Partnering with an NGO to start a Microloan Program in a Ghanaian Village: a global organic triple-bottom-line social enterprise in the making.

Stephenson, Harriet ; Mace, Donna L.

CASE DESCRIPTION

The primary subject matter concerns social entrepreneurship which incorporates the triple bottom line. Secondary issues include financing new ventures, human resource development and motivation, globalization of collegiate curriculum with experiential/service learning methods, globalizing microenterprise, and entrepreneurship in a nonprofit. This could be used in for-profit or nonprofit management or entrepreneurship courses, developmental economics, and finance. It has a difficulty level of four, appropriate for senior level and five, appropriate for the first year graduate level. The case is designed to be taught in 1-3 class hours with two hours of outside preparation that can be done online.

CASE SYNOPSIS

The director of a student consulting program in a university hears about a way to globalize the program by partnering with an NGO in Wilmot, New Hampshire, WomensTrust, to start a microloan program in a Ghanaian Village. A meeting is called with interested colleagues, alumni, and students. There is support for the concept but several other possible scenarios are proposed. A go with Ghana decision is made somewhat unilaterally and without a business plan. Entrepreneurial enthusiasm abounds as in a typical start-up. The team must now quickly do its homework--get the buy in of the relevant stakeholders especially the Dean of the Business School, and the University Administration. The Dean would be concerned about the level of positive impact on students and alumni and mitigating possible increased overload on faculty. The University is concerned about liability and safety issues. There is a desire to make sure this is a triple-bottom-line social enterprise, which achieves desired outcomes of helping empower women to have more secure lives for themselves and their families. The people, profit, and planet aspects must be addressed. Is there someway of getting to Ghana without burning tons of carbon dioxide during a 14,000 mile round-trip flight? The model calls for investing $15,000 to begin a microloan program that charges interest to its peer lending group members and then becomes self-sustaining at 400 borrowers. How are they going to raise the $15,000 to start the process? It is an organic development model which starts with microloans and may grow into providing help with education, health, and meeting other needs if the women feel that is what they want. How will that be financed? What if the team doesn't get the buy in? The reservations cannot be canceled.

IT BEGINS WITH A TAXI RIDE TO THE AIRPORT

B. Barnsworth, in her seventh and final year as Endowed Chair of Entrepreneurship at Brandon University in Spokane, Washington, wanted to make a difference with this year to be a part of something meaningful. She had recently attended the Global Microcredit Summit in Nova Scotia. It had been an exciting conference following the announcement of Muhammad Yunus receiving the Nobel Peace prize for his highly successful efforts with the Grameen Bank and the peer-lending model in Bangladesh with microcredit and empowering very poor women with very small loans. B.B. had been in microenterprise endeavors using a model, the Small Business Institute, to have students in the senior capstone course work together on teams with microenterprises and small business owners to do in-depth analysis and business plan with the owner. She was hoping to be able to globalize the course with coverage of microenterprise as economic development model generating business plans that could compete in social enterprise track of business plan competitions. These two wishes were about to merge.

As she was waiting for van to take to airport, she met two other conference attendees who wanted to go to airport also. They were from Wilmot, New Hampshire, USA. The three of them agreed to split a taxi fare. From the minute the doors closed and during the half hour ride to the airport, B.B. learned about a unique program from Susan Kraeger, the Executive Director of WomensTrust and Dana Dakin, the founder. Dana Dakin had "adopted" a village in Ghana-Pokuase, close to Accra, where she started a microlending program to small groups of women. In the process, she had hired an Executive Director. They were now on a crusade to encourage others to start similar programs in any developing country on their own or it could be possibly contiguous to WomensTrust in Ghana and operate under WT's 501(c)(3) umbrella.

The taxi ride ended too soon. Upon getting back to Spokane, B.B. checked out the WomensTrust.org web site www.womenstrust.org. It really sounded like this might be the answer. B.B. convened a group including an Econ-Finance faculty member who had recently proposed some innovative student involvement in investing funds and possibly investing in microenterprises, the Management Department Chair, the other senior capstone course instructor, a faculty person out of the Provost Office who runs a Global Student Internship program, a business law faculty member who had published a definitive work on social enterprise who had just put on a program on indigenous people, alumni from an MBA Social Enterprise/Triple Bottom Line course; a student in the Executive Masters in Nonprofit Leadership program, a Management faculty member who had interests in helping in villages, and a visiting professor in Econ and Finance who had indicated interest as well. It was billed as an exploration of the concept of adopting a village and hearing more about the WomensTrust program.

