Tuesday, April 14, 2009

Success in a Box

Here's an entrepreneurial idea that my client, Miles Smith, and I cooked up. He asked me to post it here to get feedback from you.

It's called Success in a Box. The "box" is a wind-up-powered laptop computer (see photo) that has been developed to sell for $199 to poor people in developing nations. When the user presses the start button, a menu of courses like this will appear:
  • How to start a successful business
  • How to become a better reader
  • how to become a better thinker and writer
  • Learn English (perhaps the Rosetta Stone software.)

Success in a Box could be sold for profit to the consumer or as a non-profit item to governments, foundations, and other nonprofits. For example, Grameen Bank, a microlending nonprofit, could give one to grantees. Prisons could give one to inmates about to be released.

What do you think: Good idea? Bad idea? Suggestions for improving it?


Anonymous said...

The One Laptop Per Child (OLPC) hardware is not available in the US for 100.00. It looks as if since the end of the "give one, get one" program, these are not available in the US via retail channels at all. Wholesale is a maybe, but it's probably bespoke to orgs that pass the OLPC criteria.

You can send one to a participating country by donating 199.00 to the OLPC foundation. The government there will make the decision on where it goes next.

I'm not sure what the hardware on these guys looks like lately; when I saw a prototype there was no "start" button (do you mean "power" button?) and although I'd heard you can run Windows XP on them of late, that's new and I don't know how well it works. They lost most of the in-house design team over abandoning the OS in a deal with Microsoft.

You might want to look at some of the "netbook" category systems from Acer, HP, etc.

Bare bones models are running around 300 for newer units, around 250 for "last year's" CPU. They can easily be straight windows boxes.

I don't see how this one can be used to turn much of a profit, the margins on electronics are razor thin and most of the folks who use them know what the actual cost should be.

Ben Casnocha said...

So is the value here the software that's loaded on the One Laptop Per Child laptop?

Marty Nemko said...

It's the integration of the package.

Anonymous said...

I've never seen course material integrated successfully into a computer format that would be good enough for a wide range of audiences.

I rarely see "canned" software mixes preloaded onto devices that winds up being successful - and it's not that it hasn't been tried. I'm thinking of the Larry Ellison and other ventures into dedicated email stations, various study curricula that have been tried for general audiences and generally haven't found a market.

I think the fundamental problem is that trying to do this changes what a computer is: a computer is as close to an infinite state machine as most people will get. Once you try and tether it to a few things it becomes less valuable rather than more valuable to a lot of folks, less interesting and less pretty than television.

That said, having access to curricula for motivated learners is an interesting idea; it's certainly one I'd like to see work, my concern is that variations on it have been tried.

* How to start a successful business

I'm not sure what the curriculum here would be. I have to admit, it sounds at first blush like the start of the Steve Martin skit about how to become a millionaire.

* How to become a better reader

This is doable, but you might not want to actually call it that. Go to the Gutenberg project website, and load up on classic literature that's out of copyright and available for free.

To give it additional value, you could have someone write questions about the chapters on the box. The problem is that if they're multiple choice, they're just mind-numbing, and if they're essay questions, how does a reader get feedback? Perhaps you could sell a service contract for reading and commenting on the essays?

You could of course have the essays composed in a tool that does an automatic (free) spellcheck, like Firefox.

* how to become a better thinker and writer

See Gutenberg project above : ) It's really difficult to use a computer to teach people to become globally better thinkers, but as a rule, the more you read, the more you think, and the likelier you are to do better writing.

But to do better writing, you really need some sort of interaction with an audience, where the goal is not acceptance of You as Special but on reading critically.

You might be able to do a service offering based around that, but you'd need a government or foundation to pick up the cost of support en masse, and you'd need to have a way to come up with decent readers, as opposed to folks churning through the essays like an Amazon Mechanical Turk project.

* Learn English (perhaps the Rosetta Stone software.)

I haven't used Rosetta Stone, and don't know how good it is. But this is a clearly focused goal and probably a good one. If the lessons are good and you find an audience really committed to learning language, it would be valuable. I'll predict you'd do best with the emphasis primarily on written rather than spoken English.

