Entrepreneurship Exam Case Study INS275-PDF-EnG

INS275
Social Entrepreneurship Initiative
Nuru Energy (A):
Financing a Social Enterprise

Nuru Energy’s Mission: To replace the use of expensive,
polluting, unhealthy and dangerous kerosene as a source
of lighting for the two billion people without access to
electricity.
x Winner of the 2012 EFMD Case Writing Competition in the

category “African Business Cases”
x Runner-up in the “Social Entrepreneurship” track of the
oikos Case Writing Competition 2012
02/2021-5847
This case was written by Anne-Marie Carrick-Cagna, Research Associate, and Filipe Santos, Associate
Professor of Entrepreneurship, both at INSEAD. It is intended to be used as a basis for class discussion
rather than to illustrate either effective or ineffective handling of an administrative situation.
We gratefully acknowledge the support of the Andy Burgess Fund for Social Entrepreneurship.
Extra teaching materials are available at https://publishing.insead.edu/case/nuru-energy-a.
Copyright © 2013 INSEAD
COPIES MAY NOT BE MADE WITHOUT PERMISSION. NO PART OF THIS PUBLICATION MAY BE COPIED, STORED, TRANSMITTED, REPRODUCED OR DISTRIBUTED
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This document is authorized for use only in Dmitry Sharapov's IEM Entrepreneurship EXAM 21-22 at Imperial College London from Feb 2022 to Aug 2022.
“We are a social enterprise that sought to invent and commercialize an affordable
and clean off-grid lighting system for the world’s poor.”
Sameer Hajee, Co-Founder and CEO of Nuru Energy
I founded Nuru in 2008 with two colleagues from my former employer, Freeplay Energy. Our
goal was to develop a modular lighting system to replace the dangerous and expensive
kerosene lamps that are common in the poverty-stricken parts of Eastern Africa. We also
wanted to create sustainable businesses for local people who could earn an income through
the selling and recharging of these lights. By November 2010, we had developed an
innovative product and launched field pilots in three countries using three different business
models. We are now at a point where we need to scale up our operations considerably to
achieve the societal impact we aspire to. For this, however, we need to focus our efforts and
we need funding. Luckily, I have several financing deals on the table, including a large bank
interested in buying the carbon emission credits we will produce, a company that would like
to acquire us for several million dollars, venture philanthropists willing to put “patient
capital” to help grow the venture, and several individual angel investors willing to commit
smaller amounts of funding for the scaling up process. All of these financing options,
however, have drawbacks that our team is carefully considering. The fall-back option is to
continue relying on grants and prizes to finance the venture.
On a personal level, I have spent the last three years dedicated to Nuru. I am tired of all the
travelling and spending so much time away from my family. I’ve also grown weary of relying
on donations that require the launch of new pilots. I wanted to alter the status quo but it seems
more difficult and slower than I thought. I need a reliable source of growth capital that allows
our team to focus on realizing our vision of giving the world a clean, affordable and effective
lighting system for poor people without access to the grid. At this stage, however, I don’t
know who I should turn to or what route to take for scaling up.
Sameer Hajee – An MBA Graduate Turned Social Entrepreneur

