The Wharton team outlasted a field of 34 teams to win the Energy in Emerging Markets Case Competition, focused on renewable energy development in rural Kenya. MKOPA—a residential solar company operating in East Africa—asked top MBA’s across the country: “How should MKOPA adapt its business operations in Kenya with its off-grid solutions? What should the business model look like?”
Student teams came up with diverse proposals ranging from new product recommendations to different business operating models. Beyond trying to make a profit, MKOPA serves an important role in rural Africa where there is poor access to the grid: its solar home systems are the leading way to electrify rural areas in Kenya where 30%+ of Kenyans still lack electricity access. MKOPA has already sold nearly 500k solar home systems though—predominantly in Kenya—so the solar home system market there is becoming increasingly saturated.
The Wharton team recommended a multi-pronged solution for MKOPA—first, it should expand its core business through product line expansion and business model optimization. As rural Kenyans continue to become more electrified, MKOPA can maximize the opportunity to upsell additional products. The team also recommended that MKOPA leverage its strong brand recognition across rural Africa and find ways to provide products to consumers without being limited by their lending capabilities (note: MKOPA’s current business model involves providing solar home systems to customers on credit. Rural Kenyans pay roughly 50 cents per day, the comparable price of lighting their homes with kerosene, until the system is paid off.)
Beyond expanding the core business, the Wharton team recommended that MKOPA should start deploying solar-powered ‘smart villages’. Smart villages are a community-based solution to not only provide electricity to rural Kenyans, but also to improve their living standards. The center would essentially be a large box (e.g. storage container), have solar panels on top and a battery underneath and use a small amount of electricity to sterilize water for the local community and provide a host of other amenities.
The judges were particularly impressed with the novelty of the team’s idea and also its comprehensive plan for the Centers, such as estimating energy consumption at the Smart Village and in-depth regional analysis to identify areas in Kenya to target first.
Team member Karl Chan, who previously spent time in rural Kenya launching a school for underprivileged youth, was particularly thrilled to be part of the team. “I loved being able to draw on my previous experience in Kenya and take a deep-dive into one of the most pressing issues for rural Kenyans today—energy access. To this day, many rely on kerosene lamps and diesel generators which are neither cost effective nor environmentally friendly.” Team member Michael Alexander was particularly moved by the team’s work: “I hope our collective work will contribute to increased energy security for rural Kenyans.”
In the end, the Wharton team agreed that this was a fantastic experience to learn about energy access in rural Kenya and build solid friendships along the way.
The Wharton team thanks The Kleinman Center at the University of Pennsylvania for its generous support, which enabled the student team to participate in this case competition.