilemma is I want to get glasses and eye exams to a population that is low income, but they’re actually working. We want to use a business model, in other words selling a product or service, without resorting to government support or grants. How would you tackle this issue?

For us at the Trico Foundation, the first step is usually the Blender (you can find an introduction to the Blender here and examples of using the Blender here: video and transcript). This is a particularly simple problem so many of you may be thinking “I could figure out what the challenge is here without the Blender”, but we still find it is just a good exercise to force oneself to go through the Blender.

As users of the Blender get more familiar with it, we hope they’ll come to the point where, whenever they think of a social enterprise, they go straight to asking:

  • How does the social model actually serve a customer need [detailed in the far-left hand column of the Blender]?, and
  • How does the social model impact costs and pricing [detailed in the far-right hand column of the Blender]?

That said, let’s go through and fill out the full Blender. We provide the text for this process below. You can also see the filled out Blender (Note: The best way to read a Blender is from the ‘outside in’ – read the two middle columns and then they help you to fill out the diagnostic columns on the ‘outside’ of the Blender) here.

  • Start with the left middle column, “Assessing Your Social Model’s Impact on Social Needs”:
    • The social mission: The social mission is essentially the social enterprise’s Why. Here the social mission is to help low-income employees see better.
    • The social model: The social model and social mission can sound very similar, but there are different. The social mission is the good you want to do and the social model is how you want to do that good. Here the social model is providing eye exams and glasses to low-income employees. Now, typically there would be more to it than that in terms of the model, but we haven’t figured it out yet, so there’s going to be some portions missing.
    • The customer need being addressed: That’s pretty easy, it’s the need to see better.
    • Beyond a customer buying social, could the social model’s role in addressing customers’ needs be replaced by a traditional business? It’s hard to say right now because we haven’t really figured out what the social enterprise is going to be. We suspect that if they could figure out how to do this, eyeglass companies would be doing it already. Again, hard to say because we haven’t quite figured out the social enterprise we want.

  • Going to the right middle column, “Assessing Your Social Model’s Impact on Costs and Pricing”. In this case, the issues is this column are a bit easier to figure out.
    • The costs the social model would add to the venture: Those costs are the eye exams and the cost of glasses.
    • Can those costs be passed on to the customer? No. That’s where the big challenge is right now.
    • Beyond a customer buying social, how does the social model enhance the value of the product or services? Not sure it does right now. Again, the challenge is we’ve got a ‘half- baked’ idea right now, all the questions can’t be answered fully. There is still a benefit to filling out the Blender with a ‘half-baked’ idea because it confirms many of the key questions we will need to answer in order to solve our mystery.       
    • If the social model does enhance the value of the product/services, is the customer willing and able to pay more for the enhanced value? Right now, the social enterprise doesn’t enhance value, and in any event the customers are low income so there is a real question of whether they could pay in any event.

  • Let’s now go to the outer columns which is where the key power of the Blender, its diagnostic aspect, happens. We’ll start with the outside left column, “the degree to which the social model addresses customer needs”:
    • Again, this one is a challenge right now because we don’t have a fully-baked social enterprise model, but our best guess is this social enterprise would be in the middle panel, which is, “the social model has a role in addressing the customer’s needs, but that role could be replaced by a traditional business.” It’s actually hard to say, but the feeling right now is that’s the area this social enterprise is in.

  • Moving to the outside left column, “how the social model impacts and costs and pricing”:
    • The clear dilemma here is the social model adds costs that can’t be passed on to the customer. The Blender is very good at flagging challenges and all of them can be overcome, but the one that typically is the most challenging is the one that applies here, namely, “the social model adds costs that can’t be passed on to the customer”.

Here the Blender has once again confirmed its diagnostic power. In this case, it confirmed the horns of the dilemma that many social enterprises face, namely, “how can we have a sustainable business model when customers are low-income?”

It can be very useful to ‘follow the money’, or more accurately, the value creation. What do we mean by that? Fortunately, the Blender gives us a hint. Specifically, the column on the far right, which focuses on “how the social model impacts cost and pricing”.  Within that column we need to focus on the last panel. The last panel says, “while the social model may add costs that can be passed on to the customer, it also enhances value in a way that the customer is willing and able to pay more for”.