After graduating with an engineering and business degree from McMaster University in my
native Canada, I worked for four years in different engineering and management roles in the
semiconductor design industry in Silicon Valley. In 2003, I found myself with six months to
spare before starting the MBA course at INSEAD. I moved to Afghanistan to work for a
telecom start-up in Kabul that was looking for people to help expand mobile services to
remote areas throughout Afghanistan. It was during this time that I witnessed the amazing
difference that basic technology, in this case mobile technology, could make in the lives of the
rural poor. I realized then that it was this career path – combining technology and
international development – that I intended to pursue after my MBA studies.
In 2004 upon graduation, I went to Kenya and joined the United Nations as a private sector
Development Consultant. There I worked with a small team of business professionals located
throughout the world who believed that companies could engage with developing countries in
ways that were both pro-profit and pro-poor – a relatively novel concept at the time. One of
my roles was to broker partnerships in Kenya – to help companies conceive and implement
business models that would make money while also delivering value to the UN’s
“customers”: the poorest of the poor. One example was in the fruit juice industry. In Kenya,
Copyright © INSEAD 1
despite the wide availability of fruit, the juice companies still imported fruit juice concentrate
from abroad that they then mixed with water and packaged for sale in Kenya. I couldn’t
understand why they didn’t use the fruit from farmers in Kenya itself. My role in this case
was to bring together fruit growers with a domestic fruit juice company by helping them
obtain financing to set up a facility that would take in raw fruit and produce concentrate for
domestic sales and for export. This resulted in reduced costs and increased economic activity.
Nuru Energy: Identifying a Neglected Societal Problem
After a year in Kenya, I returned to Toronto with my wife. By this time I was sure I wanted to
become more involved in the actual implementation of the models that I had worked on in
Kenya. A colleague from the UN put me in touch with the founder of Freeplay Energy1 who
needed help in creating a distribution strategy for rural markets. I went on to work with them
for two years, helping to sell products to different aid agencies throughout the world,
including the Red Cross and the UN. During this time I visited Sudan, Ethiopia and other
poverty-stricken areas of the globe. We were selling low-power electronic products to the
base of the pyramid, such as radios and portable lights that were charged through hand
cranking. I realized, however, that some of the products just weren’t affordable or effective
for the customers we were trying to reach. I also noted how basic services that we take for
granted, such as water and lighting, were missing in many rural regions of the globe,
curtailing the development prospects of entire populations. I had to do something to address
this problem.
By mid-2008, with two ex-colleagues, Simon Termeer and Barry Whitmill, (Exhibit 1) we set
up a venture to address the global problem of lighting. We obtained US$200,000 in seed
funding from the World Bank for the venture we called Nuru (Swahili for ‘light’). The grant
was for the development of a suitable product and subsequent testing in the field. Our multi-
disciplinary team (which by then included industrial designers, manufacturing experts and
development workers) spent the next few months working on the concept of a portable
lighting solution for rural areas.
The first task for the team was to go into the field and observe how people in isolated rural
areas used light. So we lived in Rwanda for the month of July 2008. What we found was that
burning kerosene was the most common way for villagers to obtain light. However, imports
of the substance were subject to restrictions and the prices were usually high as villagers often
bought it on the black market. A survey in Rwanda showed that rural and urban families spent
over US$8 per month on kerosene even though most of the population lives well below the
poverty line, earning less than US$2/day. The world’s poor spend between 10% and 40% of
their income on kerosene! A 10oz. bottle of kerosene (300 ml) cost about 50 cents and would
only produce six hours of light.
In addition to the high cost, kerosene is known for its great health risks – the fumes from
using one kerosene lamp in a tent or small room are the equivalent of smoking two packets of
cigarettes per day. Many homes have poor ventilation, so fuel-based lighting poses serious
health hazards such as respiratory and eye problems. Kerosene is also extremely dangerous,