THE SOUNDING OUT MEETING

The following meeting occurred as recorded by the Entrepreneurship Center's administrative assistant, over a catered lunch.

December 8, 2006, 12-2 p.m., Smith 416, J.F. Scribe

Betsy Barnsworth, C.B., J.Q., C.W., D.M., M.E., G.L., C.C., Madhu R., D.L., Meena R., S.M., and Susan Kraeger, from WomensTrust, Inc. (via conference phone).

* Interest in Entrepreneurship Center is to find something to invest in locally

* It is exploring how to best utilize its anticipated $1 million endowment to support local microenterprise.

* However, as Endowed Chair of Entrepreneurship, Barnsworth is looking at a "partner with a village" model

* Can choose to serve a village and then get involved in a certain area of their development (AIDS, clean water, etc). You get to chose the village and determine how involved you want to be.

* Susan Kraeger enters conversation by teleconference to give the WomensTrust story:

* Background on WomensTrust: founded in 2003 by Dana D. Decided to at 60 she wanted to give back so traveled to Ghana in search of a village she could adopt and start a microlending program for the women. Dana D. found a village, met with the women and they were interested. She started a microlending with $1700 for 72 women ($20 each about), asked women to meet in groups, found someone to administer the program in Ghana, and she returned to the United States to oversee it. After a year, they lost site of the group lending concept, repayment rates were low and they were not meeting their full potential. Susan went over in 2005 and met with the women. They wanted larger loans, higher caps for reliable repayers. Currently have over 500 clients and over $30,000 portfolio on the ground working and two staff in the village that are covered by the interest. Discovered women need not only access to credit but also access to education and healthcare as well to individually sustain themselves above the poverty level. This larger picture is the goal now (not just microlending) (redefinition of sustainability). They look for women who have businesses--they are not trying to help women start businesses. Ask the women what they need and what would be helpful and then they work with the women to develop the programs and what they need. 85-90% repayment rate. The interest rate has been tied to the going rate of 39% in the local banking community (which the women are not qualified to access) with 13% for 4 months being the going rate for WomensTrust. 90% of clients sign their paperwork with a thumbprint and are illiterate. Loan program can run itself. They raise money for their education programs and other programs separately from the microlending.

* For $10 American year, Ghanaians can sign up for national healthcare and it includes their kids. For those women who repay their loans, they pay for the 1-year coverage (through another woman who gives $10,000/year).

* Women's Trust: provides umbrella services to other organizations that want to work with them in line with their goals and mission. They are also very happy to share their model and work with others in developing other microlending programs anywhere in the world.

* The women have shown an interest in learning more skills anu there are a number or skill building classes they would like to have. One issue is that after dark, there are no lights so they can't do the programs at night and then the women work during the day so it's been hard to schedule these. Want to build a resource center, where there will be an electric generator, computer, space for classes, library. These are the kind of things they are looking at. They have been working with the poor and very poor--this is their primary target. Would also like to engage women a level or two up from that to look at new markets, small business planning, marketing, etc. Want to get everyone up to a certain level and then want to take the climbers further if they are willing to go.

* What's being done to help the community at large? Rotary Int. has a water program and builds wells in the developing world. Talking to community about implementing educational programs regarding wells. People don't want to use them because it's hard water and it doesn't taste like the river water. No running water in the community of 20,000 people. Interested in building latrines. People live to about 60 years old. Anything above that makes them a burden to their families.

* Potential for backlash by men as the women become more empowered? Women have always worked in West Africa and according to creationism, women were given the gift of productivism so it's not unusual for women to be involved in business. Have seen cases where men have sent wives to get a loan and then have taken the money and disappeared. That's why the group approach is so important in microlending. At this time, they are not hearing a lot about domestic violence as an outcome of this program. It's just an issue regardless.

