July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

SAN MATEO, Calif. — Biolite founders Alec Drummond and Jonathan Cedar were working at a design firm in New York when they had the idea to combine a thermoelectric generator with a wood-burning stove.

The result: The CampStove, a portable, $130 stove that can boil a liter of water in about 4.5 minutes while recharging your iPhone — just by burning a handful of twigs. What’s more, its internal fan produces a very efficient reaction, so the fire is very hot and nearly smokeless.

Source: Dylan Tweney/VentureBeat

BioLite Campstoves turning sticks into electricity at Maker Faire Bay Area 2013. Photo: Dylan Tweney/VentureBeat

“We started to do the CampStove because it was a really good exercise in understanding how the technology worked,” said Drummond. It also encouraged them to build the device as compactly as possible.

But the company has bigger aims in mind than helping well-heeled backpackers go green. Its big project is the HomeStove, a larger stove meant for use in the developing world, and it is using sales of the CampStove to fuel (ha!) development and testing of the HomeStove.

“The company follows a model that we call ‘parallel innovation,’ where we have one technology that has near-term application in an accessible market recreation and emergency preparedness, and take the revenue to incubate longer-term markets in emerging companies,” said Jonathan Cedar, the company’s CEO.

It’s a model that, Cedar says, gives them the large-scale infrastructure and resources needed to bring their technology into the developing world effectively — something that nonprofits often lack.

Open fires: More lethal than malaria

According to BioLite, about half the human population — 3 billion people — cook their food over open fires, creating 1 billion metric tons of CO2 each year and killing 2 million people annually from smoke inhalation (twice as many as malaria). Of those 3 billion, about 1.3 billion lack access to electricity.

The HomeStove gives these people a way to cook more cleanly and efficiently: It consumes about half as much fuel as an open fire and produces only 5 percent as much smoke. Plus, by producing electricity, it can recharge a cellphone and small LED lights, helping these people get access to the Internet, communicate with others, or help their children stay up a few more hours at night so they can study for school.

Cedar says the company is currently market-testing the HomeStove in India and Ghana to find out what kind of prices and marketing are most effective. The goal is to make the HomeStove cost about the same as a feature phone in the local markets, or about $50; the fact that it can recharge those phones helps win the acceptance of men, even though it is a tool that will mostly be used by women for cooking. NIH and USAID projects are helping with the testing of the HomeStove.

BioLite is venture funded: It took a $1.8 million Series A investment led by Clay Christenson’s Disruptive Innovation Fund in Boston in 2011, with additional investments from angels and from Toniic, a network of “impact investors” in the Bay Area. It is based in Brooklyn, NY, and currently employs about 21 people.

Makers to world-changers

BioLite’s founders have deep roots in the maker community, which is one reason the company was exhibiting at the Maker Faire here.

“I think makers are really kind of our roots. Some of the first prototypes I built in TechShop here in Menlo Park,” Cedar said. He’d moved here temporarily from New York to learn about stove technology, for which U.C. Berkeley is apparently a real hotbed of innovation, and found that TechShop was a good place to work on his own stoves.

“We like to see science and technology applied to real-world problems, and I think that’s a lot of what makers are all about,” said Cedar. “Also, from a customer standpoint, the intersection of technology and outdoor exists pretty well here at Maker Faire.”

Both Drummond and Cedar were industrial designers, creating things for HP, Oxo, and Flip, before striking out on their own.

Cedar was always a tinkerer: “I was the kid who broke everything in my parents’ house,” he told me.

The initial idea for the stove came to them in 2006; by 2009 they were working fulltime on the project, and funding followed in 2011.

The company launched in June 2012 and has been profitable and cash-flow positive since then. Its CampStoves sell in REI and other mainstream outlets for $130 each, and the company has sold “tens of thousands” to date, Cedar said, predicting that they will have sold 100,000 units by the end of 2013.

Top photo: Alec Drummond (left) holds a cutaway model of BioLite’s HomeStove, while Jonathan Cedar holds a flaming CampStove, which is recharging the iPhone in his other hand. Photo credit: Dylan Tweney/VentureBeat.