1 Driven by its core purpose: "To make energy available to everybody all of the time", Freeplay Energy seeks
to maintain its leadership in creating and developing the market for self-sufficient energy products
internationally.
with skin burns being a common occurrence as a result of lamps accidentally knocked over. A
quarter of households reported kerosene-related accidents in 2009, including fires and skin
burns. The fuel also emits carbon dioxide (CO²) and is therefore harmful to the environment.
Kerosene burning for lighting produces 100 million tons of carbon dioxide annually.
Ironically, the light provided by a kerosene lamp is not actually very bright and is therefore
inefficient. Studying or reading next to kerosene light is difficult, thus hindering education in
these regions. We also noted that 90% of the needs for lighting after dark were task-based –
from milking cows to doing homework and cooking. Therefore an entire room didn’t need to
be lit most of the time. We also needed to take into account the villagers’ irregular source of
income. Kerosene was unaffordable for most of the time and further trapped parents and
children in the poverty cycle.
After the field research, we better understood the costs to society that the use of kerosene for
lighting entailed. It dawned on us the enormous positive spill-overs of replacing kerosene
lights at a global scale with a solution that was less costly, more efficient and healthier. We
had found the mission of Nuru Energy.
Designing for the Base of the Pyramid
My colleagues and I had seen how fast-moving consumer goods (FMCG) companies such as
Unilever and P&G had successfully adapted their products to sell to base-of-the-pyramid
markets: they began to package their goods in smaller volumes to make them more affordable
to the rural poor. We needed to find the equivalent for delivering lighting to remote rural
areas.
There were four specific criteria that we aimed to meet when we began designing the lighting
product it had to be:
x valuable to the people (had to directly meet their specific lighting needs)
x something that was a unique product offering (relative to other options available to
them)
x more affordable than the existing alternatives (and the population we targeted had to
be able to pay)
x accessible (there was no point in developing a valuable, affordable product if we
couldn’t ensure access and delivery to the end consumer).
After several months working on the problem, we developed the Nuru Light, a small portable
light that can be worn on the head like a miner, fixed to a helmet, or hung around the neck for
reading – the options are numerous. If for some reason extra light is required – the family is
entertaining guests, for example – the lights connect in modules to make stronger lights which
can be hung on a nail to light up a whole room. It is designed to be practical to use and
effective for multiple types of usage.
The light uses a light-emitting diode (LED) bulb that is unbreakable and so never needs
replacing. The lights are the size of a hockey puck. When fully charged each POD light can be
used between 9 hours (high bright) and 28 hours (low bright) – enough light for one or two
weeks’ usage.
The next challenge to address was the charging of the lights. We developed solutions based
on two conventional methods – the AC charger and the solar panel charger. Our first solution
used electricity with adaptors charging up to five lights at a time.
The drawback is that there isn’t always electricity in rural areas, especially in sub-Saharan
Africa, where nine out of ten people do not have grid electricity. We therefore developed a
second solution based on a solar panel that could charge up to five lights simultaneously.
Unfortunately, this is an expensive unit and solar panels are not an efficient technology – it is
a lengthy operation to charge anything with a solar panel. So we needed another charging
solution if we wanted to have widespread distribution and market adoption. Although
cranking by hand had been used in the past for recharging, we found that people didn’t want
to use this sort of device as it took effort and did not seem natural. We therefore looked at a
more natural system based on pedalling – we have
all seen bicycles whose lights are powered using
the energy generated from pedalling! After some
research and clever design options, we developed
the POWERCycleTM as an innovative method for
recharging the lights. These bike-like stationary
units can produce enough energy to fully recharge
five lights in 20 minutes of pedalling. This is
actually the most efficient way to recharge lights,
as well as being accessible to everyone.
Once we had developed a promising technical design, we needed a convincing business

