To Greenlight Planet, the sun is definitely the king of the universe. With its award winning product, Sun King, Greenlight Planet has successfully launched solar lanterns in deep rural markets in Orissa and Bihar. It has over one million customers using SunKing every day and has established over 800 micro-franchises. Priced at about Rs. 850, the product offers a very strong economic value proposition for its consumers. Built on this value proposition, Greenlight Planet has demonstrated an impressive array of positive commercial and social outcomes. Leading this firm are three engineers from the University of Illinois, Urbana Champaign – Patrick Walsh, Mayank Sekhsaria and Anish Thakkar. They have ambitious plans for the future, but the road traversed so far has some interesting contours.
“A recent study conducted by Planete d’ Entrepreneurs, a French social impact assessment organisation, indicates that Greenlight Planet’s customers have tangible savings from lowered kerosene consumption and increased revenue due to improved productivity after sunset.”
Sown in oil
The seeds of Sun King took root in non-edible oil seeds. It started in 2005 when Walsh spent three months working on a rural electrification project in Orissa as part of ‘Engineers Without Borders‘, a group that connects student organisations in the U.S. with communities in the developing world. Several villages in Orissa are ‘off-grid’ and villagers use diesel engines for electricity. While the engines are cheap, diesel is an expensive fuel.
Fortunately, the land was dotted with oil seed bearing trees. The ‘Engineers Without Borders’ team created processes to extract bio-diesel from the seeds to run the engine. But when the team went back to the village a year and a half later, they saw that the villagers had connected light bulbs to each engine. This set-off the proverbial light bulb – the villagers primarily needed electricity to provide light. “Electricity was merely a means to a brighter end,” says Sekhsaria, co-founder.
This experiment established a need that was very clear. Unfortunately, the bio-diesel based business model was not scalable. This gave birth to the first big challenge the team faced – though the market needed affordable lighting, how could they develop such a product in a profitable manner?
The king’s prototype
Back to the drawing board, the team developed the first version of Sun King. Walsh led the product development at the Technology Entrepreneur Center at the University of Illinois, while Sekhsaria and Thakkar developed a business plan for the venture. The basics around the product and the market were clear since the early stages of the venture – the product was technically sound, the market was rural off-grid communities in India and the price was below Rs. 1,000.
Founders: Patrick Walsh, Mayank Sekhsaria and Anish Thakkar
While the plan was in place, funds were critical for implementation. In the middle of 2008, in an almost inspired move, Thakkar pitched his idea to Dr. Prabhakant Sinha, the co-founder of ZS Associates – his employer at that time. The pitch was successful and Greenlight Planet obtained initial funds from a group of investors led by Dr. Sinha. Simultaneously, the team raised additional capital from winning several venture competitions at business schools.
With funds trickling in and the design in place, Walsh headed to the Shenzhen province in China to set up a manufacturing facility, while Sekhsaria and Thakkar moved to India to set up the distribution channel. The team then decided to target rural areas in Bihar and Orissa, which provided the perfect customer base for the product. The next big challenge was to set up the distribution channel to reach these prospective customers.
The company initially experimented with third party distributors such as SIM card agents and non-governmental organisation networks. These agents had a rural foot print, but it was not deep enough nor did they show urgency that a startup would need. This convinced Greenlight Plant to set up its own distribution channel, Direct to Village (DTV).
DTV comprises of a network of rural entrepreneurs, Saathis, seeking to earn additional income. Saathis could be LIC agents, school teachers or farmers with some basic education. Saathis were trained about the product and they offer considerable credibility to local customers. They also provide post-sales service. From a Saathi’s perspective, he /she could earn an incremental income of up to Rs.3,000 per month, which in many cases was about 40 per cent increase in their monthly income. In addition, over time, Saathis have developed an enhanced social standing in the village. “Selling in the rural context is all about proximity and permanence,” says Sekhsaria.
Over the last three years, Greenlight Planet has shown impressive growth in both financial and social terms. In addition to a strong presence in Bihar and Orissa, the company has received many awards from international organisations like IFC and World Bank for its product innovation and innovative distribution system. In 2012, Greenlight Planet is looking to scale up its operations to many more states in India.
A recent study conducted by Planete d’ Entrepreneurs, a French social impact assessment organisation, indicates that Greenlight Planet’s customers have tangible savings from lowered kerosene consumption and increased revenue due to improved productivity after sunset. All these, coupled with the increased earning ability for its Saathis, strongly certify Greenlight Planet’s ability to create wealth in rural areas.
Even as the company focuses on India, it also has an eye set on Africa as it is an attractive market for solar products. The cost of kerosene is very high in many African nations as consumers do not enjoy government subsidies that consumers in India enjoy. The cost of one Sun King is about three to four months supply of kerosene in Africa, while it is about seven to eight months in India. Currently, Greenlight Planet has partnered with several local partners to reach end-consumers in Africa. The growth in the African market has been rapid with its product sales happening in as many as 13 African countries. The company has ambitious plans to expand the depth of its presence in several of these countries.
On the back of a successful start, a well-developed distribution strategy and multi-national expansion, Greenlight Planet’s founders find themselves amidst a happy identity crisis. Is it a solar product company or a rural outreach company? Is it a social venture or a consumer products venture? The founders have yet to make up their minds on seemingly existential, yet largely academic, questions. Currently, they are burning the midnight solar lamps on scaling and portfolio expansion. The company has recently added a new variant of Sun King called Sun King Pro to its portfolio..In addition to being a much brighter light, the Sun King Pro allows consumers to charge their cell phones and other micro-power products, a very important utility in villages that do not have grid connected electricity.
While Sun King Pro has shown good traction, there is a lot more work to be done. There are more products to be added, more areas to be explored, more partners to work with and more impact to be delivered. The team is certainly very optimistic and they are approaching these challenges with the same enthusiasm and meticulous planning, which has been fundamental to its success so far.
Concept in Brief
Having seen how villagers relied heavily on diesel engines in many parts of Orissa and Bihar, Greenlight Planet’s founders realised that villagers primarily needed electricity to provide light. With this in mind, the company went on to design Sun King, affordable solar lanterns. . It has over one million customers using Sun King every day and has established over 800 micro-franchises. Priced at about Rs.850, the product offers a very strong economic value proposition for its consumers. Over the last three years, Greenlight Planet has shown impressive growth in both financial and social terms. The growth in the African market has been rapid with its product sales happening in as many as 13 African countries.