* Critical mass for microlending program is 400-500 women (to support administration).

* Local government: they know they are there and WT keeps them updated on what they are doing but they do not work through the government. The government allows them to come and go when they please.

* Everyone in Ghana who is educated speaks English. Currently a college in the country that teaches computer training and technology to both young men and women. This is unusual because girls rarely get access to computers. They can't get computer time. The boys always get it. The college is 45 minutes from where this program is working.

* Working on building relationships with other organizations in Ghana that are already existing to help women.

Executive Director is thanked and leaves the meeting (hangs up phone). What's the outcome of this meeting we are aiming for? Where are we going?

* Determine if there is any interest in (adopting) Partnering with a village?

* Is there a model we could bring forth?

* Is there something here that we want to pursue?

Thoughts?

* Maybe partner with the "computer university" in Accra and play on the Microsoft/NW connection.

* J.Q.--interested in partnering with a community that is being hard hit by AIDS. Grandmothers are prostituting themselves to take care of their grandkids because the mothers are dying of AIDS. In turn, the grandmothers are then dying of AIDS from prostituting themselves.

* MeenaR--Mentioned Clouds of Hope orphanage.

* MadhuR--What are we looking at Ghana? We have other connections in countries in Africa. Would we be interested in partnering with any of them? Ghana only or do we want to expand the idea?

* J.Q.--maybe partner with Catholic Relief Services? They are in 96-97 countries already and may be able to help facilitate our partnering with NGO's in those countries.

* B.B.--create a model that could conceivably be used within the Jesuit schools. Could build through internships within the university as well. The bottom line is that if we are located closer geographically to whichever country we choose to work, we will have a better chance of success and getting people involved.

* C.B.--W.T. was fortunate to pick that village. Feels their success was built on the fact that they started small. Concerned with the consortium approach. Don't over engineer grassroots.

* G.L.--the way to generate financial support at this school is to say that we could create a model that could be adopted by other Jesuit universities. We get more support that way.

* C.B.--we have to make sure whatever we do benefits the whole village, not just the micro lendees.

* C.W.--if we're serious then we need to go and learn from people already there, find out what they need and then begin to think about building a model and getting involved. We don't want to build a top down program with no information.

* J.Q.--would be nice to connect it to where some of the other Jesuit organizations are in Africa, which is the world-wide focus of the Jesuits right now. Need to look at Ghana but think we should keep our options open and look at the social justice issue since that's our mission.

* G.L.--maybe start a dialogue with all the countries we're interested in. Then divide it up and everyone looks at different areas and then come together and determine the next step.

* C.C./J.Q.--stake in the ground that we're interested in Africa.

* G.L.--very successful women organizations in Spokane that maybe we could tap into for funding, etc.

Thanks, J.F. for taking such great notes. Thank you all for coming and giving your inputs! I will be back in touch with you individually to discuss your interests. Great ideas. Excellent questions and insights.

The group seemed to want to do a bit of research and get more information before deciding on one program model or country.

However, B.B. was really sold on the WomensTrust model and was eager to get going. This one sounded like it would be a great one for the SBI to sponsor. It could be piloted here as a national model for globalizing the SBI programs. Shortly after, Susan Kraeger and Dana Dakin went for their regular twice a year trip from New Hampshire to Ghana. This one was to kick off the "World Class" program that a group of Skidmore College's Class of 1971 was sponsoring.

They were giving circles of people "who share a passionate concern for human rights and poverty issues. It is particularly concerned with the plight of women and children in Africa, home to many of the world's 'poorest of the poor'

THE VILLAGE IN GHANA DECISION

Over the next few weeks, a core of the initial group had emerged as very enthused about partnering with a village and to work under the umbrella of the WomensTrust group rather than to go it alone or explore other partnerships in other places. They felt that the political stability and safety factors were more certain in Ghana plus it was deemed as a positive that English was the Ghana language though the villages would have their own languages. These villages outside of Accra were too small to be of interest to the large aid organizations such as Catholic Relief Services and the Grameen Bank and World Vision. B.B. sounded out WomensTrust about the availability of a contiguous village. As a matter of fact, they might have one in which WT was already running a women's literacy program staffed by a local village leader. There was indication that the village would be delighted to have a microloan program. They had also heard about the program's success in nearby Pokuase from word passed by some of the women in the peer lending groups. This was an appealing model to the core group.