model that would diffuse our solution widely.
The Rwanda Pilot: Market-Based Business Model
Providers of technical solutions for the poor usually rely on donor funding and free
distribution through NGOs or traditional rural distribution channels. However, mark-ups
along the value chain often make the end product ultimately unaffordable to poor populations.
Although models based on sustainable income were rare in the developing world at the time,
this seemed to us a more promising approach. So we started a pilot in Rwanda, where we had
done our initial field research.
We decided to set up a network of rural entrepreneurs, which created a sustainable livelihood

for people in the villages and also allowed us to get the lights directly into the hands of
consumers with few intermediaries. Our approach was to help an individual or group to set up
a micro business through which they could sell or rent the Nuru Lights and offer a recharging
service via the POWERCycle.TM
Nuru Energy acts as a “coordinator” between the microfinance

institutions (MFIs) who offer loans and micro-entrepreneurs who
are interested in starting a sustainable business to make money.
Supported by MFI partners, Nuru Energy screens and selects
entrepreneurs from local cooperatives to operate their own micro-
franchises. Located in the customers’ communities, each micro-
franchise operator sells lights and can then charge their customers a
small fee to recharge the lights using the pedal generator. Each
entrepreneur can earn up to $13.50 per day. Such an income
launches an entrepreneur comfortably out of poverty, giving them
three to four times the national average income, while still saving
customers 95% on lighting. Indeed, assuming 2.5 hours of light per
day, our solution was 20 times cheaper than kerosene.
Nuru Light Kerosene

