[Startup Interview] Stella Sigana, Executive Director, Alternative Waste Technologies, Kenya
A beneficiary of the Tony Elumelu Entrepreneurship Program, Alternative Waste Technologies, Kenya has, in the two years since its inception, made significant leaps in energy production and environmental conservation.
Africa Business Communities interviews its Executive Director, Stella Sigana:
What does Alternative Waste Technologies do?
Alternative Waste Technologies (AWT) produces fuel briquettes through conversion of organic and charcoal wastes from slum settlements and markets therefore enhancing environmental cleanliness through a combination of briquetting technology, entrepreneurship and a distinctive business model. Established in 2015 with six direct employees and 50 indirect employees, we have successfully recycled at least 600 Tons of waste into fuel briquettes for cooking. We pride ourselves in producing premium charcoal briquettes under the trade name Inferno Charcoal Briquettes which have zero smoke, no odor, remarkable consistency and burning efficiency, high calorific value and environmentally sustainable. Currently we have developed a business model that has empowered 30 women entrepreneurs in slum settlements to build businesses by selling our products directly to communities, thereby increasing their household income and wellbeing.
Where are your offices located?
We currently located in Kenya, Kajiado County with its headquarter office in Nairobi County. We have recently expanded to Western Kenya where we’re setting up another regional production plant.
Why was Alternative Waste Technologies set up?
AWT was founded in the year 2015 following a three-year market research and surveying the briquetting technology which began in the year 2012. I founded the idea based on working experience and interaction with informal settlements specifically Kibera community which is considered to be the largest slum settlement in Africa and one of the largest globally with a population of 250,000 people on a 2.5 square kilometer piece of land. The community predominantly uses firewood and charcoal for cooking with a few households embracing LPG gas. The business is registered as a Limited Liability company under the Kenya Law with two partners each holding 50% share of the company. We are basically a social enterprise therefore 20% of our profits are given back to community development efforts, supporting SMEs in growth and strategy development. The other 80% goes to operations and business growth.
How is the company funded?
AWT has engaged three levels of funding to enable the company develop a pro-type and do a piloting for the project as well as early customer traction. We have so far obtained funding by bootstrapping about $5, 000 into the startup. Family and friends have similarly contributed about $3,000 into the enterprise. Courtesy of being a beneficiary of the Tony Elumelu Entrepreneurship Program in 2016, we received a seed capital of $5,000 which went towards development of operational systems and capital expenses. Other funding support for the project comes from profits generated by business. Once the AWT shows definite customer traction and retention, we hope to explore early stage funding and funding for expansion strategies into the counties, regional and international markets.
What are the company’s Unique Selling Points?
AWT’s USPs are anchored on four core values. First, bio-fuel briquettes are sustainable and easily accessible since they are made from refined and densified leftover agri & forest residues. They are eco friendly renewable fuel products and also a potential replacement to conventional fossil fuels. Second, they have improved performance in use since they have remarkable consistency and burning eefficiency as well as have a high calorific value.
Third, they are convenient to use as they are highly safe, non inflammable with no risk of explosion during transport and use.
Fourth, they have a cost reduction implication compared to charcoal and firewood with US$0.04 cooking a traditional meal of maize and beans for a standard household of 5 people which is nine times cheaper than cooking the same meal with charcoal (US$0.3) and 15 times cheaper than cooking with kerosene (US$0.6), meaning that a household can reallocate finances to improving the outcome of the family both in health and socially.
How has the Kenyan market responded to Alternative Waste Technologies?
The demand for energy in East Africa is increasing for households, businesses and industry. Increasing populations, aggressive deforestation, expanding economies and a lack of regulation have led to increasing fuel prices and shortages, which often hits hardest the households and businesses most in need. Despite the ever increasing costs of kerosene, it is often used for lighting (52%) while biomass is widely used for cooking (60%). The most popular fuel types in terms of their various uses are; kerosene (80%) followed by charcoal (60%), fuel wood (55%), electricity (37%) and LPG (21%). Briquettes have high specific density (1200 Kg/m3) and bulk density (800 Kg/m3) compared to 60-180 Kg/m3 of loose biomass. Compared to fire wood or loose biomass, briquettes give much higher boiler efficiency because of low moisture and higher density. The efficiency and cost effectiveness of briquettes make them appealing to customers.
Who are your clients?
Biomass fuels are used mainly for institutional, commercial, and industrial applications; such as cooking in hotels and restaurants, space heating for poultry farmers, and heating applications in industrial boilers. Our current market has been educational institutions with statistics showing that they are pivotal consumers of biomass fuels since they serve large populations at any give one time with at-least 3 meals a day. Kenya currently has over 79,641 educational institutions as at 2014 serving a population of 16 million students. This includes 40,219 pre-primary schools serving a population of 3 million students, 20,460 primary schools with a population of 10 million students, 8,047 secondary schools with a population of 2.3 million students, 407 teacher training colleges with a population of 56,110 students, technical and vocational training colleges at 755 with a population of 148,142 students and 53 universities with an estimate population of 450,000 students. It is estimated that approximately that 75% of these educational institutions consume about 270 tons each of wood fuel per year; a staggering 16.1 million tons annually.
What are the goals of Alternative Waste Technologies, regionally and internationally?
We endeavor to continue building and maintaining partnerships with national, regional and international partners by aligning our growth strategic plans along the already established and published policy frameworks of the national and regional/ international governments and also involving these three levels of governance during benchmarking and impact assessment activities, community mobilizations for acceptance and ownership of the affordable and sustainable energy solutions as well as collaborating with them to actualize our corporate social responsibilities for the benefit of the communities where will operate. Considering that not only will we target profits making but also empowering communities by providing jobs, capacity building and enhancing waste management, we strive to offer an added value approach through the conversion of the public health concern posed by the wastes to sustainable opportunities of job creation, environmental sanitation, conservation and capacity building. We aspire to supply clean energy in sub-Saharan Africa with exports to Arabian and Scandinavian countries.
What does Alternative Waste Technologies need to flourish?
Alternative Waste Technologies aspires to grow and prosper as per our 10 year growth strategy of being a USD1billion company in sub–Saharan Africa. As a startup company, we desire to grow through establishment of working efficient seamless systems that can be operated even by low cadre staff. The compay desisres to upgrade and semi-automate its production equipments to further increase the production capacity and efficiency. AWT needs to have an Information Management System (to capture data on waste collection quantities, recycling, production quantities and marketing, client portfolios, impact stories and numbers, complaints and feedback mechanisms), marketing expansion strategies, branding and corporate communication competencies, financial management systems, fundraising strategies, risk assessments from the local to international levels of engagement, succession and exit strategies for the company to empower locals in developing community enterprises are also desired.
What is the latest news from Alternative Waste Technologies?
We have just adopted a Care Group Business model aimed at reaching households in informal settlements to promote behavioural change through adoption of charcoal briquettes for cooking, therefore preventing premature deaths of infants and children under 5 years as well as mothers through exposure to smoke from open fires.
Being a cascaded marketing strategy, the Coordinator (paid staff) is responsible for 3–6 Supervisors. Each Supervisor (paid staff) is responsible for 4–6 Promoters. Each Promoter (paid staff) supports up to 9 Care Groups generally reaching about 500 to 1,200 women. Each Care Group has 10–15 Care Group Volunteers that are elected by Neighbor Group members. Each Care Group Volunteer promotes briquette adoption with 10–15 Neighbor Women and their families, known as a Neighbor Group. (There is a maximum of 15 Neighbor Women in each Neighbor Group).
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