Innovating the Electric Bill
Angaza made solar devices, then pivoted into a financial solution that could bring solar energy to untapped markets around the world.
The Tech Awards, presented by Applied Materials, will be held Nov. 17, 2016. This year, The Tech Awards will celebrate a retrospective of the program’s history by honoring seven past laureates who have made an enormous difference in the world. For more information visit: www.thetech.org/tech-awards-presented-applied-materials.
This story is about bringing light to the world. So it’s only fitting there was a lightbulb moment that changed everything.
For Lesley Marincola, it began with a course called Extreme Affordability while she attended Stanford. Marincola worked on a project to bring solar lanterns to people living without electricity in the developing world. But she was transfixed by a problem: How do people who have little disposable income afford the up-front cost to buy these products?
A few years later, Marincola was still wrestling with that conundrum as the CEO of the solar lighting startup Angaza. The price barrier for even a simple lantern remained out of reach for too many people in places like Kenya. Without solar power or electricity, people typically rely on expensive, toxic lighting solutions like kerosene, which has detrimental effects on both their health and the environment.
This is where the lightbulb — OK, solar device — clicked on.
The problem wasn’t solar technology, Marincola thought, but rather a need for innovation in financial technology. So, she and her team developed a revolutionary pay-as-you-go platform. By embedding a small metering and remote monitoring circuit in each solar device, Angaza allows consumers to pay for a variety of products through affordable micro-payments spread over time.
Think of it like buying airtime on a cellphone.
“I’ve traveled through off-grid areas much of my life, and I’ve always seen energy as the first problem to solve if you want to break the cycle of poverty,” said Marincola, 30. “That just opens up so many doors from income-generation to educational opportunities to basic good health. But first, we needed to find a way to make these life-changing products radically affordable to anyone, anywhere in the world.”
Angaza, a Tech Awards laureate in 2012, is being honored again this year as part of a retrospective gala on Nov. 17, 2016, celebrating the program’s first 15 years. Angaza will be recognized with the Katherine M. Swanson Young Innovator Award for the impact it has had since first being named a laureate. It will receive a $50,000 prize. Learn more about all of this year’s laureates.
Angaza — which means “illuminate” in Swahili — has put solar energy within reach of thousands of off-grid families in 15 developing countries. They simply wouldn’t have the means to afford solar power without Angaza. And there’s room to grow. An estimated 1.2 billion people around the globe lack access to electricity grids.
Just $2 in energy costs can represent 20 percent of a family’s weekly income. So even the $15 cost for a small solar lamp is more than they can afford.
But by using pay-as-you-go technology, Angaza works with manufacturers and distributors so that lamps and other solar products are available for a minimal down payment. Families then can make periodic payments in small increments. Maybe that small lamp is paid off over a 10-week period. Larger solar systems can have plans that stretch longer. If a payment is not made — and consumers typically use their cellphones to do that — the product will deactivate. But once it’s paid off, the product is “unlocked” and belongs to the consumer. The dollars saved can make a huge difference in a family’s standard of living, Marincola said.
“It’s just a complete no-brainer,” she added. “There’s an actual end date with no more never-ending payments of kerosene. It’s just free energy from the sun. So it’s a win-win.”
Lindsay Caldwell, the director of East Africa Operations for Angaza, said Marincola is a “genius” when it comes to looking at problems in a new way. “The narrative that we always talk about goes back to that class at Stanford,” Caldwell said. “She had the forethought to say, ‘I’m not going to have an impact just making another solar product. But I can have an impact by figuring out a way to help people finance those products.’ ”
“It was absolute jubilation the first time we won The Tech Awards. It was just a great piece of validation and really helped propel the business off the ground. Looking back, we owe a lot to being named as a laureate. It really started us on the path. Four years later, we’ve come a long way. It has been an awesome journey.”
— Lesley Marincola, CEO of Angaza
Since being named a Tech Awards laureate in 2012, Angaza has grown from three co-founders and several pilot projects to a thriving business with 20 employees and more than 30 partners who are impacting the lives of hundreds of thousands of off-grid consumers, and are on track to impact the lives of over 1 million people by the end of 2016.
Not only is it adding manufacturing and distribution partners, Angaza also has branched out into new product lines like water-pump technology and clean-energy cookstoves. The company’s technology now is being used throughout Africa as well as Asia and Latin America. And it’s helping people build credit histories, open bank accounts and even start their own small businesses.
“It gets super exciting when you think about putting all of these low-income consumers on the map,” Marincola added. “We have big plans.”
At a Glance: Angaza
Year of Previous Award: 2012
Regions of Impact: Kenya
Funding Sources: Last year, Angaza closed a Series A funding round of $4 million, adding to its seed round of $1.5 million in 2013.
Problem: The large, upfront cost of solar energy can lock out off-grid customers in developing countries, who then rely on unhealthy, polluting sources of energy such as kerosene.
Solution: Pay-As-You-Go technology enables businesses to extend flexible, affordable payment plans for solar and other energy-related products to people in developing nations who don’t have access to grid electricity.