Cost per hour $0.007 $0.13
Cost per month $0.44 $10.12
Cost per year $6.50 $118
Nuru targets mainly female entrepreneurs, whose earnings are more likely to be spent on the
education, health and feeding of children, therefore creating a broader social impact. We also
decided to offer training to our entrepreneurs in basic book-keeping and accounting, and to
provide them with marketing materials to help set up and expand the business.
The business model thus offered two revenue streams: money generated from margins on the
sale of the products (lights and charger), which is initially financed by the microfinance
institution, and recharging fees from the entrepreneur. We had people in the field to support
the micro-entrepreneurs, monitor the number of recharges in the PowerCycle and collect the
recharging fees, but we soon realized that it was costing more to recover these recharging fees
than the actual money due, so we are looking for alternative collection models that are more
efficient. In any case, our model provides two revenue streams and could become profitable
over time.
The Kenya Pilot: Donor Based Model
In our continuous search for funding, in 2009 we received a

grant to supply lights for free to particularly vulnerable
groups with no source of income, such as refugees. To pilot
this model, we donated lights to school children in refugee
camps who had no income, and therefore no means to buy
lights. These children’s only chance to escape the refugee
camps is to do well in the national exam and earn a
scholarship to university. Without a light, however, they
cannot study. By providing Nuru Lights, we can give these
children a future. Students at the Gihembe refugee Camp
This model was piloted in Kenya, where we put 100 lights into schools with a charger and
monitored the effect on children’s education. We saw a strong adoption rate among children
and had encouraging evidence of impact on their school efforts and educational results. We
could try to secure more donors to expand the programme to other refugee camps or schools
or by serving poor populations. Two of our team members in particular were excited about the
potential growth and impact of this model.
India – Learning Good Lessons the Hard Way
In the summer of 2009, we made our first move out of Africa to India, home to over 580
million people without electricity (40% of the population is off the grid). The size of the
population we believed could be targeted was as large as that of sub-Saharan Africa (Exhibit
2). Moreover, with India we would be dealing with only one large country and therefore
potentially only have to deal with one microfinance institution, one set of import duties, and
similar procedures involved in setting up operations. Given these considerations, we were
convinced that it would be easier to expand into India, where we could reach as many people
at a lower cost than setting up operations in several different African countries. This was
important given that at the time we still had no stable source of funding.
In September 2009, we partnered with the microfinance company BASIX and, based on their
recommendation and using grant funding, set up a pilot with two entrepreneurs and 100 lights
in two Indian states. They were monitored by BASIX over a four month period. However,
when we received the monthly reports on the entrepreneurs, we were disappointed as they
were making about one fifth of the revenues that the African entrepreneurs were making with
their recharging activities.
On further investigation, we learnt that their customers were only using the lights for an hour
or two at night, during power cuts. We hadn’t realized that the two pilot villages actually had
access to the power grid. Thus when we spoke in more depth with the customers we
discovered they didn’t really want to pay someone to pedal; they would rather purchase the
recharger and charge the lights themselves.
With this in mind, we suggested to the two pilot entrepreneurs that rather than selling in their
own villages, which had access to the grid, they look further afield for customers. Perhaps
they could go to the nearby villages with no access to electricity and set up the POWERCycle
in the weekly markets, offering to recharge lights for the locals for a fee – thus earning an
additional income. While they initially agreed, it was soon apparent that these particular
entrepreneurs didn’t actually like pedalling since their other income-generating activities,
which included mobile phone, music downloads and providing internet access, offered higher
margins with less effort. The demand for Nuru Lights among end customers, however, was
great as we found that the villagers were coming to the entrepreneur and recharging the lights
themselves using his POWERCycle for a fee!
The pilot in India proved to be a learning exercise as we realised that we needed to adapt our
products and business model according to the geography. In mid-2010 we hired an MBA
alumnus, Deepak Punwani, to lead our efforts in India from Mumbai. Another person has
been taken on and is spending six months in the field to discover exactly what works in the
Indian climate and conditions. With this valuable information, we can then adapt the model
accordingly.
Kenya – Scaling Up Too Fast
As we had already piloted the school-based donation model in Kenya in 2009, it seemed
obvious that Kenya should be the next African country (after Rwanda) where we would set up
our commercial micro-franchise operations. Although we didn’t have funding for this
expansion, I was confident that it would be forthcoming. Therefore, in January 2010, I
recruited a recent MBA graduate from the Spanish school IESE to launch Nuru Energy
Kenya. Her first job was to find local MFI partners – once an MFI was on board, the next step
would be to find entrepreneurs and organise the logistics of the operations. After six months,
however, my forecast of closing a financing deal by early 2010 proved to be too optimistic.
We had several options on the table but no obvious or ideal choice. Since we hadn’t secured
financing for the Kenyan expansion in due time, our Kenya manager became frustrated and
finally quit, forcing us to interrupt our expansion plan into the country.
Financing Nuru Energy