The power of that panel is it focuses us on the question of value creation for the customer. Here we are not talking about just any value, it needs to be value that the customer is “willing and able to pay more for”.  Obviously, glasses are very valuable because they help people see, but are there any employees who, if they can see better, would earn more? And that’s where we go, “Aha!”, because there are employees in the world who work in fields who are paid based on how much they collect, essentially a commission system. Theoretically, if we gave them glasses that enhanced their productivity, they could use that enhanced value (i.e. enhanced wages) to cover the cost of the glasses.

That’s exactly what VisionSpring does (see media release below). VisionSpring is a social impact organization that’s dedicated to providing glasses to people who have income of less than $4.00 a day. Some of you may be tempted to say, “Hold on a second, you were talking about a social enterprise model without grants, and here this news release says they’ve got a grant of $15 million, doesn’t that violate the parameters of our mystery?”

Two points:

  1. This is all about training you to see where the market (business model) is and the fact that they’re using grants doesn’t mean there’s not a market here. In fact, through its research VisionSpring found that although it can be tight because these are low-income individuals, it is theoretically possible to have the low-income workers cover the costs of the glasses from the gains in income they make from the glasses. You may have to do financing options, but there’s a market here. It’s theoretically possible. Even if you look at the headline of the news release you see a $15 million grant will help generate $1 billion of income. The $15 million needed to do the program is just 1.5% of the income generated. Clearly, it’s possible to have a viable business model here.
  2. Look at what the founder of VisionSpring says: “The idea was to reach tens of millions of people, using philanthropic capital to kick start the business but ultimately scaling through market forces.” They’re using the grants not to always rely on grants, but to kick start the business model. This approach makes sense, because it is exploratory. Low-income people are going to be very reluctant to spend their money on something that may not work. Vision Spring is using grants to prove the model. That is why VisionSpring sought independent research to confirm that the small cost of glasses is easily recouped by the income productivity.

For agricultural workers on commission this clearly makes sense. VisionSpring started with agricultural workers in tea, and they are looking to expand to coffee workers, cocoa workers, and other artisans. But what other employees could you extend this to?

What jumps out to us is manufacturing. It clearly would work for factory employees who are working on commission, but there’s not many factory employees that work on commission. What would we do for factory employees that don’t work on commission?

The answer again is to ‘follow the money/value creation’. If employees aren’t getting the benefit of the enhanced value, but the eyeglasses are enhancing productivity, that means the employers are getting those benefits. Why not have the employers cover the costs of the glasses out of a portion of the profits from the enhanced productivity?

VisionSpring tried exactly that, but they found the manufacturers (as opposed to the employees) were very reluctant to engage in this. In fact, they said “our employees don’t need glasses, why would we ever bother doing that?” The attitude of the manufacturers was so bad they had been known to pay women who wear glasses less than women who don’t, because there’s the stigma of “if you’re wearing glasses, your eyesight must be bad, which means you must be less productive”. What would you do if the manufacturer said “we’re not going to be involved, we don’t believe eyecare is needed”?

Apparently, in manufacturing nowadays manufacturers rarely produce their own goods. They do contracts. As a result, VisionSpring approached the brands who employ the manufacturers. Note brands are also the ones that have the bigger public profile and therefore are more susceptible to bad public relations. As a result, the brands were willing to get involved. Partnering with leading brands also opened the door to engaging with manufacturers.

Source: Business Wire

This again drives home the power of following the money/the value creation and asking “who would be more open to this because they can gain value?”

A Few Words on Influence

The Trico Foundation’s social entrepreneurship training materials mention there are four ways of impact for any business model. One way to have impact is through influence. What VisionSpring found is there was such a stigma from the manufacturers in terms of being anti-glasses there was a concern employees wouldn’t come forward to participate in eye exams. What VisionSpring did in terms of influence is make sure the managers and the factory floor leaders were the first ones to come forward, get eye exams, and show how it benefited them. Participation by the factory leadership then influenced and inspired the other people on the factory floor to participate in the program.

