Quetsol is a company that uses solar energy to improve the quality of life of poor communities living off the electrical grid.

Juan Rodriguez was a rising star at Procter & Gamble in Central America when he started going through what he calls a “deep personal transformation," and founded Quetsol with his childhood friend Manuel Aguilar. In their native Guatemala, poverty is widespread: Close to 20% of the population lives without electricity, relying primarily on candles for light.

After spending a year visiting close to 100 communities, Rodriguez and Aguilar began to get a clear picture of why solar hadn’t yet succeeded. “It is something that people have already seen, because NGOs have donated solar systems to these communities for decades. In many cases, the systems worked perfectly, but eventually the batteries died, and nobody was there to service them," says Rodriguez.

Instead of parachuting in their solar kits, Rodriguez says, Quetsol’s goal was to start from the bottom up. “I think the only way that we can solve social problems is through the free market,” Rodriguez explains. “So if we wanted to deliver a solution that was going to change the world, we would have to base our assumptions in the market and in the data that the market gave us.”

Building trusted relationships was one hurdle; the second was creating the right product for a market whose needs ranged from basic lighting and cell phone charging to powering a refrigerator all day.

“When we started investigating the technology, we decided we could deliver those same needs at a cheaper price, and through a better product. Instead of giving 30 minutes of very poor light with a candle, we were giving five hours of electricity with two LED light bulbs that could light a room of 15 by 15 feet," says Rodriguez.

Quetsol had to get its sales strategy right. Earlier this year, taking inspiration from the telecom companies that have made cell phones ubiquitous in Guatemala, they pivoted to a pay-as-you-go plan. “We changed our business model from being a company that sold technology to a company that is providing a service,” Rodriguez says.

During its six-month pilot, Quetsol enlisted local leaders, teachers, and store owners as franchisees, supplying them with smartphones that distribute codes to consumers; consumers then enter those codes on the dial pad of their solar kits to unlock daily, weekly, or monthly amounts of electricity. “They can consume as they want to, according to their financial flexibility,” Rodriguez says.

2013-08-22

Bringing Solar To Impoverished Towns, With A Model Straight From The Corporate World

Disillusioned by corporate life, Manuel Aguilar and Juan Rodriguez started Quetsol, an organization that uses business acumen to supply rural Guatemalans with solar power.

Juan Rodriguez was a rising star at Procter & Gamble in Central America when he started going through what he calls a “deep personal transformation.” He started with the company while still in college, working part time as an assistant brand manager on brands like Pampers and Pepto Bismol in between classes on business administration at the Universidad Francisco Marroquin, and had since been promoted to brand manager for hair care products like Pantene. But something just didn’t feel right.

“I was convinced that my job wasn’t adding value to the world, and that I was just adding more problems: consuming more shampoo, throwing more shampoos into the lakes and rivers, throwing away all that packaging, contaminating,” Rodriguez explains. “I felt that I was not aligning my values with my daily activities.”

He soon learned he wasn’t the only one feeling that way: Close childhood friend Manuel Aguilar—a Harvard graduate with a degree in astrophysics who had gone on to manage a global hedge fund—was feeling restless, too. “We were both in the same phase,” Rodriguez remembers. “Two best buddies, like, ‘Okay, we gotta stop doing this, and we gotta change the world.’ And that was practically it. That’s when we started investigating about renewables.”

Three years ago, the pair founded Quetsol, a company that uses solar energy to improve the quality of life of poor communities living off the electrical grid. In Rodriguez's and Aguilar’s native Guatemala, such poverty is widespread: Close to 20% of the population lives without electricity, relying primarily on candles for light.

The problem wasn’t exactly news. But after spending a year visiting close to 100 such communities, Rodriguez and Aguilar began to get a clear picture of why solar hadn’t yet succeeded. (Hint: it wasn’t for lack of trying.) “Going to a community and talking about solar power isn’t like going into a community and talking about space travel,” Rodriguez says. “It is something that people have already seen, because NGOs have donated solar systems to these communities for decades. In many cases, the systems worked perfectly, but eventually the batteries died, and nobody was there to service them.”