Nuru Energy’s growth up until November 2010 had been a somewhat frustrating stop-and-
start process, dependent on awards and grants obtained from a variety of organisations
(Exhibit 3) – which were the lifeblood of Nuru Energy. The total amount (over US$400,000
to date) had enabled us to pursue what was perceived early on as a risky idea and make it
tangible. We had scaled up to a certain level and done several pilots so that commercial
financiers could see our progress and have the confidence to make an investment. Although
we were delighted with the interest generated among the donor community, we didn’t think
we could rely on grant funding to scale up and reach profitability.
We were working with an annual budget of US$200,000 at the time. This covered local field
staff salaries, office rental, and transport to and from the field to identify, select and train
service entrepreneurs. It also included all the manufacturing and shipping costs of the lights
and POWERCycles and international travel for the management team, who were not all based
in the same location. By this time, the staff had expanded. There were the three co-founders –
myself, Simon Tremeer (our Manufacturing director) and Barry Whitmill (our Design
director). In Rwanda, there was a country manager, a grants manager and three field staff.
There were also two staff members in India: a country manager and a field manager.
I had spent most of my time and energy in the last two years building awareness of Nuru
Energy worldwide in the hope that it would lead to suitable and sustainable financial backing.
With this goal in mind, I had been pursuing different types of investors.
Angel Investors
I started out thinking that an easy way to raise financing quickly would be to look for money
from high net worth individuals, especially given the interest that Nuru had generated over the
last two years. We were looking for finance partners who could add value beyond the capital.
I considered several angel investors and discussed different options with prominent wealthy
investors throughout the world. However, we were looking for more than US$250,000 and
none of them were willing to invest sufficient capital into Nuru on their own. The pre-money
valuation I was discussing was US$750,000 or US$1 million post-money (i.e. US$250,000
investment for 25% equity). If we syndicated several angel investors it would have met our
financing needs, but I didn’t want to deal with multiple stakeholders and the different ideas
for the company’s future they might have.
Social Venture Capitalists/ Venture Philanthropy
I also contemplated social venture capitalists – they were less demanding on time and had
“patient capital”, realising the value of the investment over time, unlike traditional venture
capitalists who want results and a return on their money quickly. However, this is a relatively
new type of investing. I found that many players in the space had just left their traditional
banking/corporate careers and, although they wanted to do something impactful, the majority
lacked the experience and know-how required to build a pan-African or emerging market
business. I was adamant that I wanted a business partner, not just someone I reported
financials to each quarter.
I also noticed that we were often ‘stuck in the middle’, being a for-profit enterprise with a
social mission. For venture philanthropists the social mission often takes precedence over the
financial mission. Most of the investors were concerned about impact first. The impact drivers
that they looked at were varied. Three typical metrics they used were: how many jobs were
created, income generation for franchises, and environmental impact. Ironically, sometimes
capital is too patient and can curtail efforts to make the business profitable as soon as
possible. In addition, I had not witnessed many exits among the venture philanthropy
community, which also had difficulty in dealing with profit distribution to shareholders. I was
thus a little reticent about opting for this sort of funding as it would limit the founders’
potential upside. At the other extreme, I was afraid that traditional venture capitalists would
put profitability ahead of impact and aim for a quick win and early exit.
Carbon Financing
I also investigated the possibility of financing through the relatively new carbon credit
markets. The emission of gases such as carbon dioxide and methane from manufacturing,
deforestation and energy generation is generally believed to be a source of climate change.
Nuru Energy, with its CO² reduction impacts, could be eligible for carbon emission credits
that had a monetary value and were tradable on the international market. To qualify for these
credits we needed to be approved by the United Nations “Clean Development Mechanism”
(CDM). The carbon credits could be earned through the replacement of CO²-producing
kerosene lamps with LED lighting technology (Exhibit 4).
In July 2010, I decided to approach some of the carbon credit brokers to see whether Nuru
Energy could make a financial deal. What I found was that while many carbon brokers were
open to discussion, only Bank of America Merrill Lynch (BAML) was willing to consider
advancing capital against non-guaranteed credits – a unique deal in the carbon space at the
time. BAML proposed a multi-million dollar deal whereby they would provide funding
upfront for the right to buy a certain volume of credits from our Eastern Africa operations.2
BAML was taking a risk by offering capital without a guarantee of credits in return – they
would have the right to buy the credits over a ten-year period at a pre-negotiated, market-
pegged price. They could then resell them at a higher price in the future. For BAML, the deal
could be both commercial and brand enhancing (as a socially motivated project).
Unfortunately, in the midst of negotiations with BAML, we discovered that the design of our
light would require some revision. According to newly adopted CDM technical specifications,
our lights did not meet the approved level of brightness. Although it was inconsistent with the
lighting needs that we had witnessed in the field – our brightness level was correct for our
users’ needs – if we wanted to be eligible for the credits, we had to redesign the light
accordingly, probably with an increase in the cost of the units. If we were unable or unwilling
to meet the specifications, the BAML deal would be a non-starter. In any case, this would be
an unusual deal and I was nervous about being reliant on a large investor such as BAML and
whether they would neglect the social mission of Nuru Energy.
2 Precise figures cannot be disclosed due to confidentiality agreement.
Selling Nuru Energy
I had been mulling over the idea of selling Nuru Energy outright for the last few months. It
wasn’t just a question of funding; I was not sure we had the right human capital in the
company to scale up properly. Moreover, I was tired after more than three years of intense
effort in building and leading Nuru Energy.
I decided to test the waters and see if there were any potential buyers for Nuru Energy. I
approached a company that I knew through Freeplay Energy, my former employer, to see if
they might be interested in acquiring Nuru. It was a global consumer product business that
had recently acquired an alternative energy business so they might be interested in making a
deal. The company’s response was positive – they believed that Nuru Energy was moving in a
promising direction in tackling the energy access problem. By November 2010, I had met
them several times and negotiations were progressing well, with a US$5 million valuation and
a lock-up period of two years during which I had to remain in the company. This would give
me a good pay-out and alleviate some of the responsibility on my shoulders.
Was it time to sell the business? A sale now would reduce the founders’ risk and ensure
resources for the scale up process. However, we would lose autonomy and control of the
strategic direction of the venture (which could potentially jeopardize its social mission).
Financing a Social Enterprise with Hybrid Goals

