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M-Kopa

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M-Kopa
Company typePrivate
IndustryEnergy, Fintech
Founded2011
FoundersNick Hughes, Chad Larson, Jesse Moore
Headquarters
Nairobi
,
Kenya
Areas served
Kenya, Tanzania, Uganda
ProductsSolar energy
WebsiteOfficial website

M-Kopa (M for mobile, kopa is Swahili for borrow)[1] is a Kenyan solar energy company.[2][3] Headquartered in Nairobi, the company has pioneered and built one of the world's most advanced Pay-As-You-Go platforms to upgrade millions of lives in East Africa (Kenya and Uganda) [4] M-Kopa was launched commercially in 2012.

History

According to the Financial Times, "Moore and Hughes, with banker and micro-finance expert Chad Larson, in 2010 founded the start-up in Nairobi that became M-Kopa the following year. The initial goal was to sell 1,000 units a week within three years. That milestone was reached within 12 months and now the 1,200-strong sales team, who work on commission and incentives, are selling up to 4,000 units a week." [5] Hughes previously set up and ran M-Pesa at Vodafone, a mobile phone-based money transfer, financing and microfinancing service, where Moore also worked whilst completing his MBA.[6] Larson and Moore were fellow MBA students at Oxford University.[2][3]

It raised money in 2011, with incubation by Signal Point Partners.[7] Backing investors have included Richard Branson, Generation Investment Management, Blue Haven Initiative and LGT Venture Philanthropy, an investment vehicle of the Princely Family of Liechtenstein.[8][5] M-Kopa was launched commercially in late 2012.[9][1] The company's initial goal was to sell 1,000 units a week within three years, and that milestone was reached within 12 months.[5]

By 2015, it said it had powered 150,000 households in Kenya, Uganda, and Tanzania, with around 10,000 mobile payments made by users on its cloud platform, M-Kopanet, made on a daily basis.[1] It had over $40 million of revenue by 2015.[10][11] In 2015, M-Kopa estimated that 80 percent of its customers lived on less than $2 a day.[4] In 2015, Bloomberg Businessweek identified M-Kopa as "the solar company making a profit off of poor Africans."[4] In February 2015, M-Kopa announced a plan to blacklist defaulters on its loans with credit bureaus.[12]

It had connected over 300,000 homes in East Africa to Solar power, as of early January 2016[9] In 2016, M-Kopa sold 30,000 solar TVs in Kenya, looking to add internet access.[13] By December 2016, the company had sold around 400,000 systems in Kenya, Tanzania, and Uganda since its launch in 2011, under CEO Jesse Moore.[14] As of 2016, there were plans to begin manufacturing all the products in Kenya.[15]

By January 2018, the company had wired at least 500,000 homes, and sold about 90,000 solar rechargeable televisions.[16] In 2018, it was reported that M-Kopa was going to acquire an additional 500,000 photovoltaic solar panels, under chairman Mugo Kibati, in an agreement with Solinc East Africa.[17] In February 2018, M-Kopa received $10 million in funding from FinDev Canada in a new funding round led by CDC, and including existing shareholders LGT Venture Philanthropy and Generation Investment Management.

Business model and products

Customers pay a deposit of 3,500 KES (approx $35), take the system home then pay 50 KES (approx $0.50) a day for a period of one year,[18] to own the solar system. Daily payments are made through M-Pesa, a mobile phone based money system,[19] at about 45 cents a day.[1] This way, in addition to getting solar power, customers also slowly off-set the cost of the device.[19] As of 2015, after 12 months of regular payments, the solar system is fully owned by the customer who can use it for free access to solar energy.[1]

According to the company, part of the business model's plan is to offset the dangerous use of kerosene (paraffin) lamps to light homes that are off electric grids.[1] The system also helps customers who need to charge batteries and mobile phones.

In 2015, the M-Kopa III device had one solar panel, two LED lights, a USB phone charger, and a solar powered radio that was portable.[1]

M-Kopa 4 had an eight watt solar panel that charges cell phones, a radio and a torch, via USB, includes 2 LED bulbs with light switches, as well as a rechargeable LED torch (flashlight) and a radio.[20] There is a more powerful panel and television in an upgrade package.[21]

M-Kopa 600 comes with a 24-inch flat screen digital TV with a multi-standard decoder supporting both DTH (Dish) and DTT (Aerial), 30W solar panel, TV remote. It includes one solar light with high and low setting, one solar tube light and two phone charging cables.

M-Kopa 6000 has two solar lights with high and low setting, a solar tube light, a solar motion sensor light, solar rechargeable radio, two phone charging cables and a 6m solar light extension cable. These are designed for Ugandan customers to power larger homesteads and businesses.