This guest post is by Tinia Pina, the founder and CEO of social startup Re-Nuble.

First-mover advantage remains the driving force behind much of the technological innovation we enjoy today. Venture capitalists worldwide constantly search for new mobile products and consumer web apps to finance in their quest to tap new markets.

Under this model, public good and social benefit usually take a back seat to IPO considerations and profit potential. It’s a model that works — and works very well — bringing us the likes of Angry Birds, Instagram, and countless other mobile technologies that continue to take over the world and generate handsome profits for their backers. 

I must confess that I’m shamelessly addicted to Angry Birds and want more mobile apps like it. But like so many game-changing technologies, it hasn’t fundamentally altered my relationship with the world.

From Rovio’s financing to its development to the countless hours I’ve personally spent on the app, there exist numerous opportunities in which we could have invested resources to change not only “the game” but also the entire planet.

Green technology implemented in resource efficiency and sustainability business models are prime examples of worthwhile endeavors whose profit potential attracts investors but whose track records impede actual investment.

 Just to put this in perspective:

• Total U.S. VC investments in green clean tech reached $6.6 billion in 2011
• In that same year, MoneyTree reported that VCs poured $28.4 billion into 3,673 internet sector deals

In the relative absence of a quick adoption rate, the government must step in to support green or clean tech.  However, despite numerous successes, a few high profile failures (such as Solyndra) are enough to reinforce the belief that avian iPhone apps should take precedence over saving the planet — at least as far as investment goes.

But it doesn’t have to be like that.

Enter social entrepreneurship

Social entrepreneurship is an emerging trend that marries traditional capitalist principles with more altruistic notions of societal good.

The idea is to do real good in the world, while continuing to generate profits.

According to his landmark book, How to Change the World: Social Entrepreneurs and the Power of New Ideas, David Bornstein defines social entrepreneurs as those who inspire positive, meaningful change without compromising the basic tenets of good business.

Pioneers in the field enjoy first-mover advantages just like their counterparts in the consumer tech sector. But they don’t view new opportunities exclusively through the lens of technological innovation. In fact, many social entrepreneurs actually embrace proven technologies that have already existed for years. The advantage comes from how they choose to apply and scale established tools.  In other words, the scope and reach are unprecedented, not the actual technologies themselves.

From microfinance to organic recycling to sustainable farming, social entrepreneurs continue to expose the false choice between corporate profits and good works, concepts that share equal footing once you begin internalizing the benefits (rather than externalizing the costs).

But if one no longer has to sacrifice profitability for societal good:

• Why hasn’t the greenclean tech movement taken over Silicon Valley and Wall Street?
• Why do we continue to rely on government intervention to develop solutions that benefit investors and the planet alike?
• Why do we accept low success rates for consumer tech start-ups, but continue to hold green tech start-ups to a different standard in which a few notable failures can tarnish the entire industry?

As a social entrepreneur, I have many more questions than answers.

Maybe we simply need more high profile successes to attract VC interest.  Or perhaps another Hurricane Sandy will help highlight the consequences of continued inaction.

What I do know is that the transition to a more sustainable global economy is inevitable.  And with so many separate environmental and social challenges to tackle, there are an infinite number of green clean tech first-mover opportunities from which investors can choose.

Tinia Pina is the founder and CEO of Re-Nuble, an organics-to-energy sustainability social enterprise.  Tinia founded Re-Nuble with a mission to “Redefine Waste” within local, urban communities.  She frequently tweets as @viare-nuble.

Photo credit: NASA

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Leila Janah, cofounder of Samasource. (Photo:Ved Chirayath)

Muhammed Yunus, a 2006 Nobel Peace Prize winner and founder of Grameen Bank, sparked a movement with the simple question: “If you are a socially conscious person, why don’t you run your business in a way that will help achieve social objectives?”

Today’s young tech entrepreneurs have inherited Yunus’ vision, and are changing the way we do business. Their space, “social business,” is nothing new, but these under-35s are attempting to alleviate global poverty, climate change, and even armed conflict through commercial enterprise.

