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San Francisco-based startup Fenix International, which makes a battery product that can charge cell phones and run lights in off-the-grid regions, has scored its largest deal to date with Vodafone in Tanzania. The telecom giant will sell Fenix’s ReadySet charger and its accompanying charging accessories in Tanzania, market the products via billboards and television spots in the region, and also create a fund to make loans to women entrepreneurs so they can
buy the product.
The deal has nothing to do with charity. Vodafone sees a major opportunity in getting more electricity — in whatever form — to its customers in areas like Tanzania that have a large percentage of the population living off the grid. More electricity means more cell phone use. There are 46 million people in Tanzania and only 14 percent of them have access to grid power — the rest of them use a combination of car batteries and diesel generators when they need access to power. Vodafone has about 10 million subscribers in Tanzania.
Fenix’s ReadySet battery can be sold with a solar panel charger as well as a bicycle charger (riding the bike in stationary mode charges the battery), and the simple design of the battery is what makes it so accessible to customers. Users can charge cell phones and plug in lights using basic connectors like USB and car lighter ports. (Check out Kevin Tofel’s review of the ReadySet).
The device costs around $200, which is a relatively high price for that area. But the people who will buy the ReadySets are mostly entrepreneurs in villages that will use the battery to sell cell phone charging services and charge their shops after it gets dark. Entrepreneurs can make $40 to $50 per month from offering cell phone charging services.
Vodafone is already working with these types of entrepreneurs on other services. Vodafone created a mobile payment system called M-Pesa, where people can exchange cell phones minutes for goods and services. There are 4.5 million people in Tanzania using the M-Pesa service, and there are 40,000 agents that operate as M-Pesa entrepreneurs (like human ATMs with cell phone minutes).
It’s these 40,000 M-Pesa entrepreneurs that Vodafone thinks will be particularly attracted to ReadySets. With reliable off-grid power, these local business people can keep their phones charged longer — and provide more mobile banking services — and also they can start selling cell phone charging as well. Vodafone said that in a pilot in Tanzania with the ReadySets, it saw 14 percent more average revenue per user across the M-Pesa system, because more people’s phones were charged to receive and give money.
Scoring a deal with Vodafone is a game changer for Fenix. Vodafone has some 400 million subscribers globally, and 100 million of those are off-grid customers. Globally 1.3 billion people live off-grid, and 600 million of those are cell phone subscribers. Fenix also is working with MTN, the largest telco in Africa with 180 million subscribers.