The core 4-some has reservations for spring break to meet with WomensTrust Exec Director to get crash immersion course and possibly help vet a village where a microfinance program could be started. The Econ professor is going to build two modules into an economic development course on global and local microcredit and microenterprise and will follow the case as a live case for the class that will be offered once a year beginning spring.. The Executive Master's in Nonprofit Leadership student, D.M., is building her final project around this. B.B. is developing this case to present at a professional conference and added a module in the winter capstone class with this case. She is also seeing how long she can continue to finance this project with her own monies. There is no written plan. J.Q. is looking at possibility of placing an intern in Pokause during the summer of 2007 as part of program of placing global interns that she is in charge of out of the Provost's Office. The MBA alumni have started recruiting a core group to strategize. D.M. provides the first copy of a prospectus:

One village, two circles at a time

World Class Partnering

WomensTrust / Brandon University

Prospectus; 1/3/07

Our Story

Have you ever stopped and really thought about what it must be like to try to survive on less than $1 a day? Do you feel up to speed on the plights of women and children living in places like Africa? And in your deepest soul, have you ever stopped to contemplate the special vulnerability of our sister females enduring real human rights abuses daily?

Perhaps you'd like to do something--something tangible; something you can put your hands on and be a real part of. You believe you have the entrepreneurial skills and passions that could help make a difference, but then you stop and think to yourself "there must be a more efficient and satisfying way to plug in"; a better way to honor your education, your creativity, and the power of real collaboration towards helping our sisters and their villages achieve self- sufficiency and gain their basic human dignity. That's what B. Barnsworth thought too.

In her seventh and final year as Endowed Chair of Entrepreneurship at Brandon University, B.B. wanted to make a real difference. She had recently attended the Global Microcredit Summit in Nova Scotia; an exciting time following announcement of Muhammad Yunus receiving the Nobel Peace prize for his highly successful efforts with the Grameen Bank, peer lending model in Bangladesh, and microcredit--the successful empowering of very poor women with very small loans. Having been in microenterprise endeavors for many years using the Small Business Institute model, where students work in Capstone course teams with microenterprise and small business owners, B.B. hoped to globalize the course. She felt sure these two important things were about to emerge; she just wasn't clear how.

That same day in Nova Scotia, B.B. ended up sharing a riveting cab ride with two other conference attendees from the WomensTrust organization based in Wilmot, New Hampshire, USA; Susan Kraeger, the Executive Director and Dana Dakin, its founder. A few years back, Dana Dakin had begun partnering with a village in Ghana--Pokuase, where she had started a microlending program with a small group of women. Since then, she had hired an Executive Director. Together, the two were on a crusade to encourage others to start similar programs in any developing country on their own, and they were allowing for other nearby village partnerships to be operated under their WomensTrust 501(c)(3) umbrella. The taxi ride ended too soon. Upon arriving back to Spokane, B.B. checked out the WomensTrust.org web site, and it appeared she had found her answer. On 12/8/06, B.B. convened a group of potentially interested business school facility and alumni, and one student from the executive masters in nonprofit leadership program. The idea was a hit for many reasons!

WHAT'S SO SPECIAL ABOUT THE WOMENSTRUST MODEL?

1. Starting in Africa--and its incredible problems with AIDS, poverty, and hunger

2. The village choice--right village factors and timing

3. The village circle's needs assessment process

--Village initial needs--grassroots, focus-group assessment with interested women

--Village matching--matching of the goals and hearts

--Village ongoing needs--ongoing focus group assessment

4. Their World Class donor circle approach

--Concerned folks coming together believing they can help solve this problem

--A coming together that's dynamic in a grassroots learning and collaborative way

--A way to scale organically its own microfranchise model to help get rid of poverty

5. Opportunity to make it our own

--Unique and multiple donor circle compositions

--Unique partnering opportunities

6. Opportunity to use it as rich collegiate learning model

7. Opportunity to get hands-on involvement in making a difference

OUR WORLD CLASS DREAM?