There is no clear-cut definition, but most social entrepreneurs would agree that their overarching goal is to use business and business process to drive social or environmental impact.

“There is a growing group in Silicon Valley that believes that social business and technology can change the world,” said Leila Janah. Janah, at 29 years old, is the founder of Samasource, which provides outsourced computer work to women and youth in the poorest pockets of the world, including India, Kenya, and Pakistan.

Impact investors, once a niche group, say they are now inundated by opportunities in this space.

“I was doing this in the mid to late 90s and I felt very lonely in that pursuit. There wasn’t even a language for social or mission investment,” recalled Stephen DeBerry, founder of Bronze Investments and partner at Kapor Capital. “But for young entrepreneurs today, it’s considered the right thing to do and is viewed as being cool.”

To illustrate the “straightforward business proposition,” DeBerry delves into a discussion about his firms’ energy efficiency strategy. In New York, schools are literally dripping mercury on children, he explains, with hazardous florescent lights from the 70s and 80s. “We pay to upgrade your lighting and make the money back over time as you realize the savings on your energy bill,” said DeBerry. Someone has to change these light bulbs, which in itself is a job creator, and there is no shortage of buildings. “We could do this for a long time,” he said.

Nick Flores is a recent Stanford Graduate School of Business alumni who sources early-stage social businesses for the Investors’ Circle, a network of angel investors and venture capitalists that uses private capital to promote a transition to a sustainable economy.

Flores, the Director of Investor and Entrepreneur Services, said there should ideally be a “yin and yang” between social and financial returns. It is Flores’ job to locate small businesses that are capable of making a real impact in the world, and prepare them for a pitch at the firms’ biannual fairs. Investors’ Circle’s greatest success to date? “Zipcar reduces carbon emissions and has a really scalable business model,” he said.

After a series of successful acquisitions by Amazon and Motorola, Danny Shader, a serial entrepreneur, approached DeBerry with an idea for a payment system for virtual goods. DeBerry suggested that Shader focus on an under-served market, America’s low-income “unbanked” population. One in four households don’t use credit cards, and are locked out of electronic commerce as a result.

Shader founded PayNearMe, a Mountain View-based startup, in 2009. Although the company is profitable, it has a social mission at its core: enabling millions of people to pay for online goods and services with cash.

“I’d like to take some credit for mentoring him, but not all the credit,” said DeBerry of Shader. “Danny is a smart guy, and I pointed him in the right direction. He saw there was a huge market there.”

Zipcar and PayNearMe, which DeBerry terms “profit-aligned social businesses,” have caught the attention of the tech community.

“There was a great hubris in Silicon Valley to create huge, billion dollar companies, but that’s changing,” said Janah. The Harvard-educated entrepreneur owes the success of her nonprofit to traditional tech companies like LinkedIn and Intuit. These clients immediately saw the value in Samasource: They need people to sort through mountains of data, and there are bright, young, employed Kenyans who are more than capable of doing the work. “It’s really a no-brainer,” she said.

On the other end of the spectrum, social investors are taking on some of the world’s most complex problems. One example is The Portland Trust, a non-profit with a mission to promote peace between Israelis and Palestinians through economic development and fostering entrepreneurship. The Trust is in the process of establishing a Social Investment Task Force to reduce the social gaps in Israel through the private sector.

“What we’re seeing now is a movement of both investors and entrepreneurs to the massive spectrum of opportunity in between the charitable NGO’s and purely for-profit companies that solely care about their bottom line,” explained Ophir Samson, project manager at the Portland Trust.

Samson, an exceptionally articulate 20-something, said social investment is not fully developed but it is “getting there and is growing extremely fast. There’s a lot of money and talent from all sides of the market going into this.”

The movement has had its ups and downs; perhaps the most prevailing problem is that there is no unit to measure impact. Generally speaking, it also costs more to do the right thing. Social investment is not about making fast cash. It is often a slow-burning, high-risk process that will not make entrepreneurs millions overnight.