The company also provides an upgrade products that include; smartphones, water tanks and fridges. Most recently in 2018, the company launched SOLAPESA - a cash loans to existing customers[22]

The company also has a dedicated and ring-fenced R&D unit, M-KopaLabs, which deploys research grants to test new technology and extensions to the M-Kopa platform[23]

M-Kopa is supported by a number of partners. Mobile network operators – like Safaricom – are partnering with M-Kopa to support mobile money and value-added services.  Manufacturers and brands are partnering to provide a platform for market entry, finance and last mile access. Payments companies like Mastercard and challenger banks see the disruptive power of the platform on traditional clicks and mortar banking.[24]

Awards

M-Kopa has received recognition from various institutions. It won the Bloomberg New Energy Finance Award 2014 as well as two awards from the Financial Times for Technology in Sustainable Finance and Excellence in sustainable finance, both in 2013. In 2015, M-Kopa was recognized by Fortune Magazine as one of the Top 50 Companies Changing the World and won the Zayed Future Energy Award 2015,[25] In February 2016, it was recognised as the Best Mobile Innovation for Emerging Markets at the Global Mobile Awards.

M-Kopa was named on MIT Technology Review’s 2017 list of 50 Smartest Companies in June 2017. In March 2016, it emerged boldest at the Financial Times Arcelor Mittal – Boldness In Business Awards in the developing markets category. Fast Company listed M-Kopa in the 2018 Edition of the World’s Most Innovative Companies and number four out of 10 in Africa. The company was also named among the global Cleantech 100 companies in 2019

References

  1. ^ a b c d e f g "Pay-as-you-go solar power takes off in Africa", Anmar Frangoul, CNBC, February 25, 2015
  2. ^ a b Mutiga, Murithi (2015-07-11). "Barack Obama goes back to Kenya: 'It's like JFK going back to Ireland'". The Guardian. ISSN 0261-3077. Retrieved 2017-08-22.
  3. ^ a b "Social enterprise MBA | M-KOPA Solar | Saïd Business School". www.sbs.ox.ac.uk. Retrieved 2017-08-22.
  4. ^ a b c "The Solar Company Making a Profit on Poor Africans". Bloomberg.com. Retrieved 2017-08-22.
  5. ^ a b c Aglionby, John (March 17, 2016). "Lightbulb moment for M-Kopa". Financial Times.
  6. ^ "Pay-as-you go solar takes off in East Africa | Corporate Knights". Corporate Knights. 2015-06-11. Retrieved 2017-08-22.
  7. ^ "Banking on the Poor", Stanford Social Innovation Review, Dennis Price, 2016
  8. ^ "M-KOPA". Crunchbase.
  9. ^ a b "How This Solar Startup Became a Multinational Social Enterprise". Triple Pundit: People, Planet, Profit. 2016-01-22. Retrieved 2017-08-22.
  10. ^ "M-KOPA's Founder on Bringing Hundreds of Solar Jobs to East Africa and What He Looks for in New Hires". MindSky. 2015-11-13. Retrieved 2017-08-22.
  11. ^ Odengo, Rose (2015-11-13). "East Africa: M-Kopa's Founder On Bringing Hundreds of Solar Jobs to East Africa and What He Looks for in New Hires". Akilah Net (Kigali). Retrieved 2017-08-22.
  12. ^ "M-Pesa solar dealer M-Kopa to blacklist defaulters". Business Daily. Retrieved 2017-08-22.
  13. ^ "Kenya: M-Kopa Sells 30,000 Solar TVs in Kenya and Looks to Add Internet Access - Expanding to Uganda and Tanzania", AllAfrica, December 2, 2016
  14. ^ "Africa Finds Power Off the Grid", MIT Technology Review, Jonathan W. Rosen, December 2, 2016
  15. ^ "Solar-powered televisions brighten homes in rural Kenya", August 1, 2016, Reuters
  16. ^ "Outdated policies, high taxes discourage uptake of solar", Abel Muhatia, January 17, 20178, The Star
  17. ^ "M-kopa strikes deal for 500,000 photovoltaic solar panels", Patrick Alushula, January 16, 2018
  18. ^ Aglionby, John (2016-03-17). "Lightbulb moment for M-Kopa". Financial Times. Retrieved 2017-08-22.
  19. ^ a b "Power hungry". The Economist. Retrieved 2017-08-22.
  20. ^ "Products". M-KOPA Solar. 2014-11-28. Retrieved 2017-08-22.
  21. ^ "In remote Kenyan villages, solar startups bring light", PBS.com, November 22, 2017
  22. ^ TechMoran (2018-08-17). "Kenya's M-KOPA launches SOLAPESA to advance cash to its customers". TechMoran. Retrieved 2019-04-02.
  23. ^ "M-KOPA Labs | M-KOPA Corporate". solar.m-kopa.com. Retrieved 2019-04-02.
  24. ^ Editor, A. D. C. (2018-10-26). "Mastercard, Centenary Bank And M-kopa Solar Roll-out First Of Its Kind Energy Solution In Uganda". Africa.com. Retrieved 2019-04-02. {{cite web}}: |last= has generic name (help)
  25. ^ "Press release details –Zayed Future Energy Prize". www.zayedfutureenergyprize.com. Retrieved 2017-08-22.
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