Interestingly, it was not the lack of options but rather the availability of multiple options that
made my decision difficult. On a personal level, I was growing weary of the constant
travelling and the uncertainty regarding Nuru Energy’s future. It had been an all-consuming
three years – an emotional roller coaster. I moved from Canada to the Netherlands in June
2010, in the hope that by basing Nuru Energy’s headquarters in Europe I would see more of
my family, but it hadn’t really panned out as I’d hoped. My energy levels were low and
finding the enthusiasm to motivate and re-energize the team was increasingly challenging.
Should I sell? It was appealing and could be a good time to exit and harvest the value that we
had created. The alternative was to pursue the BAML deal but, again, I was concerned about
compromising the social side of our vision. I didn’t want to hand over Nuru Energy if I wasn’t
100% certain its social mission would be continued. I could also accept funds from venture
philanthropist investors or build a syndicate of angel investors. Or I could try to continue a bit
longer on the current path, despite the personal challenges I was facing, and pursue new
donors or awards to finance operations for six to 12 months more.
That Was Then...This Is Now!

That was the situation at the end of November 2010. It is now the beginning of December and
I urgently need to make a decision by the end of the month, when our current funding will run
out. It is critical that I regain momentum, energy and focus. A new venture is charged by the
energy and commitment of its founders. Maybe it is time to step aside from my leading role
and allow someone else to recharge Nuru Energy?
Exhibit 1
The Co-founders of Nuru Energy (together with Sameer)
Simon Tremeer
Simon is a co-founder of Nuru Energy. He currently manages the manufacturing and electronics of all
Nuru products. Simon has over 15 years of experience in the Industrial Design and Manufacturing
field, having worked for the likes of Electrolux and Volkswagen. He later gained experience in the
renewable energy field while working for Freeplay Energy. Starting off as an industrial designer, he
designed some of the company’s most successful products, in the process winning the prestigious CES
award in Las Vegas. After successfully taking these projects from concept through to manufacturing,
he joined the operations department as Manufacturing Manager, overseeing the manufacture of all
products. Simon graduated cum laude from the Cape Town University of Technology, where he
obtained a BTech in Industrial Design.
Barry Whitmill
Barry is a co-founder of Nuru Energy. He currently manages Nuru’s industrial design team. He has 15
years of industrial design experience and has worked for numerous companies, taking products from
the concept stage right through to mass production. The products include Freeplay Weza foot-powered
generator, Lifelight developing world LED lantern, Crank Charger for the OLPC laptop, and the ML1
Mini Lantern, which won a CES Design Excellence Award.
Exhibit 2
Market Sizing Data (per country) and Current Coverage of Nuru Energy Solutions
Population Electrification Population GDP per capita GDP per

rate without rank (out of 180 capita
electricity countries) ($)
India 1,200,000,000 48% 580,000,000 143 1,017
Tanzania 45,000,000 11% 40,500,000 158 520
Kenya 40,000,000 14% 34,400,000 147 838
Uganda 32,000,000 9% 29,000,000 165 455
Rwanda 10,000,000 5% 9,500,000 163 465
Burundi 8,300,000 2% 8,150,000 180 138
© Copyright 2009 Nuru - All Rights Reserved
Exhibit 3
Awards
Award: World Business and Development Award

Organization: International Chamber of Commerce, 2010
Award: Sasakawa Prize

Organization: United National Environmental Programme, 2009-2010 Prize: $100,000
Award: Tulane University Business Plan Competition

Organization: Tulane University, 2010 Prize: $50,000
Award: Lighting Africa Development Marketplace Competition

Organization: World Bank, 2008, Prize: $199,275
Award: The Good Entrepreneur,

(Top 10 Ideas to Change the World)
Organization: CNBC and Allianz, 2009
Award: St. Andrews Prize for the Environment (runner-up)