Instead of parachuting in their solar kits, Rodriguez says, Quetsol’s goal was to start from the bottom up. “I think the only way that we can solve social problems is through the free market,” Rodriguez explains. “So if we wanted to deliver a solution that was going to change the world, we would have to base our assumptions in the market and in the data that the market gave us.”

How to collect that data? Simple: “We started just going out into the field and doing interviews,” Rodriguez says. “We identify the communities prior to visiting them. We know the size of the community, how many people don’t have electricity. We know if households have dirt floors or concrete floors, or what type of roofs. Once we visit them, we don’t go looking for consumers, we go looking for community leaders. Instead of going house per house knocking on the door, we establish meetings in which each household is invited to participate. We present to them the solution, collect data from the people interested, and then we follow up.”

Building trusted relationships was one hurdle; the second was creating the right product for a market whose needs ranged from basic lighting and cell phone charging to powering a refrigerator all day. “When we started going to unelectrified communities, they were basically spending ridiculous amounts of money on very inefficient products,” Rodriguez says, citing examples like diesel generators and long walks to the nearest electrified community to plug in a phone.

“When we started investigating the technology, we decided we could deliver those same needs at a cheaper price, and through a better product. Instead of giving 30 minutes of very poor light with a candle, we were giving five hours of electricity with two LED light bulbs that could light a room of 15 by 15 feet," says Rodriguez. "Homes in rural Guatemala maybe have two 15 by 15 rooms. One is the room where everybody sleeps. The other is the kitchen where they cook and eat.”

He describes his experience visiting the off-grid communities as “literally like going to a different planet. Each time I go, I can see the impact of our product, how it has a positive effect in their reality. For them, it’s as important as getting a new car or a new house is for us. Going there has given me so much perspective.”

Finally, Quetsol had to get its sales strategy right. Initially, the organization worked with microfinance credit institutions to help families and communities purchase their solar kits, but after watching too many credit applications get rejected, they realized the limitations in trying to scale that model. Earlier this year, taking inspiration from the telecom companies that have made cell phones ubiquitous in Guatemala, they pivoted to a pay-as-you-go plan. “We changed our business model from being a company that sold technology to a company that is providing a service,” Rodriguez says.

During its six-month pilot, Quetsol enlisted local leaders, teachers, and store owners as franchisees, supplying them with smartphones that distribute codes to consumers; consumers then enter those codes on the dial pad of their solar kits to unlock daily, weekly, or monthly amounts of electricity. “They can consume as they want to, according to their financial flexibility,” Rodriguez says. “We give them complete freedom.” (They plan to roll out the pay-as-you-go model nationwide in November.)

Quetsol currently employs a staff of 20 people, and boasts board members like Google's Tom Chi. More importantly, the organization has electrified a little more than 3,500 homes so far, which Rodriguez says is “not that much, compared to our vision.” Quetsol is viewing Guatemala as a pilot program for global growth, with an eye on expanding to all of Latin America as well as Africa by 2015. By 2016, they'd like to tackle the nearly 700 million off-the-grid homes in Asia.

It’s ambitious, but Rodriguez believes he’s prepared. “I started my first business when I was 17,” he says. “It was a fruit and vegetable distribution company for restaurants and schools. Basically what I did was wake up at 5 a.m., go to the central market in the city, buy everything, and then resell it to the schools and restaurants. That was my first real job. My second year in college, I wanted to get corporate experience, so I applied at Procter & Gamble. Having entrepreneurial experience combined with corporate experience I think is crucial if you want to start a business. There’s really no way to do one without the other.” (He’s also got social entrepreneurship in his blood: Rodriguez is the cousin of fellow Change Generation subject and worm enthusiast Maria Rodriguez.)

Juan Rodriguez quit his corporate gig because he wanted to add value to the world. In bringing Quetsol’s solar solutions to a developing nation like Guatemala, Rodriguez says he can now see immense potential to disrupt the status quo and generate change in the first world, too.

“Developed countries are the countries that are contributing most to the problems that we have worldwide, sustainably, politically, financially,” he says. “The opportunity lies in breaking that paradigm. In countries that don’t have all this inefficient infrastructure already in place, we’re able to leapfrog that inefficiency and practically start from zero. It is very ironic how the poorest homes in the world will be the most sustainable. It’s a great opportunity for us to show the world that through problems that we identify as third world problems, we will find first world solutions.”

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