A core of Brandon University folks come together now in the spirit of learning and collaboration as well to build in tandem on the Skidmore College alumni team's World Class dream.

** To help empower women to help them help themselves secure the kind of life and livelihood they want for themselves and their families

** In support of Brandon University's mission--a huge supporter of service learning and the education of whole person, as great champions of justice especially for the poor

** In collaboration within the Small Business Institute--piloting a national model for globalization

** In support of promoting a triple-bottom-line and sustainability approach to economic development making sure not to do more damage than good; buying carbon offsets units offset carbon emissions from air travel

** In collaboration across schools--School of Business's "Entrepreneurship Center" with the College of Arts and Sciences' Center for Nonprofit and Social Enterprise Management

** In synergistic learning support of other efforts currently going on in Nicaragua, and in collaborative support with Catholic Relief Services and local Ghanaians

** For increased engagement among alumni

** In collaboration and/or exchange with other universities ... promote adopt a village model

** In collaboration with the Ghanaian Association of Greater Spokane

** In support of Microenterprise and Environment Guiding Principles as developed by the participants at the Microenterprise and Environment Conference, Valley Forge, Pennsylvania, July 2004

WHAT IT TAKES?

First, the microlending. $15,000 is the amount currently estimated for starting up a microlending operation in a new village. Because WomensTrust is a "bottom up" model, one which honors the importance of working at the grassroots level, each donor circle would carry with it both the freedom and the responsibility of helping to develop market-driven programs based on relationships and dialogue with the women of the "village circle". Additional needs here could be tied to loan process, equipment, business expansion, or staffing. The steps?

   Form a circle
   Find a village match
   Come back, organize, and raise money initially to find a microloan
      program ($15000)
   Then consider an endowment and further fundraise to be able to grow
      the village and its needs

Next, what else? Other needs could be related to the women's microenterprise venture (business consulting, etc) or could be much more general and life-skills based. In Pokuase, they provided education for girls; a vital need and one easily taken for granted among those of us attending a school like BU. Other such needs that could come up for a giving circle to address might be: literacy classes for women, monthly stipends for the elderly, special resource centers for women offering access to computers, research and training. The beauty of the circle here-to-circle there relationship, is that each village partnership opportunity can be customized to needs, desires, and resource availability. And just as with the $15,000 funding example above, each new opportunity can become an entrepreneurial challenge to tackle. Just "be the circle", use your natural talents, and be creative about figuring it out!

One Village, Two Circles at a Time

It can seem overwhelming, but its not. Not if you consider the journey as one village at a time, supported by the partnering of two circles at a time--one circle here and one circle there for many women here and many women there.

THE FLIGHT LEAVES IN THREE WEEKS

To this point there has been no official sanctioning of this activity by the University. B.B. is faced with the reality that their core group has about three weeks to get the University's sanctioning of this activity so the team can be going to Ghana with that knowledge. They are meeting to strategize. How are they going to raise the initial $15,000 to say nothing of the possible need to raise many thousands more if their village determines it has needs further than just microlending. Is raising $15,000 in our role as members of a nonprofit different from raising $15,000 for a regular microenterprise start up in Spokane? How could the program in Ghana benefit the students and enhance the learning experience campus-wide for both undergrads and graduates? How will this affect the University's ability to communicate with alumni? How can B.B. show that globalizing microenterprise/microfinance should be a module in the senior capstone course--they already use local microenterprise cases for consulting in delivering the Small Business Institute program? Also the Triple Bottom Line and sustainability are major themes in the course. The loan fund is supposed to be self-sustaining at 400 borrowers. However, concern for the planet is questionable as soon as they board on the plane...so much for not harming the environment and planet. B.B. is concerned about overlooking a relevant stakeholder group. The Dean will be concerned about overloading the faculty even more taking something like this on. This should be a great service learning option but how do they convince others? Could it be scaled to have opportunity to help colleagues in other universities, start or partner in similar programs. How do you make a business plan for this type of venture? What would a viable business plan look like for this? How do you make a microcredit program self-sustaining? How do you deal with liability issues?

Harriet Stephenson, Seattle University

Donna L. Mace, Seattle University