Back to the Blender

We probably don’t need to do this, but let’s just run through the Blender again to see how this new idea for a business model has impacted our social enterprise. Obviously, there’s two different customers with the options we found – one option has employees as customers and the other option has brands as customers. Because the answers will be basically the same we are just going to work from the idea that we’re still selling directly to the employees as opposed to the brands.

As with the previous Blender, you can simply click here for the new Blender or look at the text we have provided below. What we’ve done in this one is keep the answers from the previous Blender whenever the answers would be the same even with our new idea:

We are going to focus on the questions in the middle right column:

  • “Can you pass those costs on to your customer?” Yes. Yay!
  • “Beyond a customer buying social, how does your social model enhance the value of your product services?” Our new solution helps them more earn more money, which is great.
  • “If your social model does enhance the value of your product/services, is your customer willing and able to pay more for that enhanced value?” We still don’t think they really are able and willing to pay more than the going price for glasses. Certainly, we can learn our way into this and see if they are. For right now we are going to play it safe and say they aren’t willing to pay more than the standard market price for glasses (Note: we believe VisionSpring charges less than the typical market price for glasses).

Then we go to the left middle column and the panel that relates to the social model’s impact on customer needs:

  • “Beyond a customer buying social, could your social model’s role in addressing the customer’s needs be replaced by a traditional business?” This one is tricky. You have to keep in mind, the issue here is not whether they can copy your model. The key here is can they copy your model without embracing the social model? Here we don’t think they can. We don’t think mainstream competitors can compete with this model unless they’re willing to reduce the prices or do something similar to what our model is proposing.

Now let’s fill out our Blender on the outside columns, the diagnostic part:

  • Let’s go to the far-right column, “How the social model impacts cost and pricing?”
    • We have selected the middle box says which says “The social model adds costs that can be passed on to the customer.” Yay, that’s big.
  • Next is the far left, “The degree to which the social model addresses the customer needs.”
    • We feel this social enterprise is in the last panel, where we don’t think anybody can copy it unless they’re embracing the social model.

A key benefit of the Blender is not necessarily whether you’re right or wrong in your particular decision of where you land in the diagnostic, the key benefit is flagging things to watch out for. While we are feeling pretty confident that the business model can’t be copied without having to copy the social model, the fact that we are not quite sure, that we debated it with ourselves, means we should still keep a sharp eye on the competition. That said, so far things are looking really, really good.

In terms of people copying your social enterprise, there’s a quote from the founder of First Book that we would like to share. You can learn more about First Book here. Essentially, First Book embraces a great social enterprise model where they’re leveraging their particular capacities to lower the price of books for those who serve kids in need. Their founder, Kyle Zimmer, who’s one of our favorite social entrepreneurs in the world, has this amazing quote: “We feel very confident of our ability to compete in the marketplace, but First Book is fundamentally a mission focused organization. If the result of increased competition is that books become more accessible to children in need, then we have accomplished our goal.”

We want to flag this because when you’re doing social enterprise work you have really three options when it comes to your attitude about markets and competition. Most social enterprises just participate in the market, which means, “I just want to earn some money, and as long as I’m earning some money, I’m fine.” Some social enterprises actually want to dominate a market which is “we’re the only ones who can do this, or we’re the number one provider, top of that market”. Some social enterprises want to transform a market, which is “I want to change how that market operates and if other businesses start copying me and doing that, I’m content with that because I’m trying to affect a bigger change.”

Chances are, if you want to transform a market you probably couldn’t even do that yourself. As a result, it’s actually not the worst thing in the world that other so-called competitors are coming in to that market and doing what you do because that is how you want that market to operate. This harkens back to when the Trico Foundation training materials talked about Ann Mei Chang’s example of the pull of markets and the cell phone.

We wanted to flag this so you can ask yourself if you are looking to participate in, dominate, or transform a market.

Mystery solved! But….

Bonus Coverage: A Deeper Look Into the History of VisionSpring

Because we’re examining VisionSpring we wanted to tell you about their history and their efforts at trying to figure out a social enterprise model.