Organization: University of St. Andrews, 2010, Prize: $25,000
Award: Grand Prize, People’s Choice Award, and Global Health Prize
(runner-up)
Organization: Global Social Entrepreneurship Competition (Foster School of Business,
University of Washington), 2010, $13,000
Award: Social Responsibility Prize (Grand Prize), Africa Prize

Organization: William James Foundation, 2010, Prize: $7,000 (and three in-kind prizes)
Award: Clean Energy Prize (semi-finalist)

Organization: Massachusetts Institute of Technology (M.I.T.), 2010
Exhibit 4
Carbon Credit Summary
Two billion people worldwide routinely purchase and burn kerosene for light, emitting over 260
million tons of CO2 annually – using up to 40% of their income while exposing themselves to harmful
fumes. Because current lighting alternatives are inadequate, access to electricity/light remains a
primary obstacle to improving health, education, and eradicating poverty. Nuru Energy aims to reduce
global CO2 emissions and light up rural households in Rwanda by distributing an innovative and
affordable lighting system to replace fuel-based lighting. The design and delivery model of our
modular, rechargeable, LED lights allows a greater reach and more immediate environmental impact
than other lighting solutions.
Nuru Energy sells the Nuru Light to replace kerosene. The Nuru Light is a very strong light that is
much brighter than kerosene. The Nuru light allows customers to:
x Have access to up to 28 hours of light (10 days of use) with a full recharge.
x Use individual lights in a variety of ways, including as a head or neck lamp, hung up, or on a table.
x Connect multiple lights together.
Customers bring their lights to local people to recharge their lights when the battery in the light is
dead. The customers pay 150 Rwandan francs for every recharge. With the Nuru Light, customers pay
1/20th the amount they pay for kerosene.
Nuru Energy Lighting Project and Carbon Credits

Emissions of gases such as carbon dioxide and methane – from manufacturing, deforestation, energy
generation and many other sources – are driving climate change.
Projects working to reduce these greenhouse gas emissions are eligible to receive carbon credits if
approved by a United Nations body known as the Clean Development Mechanism. Carbon credits
have a monetary value and are tradable on the international market.
By distributing over 300,000 lights over a period of two years, Nuru Energy will achieve carbon
dioxide emission reductions by replacing the use of kerosene. It is expected that the project will
generate average emission reductions of 35,000 tonnes of carbon dioxide equivalent per year. The
revenue from the carbon credits will help the project make their products affordable and accessible to
rural households in Rwanda.

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INS275

Social Entrepreneurship Initiative

Nuru Energy (A):

Financing a Social Enterprise

x Winner of the 2012 EFMD Case Writing Competition in the

Sameer Hajee, Co-Founder and CEO of Nuru Energy

Sameer Hajee – An MBA Graduate Turned Social Entrepreneur

Nuru Energy: Identifying a Neglected Societal Problem

Designing for the Base of the Pyramid

Once we had developed a promising technical design, we needed a convincing business

The Rwanda Pilot: Market-Based Business Model

We decided to set up a network of rural entrepreneurs, which created a sustainable livelihood

Nuru Energy acts as a “coordinator” between the microfinance

Nuru Light Kerosene

The Kenya Pilot: Donor Based Model

In our continuous search for funding, in 2009 we received a

India – Learning Good Lessons the Hard Way

Kenya – Scaling Up Too Fast

Financing Nuru Energy

Social Venture Capitalists/ Venture Philanthropy

2 Precise figures cannot be disclosed due to confidentiality agreement.

Selling Nuru Energy

Financing a Social Enterprise with Hybrid Goals

That Was Then...This Is Now!

Population Electrification Population GDP per capita GDP per

Award: World Business and Development Award

Award: Sasakawa Prize

Award: Tulane University Business Plan Competition

Award: Lighting Africa Development Marketplace Competition

Award: The Good Entrepreneur,

Award: St. Andrews Prize for the Environment (runner-up)

Award: Social Responsibility Prize (Grand Prize), Africa Prize

Award: Clean Energy Prize (semi-finalist)

Nuru Energy Lighting Project and Carbon Credits

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