With 50,000 visitors to its website per day (higher than any other nonprofit with the exception of Wikipedia), Kiva is often cited as the premier success story in this space. Kiva’s President, Premel Shah, recently recognized as a young global leader by the World Economic Forum, said social investment involved “being more cognizant of how you consume and how you invest.”

Kiva provides loans to institutions around the world, effectively enabling ordinary people to become social investors. Every four days, Kiva raises $1 million. Shah likes to describe Kiva as “social investment meets Match.com.”

Kiva offers loans to institutions in far afield countries, including Palestine and Yemen, but also provides funding for small businesses in U.S. cities like Oakland. “These are places where there’s not a lot of commercial investment because the risk profile is too high. This is exactly where a social investor can step in and be a little bit more patient with their capital,” Shah explained.

One such investor is Reid Hoffman, co-founder of LinkedIn, who will soon announce plans to invest $1 million in small businesses through Kiva’s lending platform. “Kiva’s innovative use of technology as a tool for crowd funding empowers everyday people, companies and major lenders to be social investors,” said Hoffman.

Yunus had the seeds of the idea for the Grameen Bank in the 70s, but it’s our young generation, then in diapers, that is realizing the full potential of his vision. Thanks to their efforts, social enterprise is flourishing, and even the most traditional investors and entrepreneurs are on board.

As VentureBeat’s own Ciara Byrne put it: “What’s cooler than a million dollars? Changing a million lives.”

Top photo by Ved Chirayath

Christina Farr is a Bay Area-based writer with a graduate degree from the Stanford School of Journalism. She covers entrepreneurship, technology, and investment trends. Christina works for, but does not speak for, Eastwick, an agency in Silicon Valley.

This series is brought to you by Saab. At Saab, we believe in independent thinking. It’s in everything we do. Learn more here.

In just the last few years, a vibrant community of socially-conscious startups has sprung up to do good for humanity while turning a profit for investors. As you can imagine, this trend has bred some creative approaches to world problems.

Recent startups of this kind have tackled malaria by providing affordable bed nets infused with insecticide, reinforced water sanitation by installing chlorine dispensers near wells and springs, promoted clean power by ramping up solar and biomass operations, and provided invaluable Internet access to emerging markets. Even though the bulk of these innovations serve impoverished populations, they prove that it’s possible to build self-sustaining businesses where people previously thought it impossible.

Bringing new technologies to remote and under-resourced regions is no easy task. Products need to be finely contoured to suit specific requirements. This is where thinking creatively, and even counter-intuitively comes in. Social entrepreneurs can’t just go with the flow of the market. They must harness market forces to accomplish their particular missions.

Take Silicon Valley company Driptech as a prime example. With a proprietary manufacturing process, this company builds affordable and expandable drip irrigation systems for small plot farmers around the world. Drip irrigation consists of inexpensive tubing that delivers targeted drops of water where crops are planted, using minimal energy for pumping. It eliminates the need for wasteful flood irrigation in regions where fresh water is scarce, and is actually proven to increase crop yields where it’s deployed. Simple but revolutionary.

Peter Frykman, the Stanford-trained mechanical engineer behind Driptech, knew there had to be a more efficient way to channel water to crops growing on small plots in the developing world where fresh water is increasingly scarce and precious. But his brainchild was not just the system of interconnected tubes. He realized that affordability had to start with the manufacturing process.

Driptech’s real achievement is automating the production of its irrigation systems and reducing the number of parts involved to make installation even easier. This production process makes Driptech’s product two to five times less expensive and more reliable than other alternatives. Rigorously tested from the start, the startup’s technology has saved hundreds of farmers time, energy and money, allowing them to grow crops and bring in money even during the dry seasons.

Social entrepreneurship is a break from the norm. It requires a detour from standard market forces driving hard toward profitability at all costs. And it fosters a higher consciousness that business can deployed strategically to serve the common good.

Under this broad umbrella, companies like Driptech are breaking new ground by examining issues of true affordability, community dynamics and situational demand to supply much-needed goods and services. Just like other Silicon Valley startups struggling to grow, they take investments on the promise that they will deliver returns — only these returns include a healthier, happier planet too.

Now that’s true independent thinking. And good karma to boot.