We should point out, in the intellectual exercise we mentioned to you at the beginning of this blog we zoned in on providing glasses for those who are working. VisionSpring’s target is much wider. It’s anybody who has income, whether it’s from employment or otherwise, that’s living on $4.00 a day or under. They were thinking, “how can we generate revenue in doing this, how can we use a business model to serve our social mission?”

Their first idea was to employ women in villages to sell glasses door-to-door. The second idea they developed was a hub-and-spoke model where they had stores that sold glasses. Their third idea was a van that moved around selling glasses. The final model they developed, the one they currently operate, is leveraging the supply chains of certain partners. For example, BRAC, which is an international community development agency, has women provide medical services in various remote communities. VisionSpring uses that supply chain to have these women also sell eye-glasses. Another big supply chain they’re now using is partnering with pharmacies that are located in various villages. The pharmacies now also sell glasses for VisionSpring and of course, the pharmacy makes some money from doing that.

What’s really interesting about this is, for all the sources that we used to go through VisionSpring’s history, (In the Business of Change, Elisa Birnbaum; Lean Impact, Ann Mei Chang; “From Blueprint to Scale”, Monitor Deloitte), almost every one checks in on VisionSpring at a time when they were trying a different model and each resource essentially says “This model is generating a lot of success. They’ve now cracked the code as to what they need to do.” Instead, what VisionSpring found is the three previous models didn’t work that well. This is important for two reasons.

  1. As we said in the first video that we showed you about the three learning journeys, it is important to dig deep on both failure and success. Sometimes what looks like success is actually leading you to failure, and sometimes what looks like failure is actually leading you to success. We will provide a specific example of what we are talking about. The first model VisionSpring tried was women selling glasses going door-to-door. Initially they were selling lots of glasses and VisionSpring thought “wow, we’re onto something here!” But as they looked at the data, what was really happening is the women, quite naturally, were initially selling to their friends and their family. Then, when those markets got tapped out and they were forced to look beyond that, to other villages for example, the model started to fail. You’ve got to see past the surface level of success or failure to understand the causal mechanisms of what’s really going on: what’s really going on and is this leading to something that is sustainable?

2. VisionSpring’s history really drives home why the Trico Foundation focuses on the four steps for moving forward with any key idea you develop:

  • try to shorten your feedback loops;
  • tap into your friendly wise skeptics and those you have camaraderie with;
  • stay in the affordable loss zone; and
  • see if you can do experiments to figure out what you need to learn as quickly, inexpensively, and effectively as possible.

The four steps for moving forward are mentioned throughout Trico’s Mindsets training, but are listed collectively in the Moving Forward portion of it’s Cheat Sheet.

Our favourite example in terms of the shortening feedback loops, the one we always keep in mind, is the Wright brothers example. Yes, your ambition is ultimately the equivalent of developing an airplane, but is there a way of getting the intel you need by going the cheaper route of kites in wind tunnels? Always look at how you can get the information you need quicker, faster, more cheaply. Steve Blank says “a startup is really an organization that’s looking to figure out its business model before the money runs out.” That’s what you’re going to have to do.

Source: Shutterstock

In fact, as we go through our cohorts we are finding one big challenge is making sure social entrepreneurs and their key stakeholders are on the same page, and by key stakeholders we mean funders or board members. Do they both truly agree on how much runway the social entrepreneur has to figure out the social enterprise and do they agree on the key milestones along the way, the interim measures of success, the wind tunnel results to stay with the Wright brothers example, that confirms they are on the right track? Always keep an eye on that.

Bonus Coverage: Taking Impact to Another Level

VisionSpring has been amazingly successful. They’ve been in operation for 20 years and they’ve already gotten glasses to 10 million people. It’s a pretty impressive number. But the challenge is the problem they’ve targeted, which is getting eye care to people living on less than four dollars a day, is a billion-person problem. Even with all their success over 20 years, they’ve made a small dent. That’s why you need to go back to your Why when you have bigger ambitions. The Four Ways of Impact suggests Influence as a possible way to enhance your social impact, and that’s exactly what VisionSpring has done. They realized they needed to have broader partnerships that influence the wider perception of the importance of eye care.

