Growing up in hurricane-prone Florida, I experienced a lot of blackouts in my childhood. I’d do homework by candlelight and then my sister and I would make animal silhouettes on the wall until we grew bored. Most blackouts would last a few hours and some a few days but the promise of renewed electricity and the accompanying hum of the TV, computer, and cell phone rings always kept us from complaining too much.
Now, imagine those semi-disgruntled nights from that one time you lost power and realize that not everyone has the promise of restored electricity, mostly because they never had electricity to begin with.
As SunFunder explains, hundreds of thousands of people in Africa don’t live off the light of a charming scented candle in the occasional blackout. Instead, they live entirely by the light of a kerosene lamp everyday of the year, “an expensive and dangerous source of light.” According to the site, kerosene lamps can cost a family as much as 20% of their family income, money that could otherwise be spent on food, clothes, or health care. In addition, the constant exposure to kerosene smoke and chemicals “contributes to more deaths globally than malaria.” This week’s case study covers SunFunder, a crowdfunding platform devoted entirely to eradicating energy poverty and kerosene poisoning around the world.
Unfortunately for us, SF’s page lacks a “History” section with information about its founding, but we’ve managed to piece some information together. SF began in 2012 and has quickly gained recognition as a promising startup in publications like The Huffington Post and Bloomberg. SF began with a successful fully-funded $4000 campaign for solar lighting and cell phone charging in the Philippines with the contributions of just 62 people. Since then, SF’s project base has expanded to include 3 other projects, 2 of which are fully funded and the remaining one 86% funded. According to a ticker at the top of the site, in less than a year SF has managed to empower 4,405 people (“and counting…”) through its solar crowdfunding platform.
For such a relatively new startup, SF has had remarkable success – crowdfunding roughly $46,000 to fund solar projects in the Philippines, Zambia, and Tanzania. SF successfully makes its mark because it works in a niche market – only funding solar projects (instead of general green projects) with an emphasis on solving energy poverty worldwide (instead of in a specific location like competitor Solar Mosaic). SF’s mission and platform are so specific and clear that it’s more likely to attract an enthusiastic and passionate set of donors than a more varied platform.
SF’s biggest strength is using a regulatory setback to encourage its own growth. As the website explains, SF is not able to provide interest to investors because of regulatory restrictions. Instead, SF transforms this interest into Impact Point (100 points = US$1) to use in further project investments. We loved SF’s creative problem-solving, using a regulatory drawback to promote its own virality and growth.
Room to Grow
Along with Bay Area company Solar Mosaic, SF is leading the pack of solar crowdfunding platforms with a lot of potential. In 2013, we’d like to see more growth (more projects to fund) and more transparency. How are the projects picked? By whom? Is there a formal application process? How much of the funding does SF receive? We think potential donors would feel more comfortable contributing if they had as many answers as possible.
Why They Are Successful
SF has a fantastically responsive website that breaks down the impact for each individual investor – how many people they impacted, how much solar energy they provided, etc. The details make the impact more real for the investor, encouraging them to continue investing and watch their numbers jump.
How to Engage
As a crowdfunder, start thinking of how you can make clients and customers feel as good as they do when they’re checking their latest impact stats. Maybe think about it as you help SunFunder’s latest solar project, giving solar to 1200 families in Zambia.