As you can see in the image below, they’ve created an organization called EYElliance. Through EYElliance, VisionSpring works with organizations to advocate for the importance of eye care. They’ve partnered with organizations like the UN, which has created a resolution on eye care, as well as the World Health Organization. EYElliance has created a plan where in 10 years they’re going to reach 400 million people. It’s not a billion, but it’s getting there. That’s the value of partnerships and influence.

Source: EYElliance

Bonus Coverage: Of Donations and Sales Revenue

An interesting story we came across when we were looking at VisionSpring involves their founder. He’s now focused on a social enterprise model, but initially he tried a donation-based model.

He tells the story of working in a donation-based eye clinic. There was a woman from a village who canoed down the river to this eye care clinic to get glasses. Her vision was so bad the village actually called her the blind woman. She was so excited about getting glasses. She gets the glasses and goes away. Two days later she returns the glasses. Because the woman had a rare need in terms of her eye condition, the only glasses they had in the donation model that would meet her needs were some glasses from 1950 that had cat eyes and rhinestones. This poor woman found that when she used the glasses the other villagers made fun of her because the glasses did not match the culture of the village. Even though she could see better with the glasses she didn’t want to wear them because she was ridiculed. Just imagine having to choose between being almost blind or being ridiculed. It just drives home how, although these efforts are well-intended, we always have to be culturally sensitive to the needs of the demographic we’re serving.

The founder of VisionSpring says that experience also drove home to him how the donation model had him fall in to the trap of thinking, “Here’s what I have, you have to take it.” Instead, he wanted a social enterprise model that made him think of her as a customer, where he wanted to make sure he was meeting her needs.

He also noticed when he crunched the numbers that for the donation model it cost $20 to get a pair of glasses to someone, whereas for his social enterprise model it costs $7.00 to get a pair of glasses to someone.

We want to be very careful here. This isn’t about bashing donations. Sometimes donations are the way to go, and sometimes they aren’t. This is about encouraging you to see whether a donation or a social enterprise model, or a combination, is the way that’s going to work for you.

Finally, let’s look at VisionSpring’s revenue and donations over the period that we could get those numbers, from 2017 to 2022 (see chart below). There are number of ways to digest these numbers. One way to look at it is from 2017 to 2022 their growth in donations was 335%. For that same period, growth in sales was 167%. That’s an impressive growth in sales, but it’s nothing like 335%.

You could think “Sales as a percentage of total income in 2017 was 15%. Now in 2022, it’s 10%. So sales are actually dropping as the portion of their complete income. Maybe sales revenue is not that important?” That’s the challenge we find with people analyzing sales versus donations. Instead, you have to look a little bit deeper as to the impact:

  1. The benefit of sales, as First Book learned, lies in it being income that you have more freedom to use as you see fit. Typically, donations are restricted in what you can do with that money. Having a certain amount of revenue that you can apply to the key areas as you see fit or to experiment with, can be very powerful. For those reasons $2.5 million in sales revenue could be just as powerful for an organization as $23 million in donations.
  • We have to stop thinking of sales and donations as ‘either/or’. They actually work together. Indeed, we suspect, but can’t prove, that part of the reason VisionSpring has seen such a huge growth in donations is the success of their sales models and the idea of taking the sales model’s impact to the next level. Don’t think of donation and sales revenue as an ‘either/or’ think of it as an ‘and’. The analogy we’ve been using lately is grants can be like the steamship and sales revenue can be the tugboat. Separately, each has its strengths and weaknesses. Together, a tugboat and a steamship can do truly incredible things.

A Closing Point

That’s all we have to say about VisionSpring. We love ending on this picture (see below) because it’s a picture from our home province, Alberta. It’s actually Pyramid Island. It also symbolizes the idea of you being on a path. A path means choices. Choices are very big aspect of the Trico Foundation training. We talk of owning your journey.  We have mentioned many ideas, but that doesn’t mean you have to do them. We are big believers in informing you and inspiring you, because that increases the choices you have. This isn’t about you copying the things we talked about. It’s about planting the seeds of possibilities for you to consider and, possibly, exploring them as you see fit.

Source for lead and closing pictures: Shutterstock

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