I say that because after many years in IT, one of the policies I implement most quickly in the workplace is "we do not support audio unless there is a business case to be made for it."

Audio hardware has gotten better lately, but it continues - especially anything involving recording, rather than simple playback - to be a source of confusion and error.

A very clever idea I ran across some time back was a PC that had around 40G of content from the most popular websites in the world aggregated before it left the factory. This let it serve a lot of content even when the connection was not working - it was intended for distribution into rural areas.

These days, you can build or buy devices which do similar things for your whole business, so you aren't running to the web when the second person wants to read today's newspaper. I suspect that the 40G box could be set to synchronize content from a master database when it had a connection and keep refreshing itself periodically.

Course material could be part or all of such a preload; this could be very appealing to parents who want their kids not being on the "live" internet. I don't know if the kids would be as interested, and you again start getting into a pretty elaborate back-end.

Marty Nemko said...

Thank you for your comments.

The primary target audience will need a very basic program--we'd search to find the right ones, try to get it donated for those computers serving the $1 a day crowd.

And the $199 price is quantity 1. Quantity 10,000 I'd imagine gets us to the $100 mark.

Dave said...

How to start a successful business
How to become a better reader
How to become a better thinker and writer

Learn English (perhaps the Rosetta Stone software.)

I have heard many good things about the Rosetta Stone software.

I don't see why OLPC is necessary. Computers don't improve academic performance.

Marty Nemko said...

Computers do improve learning--especially when there's no alternative--this is aimed heavily at people living in, for example, rural Rwanda.

Anonymous said...

I'm still scratching my head about the entrepeneurial side to this.

The project may be asking companies to donate hundreds of dollars worth of software (the Rosetta Stone package retails for five hundred) per system. The target audience is the "$1 a day crowd" (an ugly neologism to my ear and I would hope your associate avoids using it in public or private discussions.)

The goal includes hoping to get a discount from the OLPC foundation. OLPC is already a loss-making charitable enterprise which is specifically targeting young people in the developing world with its hardware. The OLPC is not available to governments for 99 a unit in blocks of 100.000. (As close as I can find, Peru paid 188 per when it signed on to buy 250.000 units in 2008; the purchase may well have been subsidized by the UNDP or the Gates Foundation.)

The OLPC processor runs at 433 megahertz, less than half of what the Rosetta Stone package requires, and has no hard disk, but rather a 1-4 G flash memory drive. Rosetta alone is looking for 600 M of free space to install on; I would be surprised if the most common 1G configuration would have enough room left for Rosetta.

The Intel Classmate PC is a better fit: it's a netbook based PC running an Intel processor and shipping with a 30G harddrive and Windows. It is a rugged clamshell design, and in the US they cost 400 apiece. Quantity 10k would get you a discount, but probably not a discount to below the bill of materials on the product, and 100 dollars is almost certainly above the BOM on a product that currently sells at 400 a unit.

So you'd be going to Microsoft, Intel and Rosetta and, realistically, asking them to give the gear away. I can think of one outfit that has done this, and they're able to do well with Microsoft, less well with everyone else. (Especially the hardware people, who can't just knock another unit off at zero cost. Cisco, for instance, has a wonderfully cheap but incredibly tightly controlled charitable giving arm. You can't get quantity 10,000 from Cisco, you can get quantity 20 from Cisco. Or you could go to work at Cisco and be part of their charitable group in-house instead, because they have their own priorities in giving which they control, understandably so, and those are the projects that can get large blocs of gear.)

What I'm trying to understand is: where is the entrepeneurial angle here? Yes, this is a nice idea, but if you're trying for that level of donation from hardware and software manufacturers, they're going to want to see not-for-profit paperwork and the history and salaries of your top five employees.

If the model - and I had assumed when thinking about this that if it was entrepeneurial, there was a business model - is to charge someone for a support contract for the systems, you'll get a couple of questions:

- "why your group as a reseller of OLPC or Classmate hardware, when we could work directly with OLPC which has a multiyear track record and a ton of MIT grad students who work essentially for free?"

- "why should we donate thousands of units of hardware below cost and software essentially for free to an enterprise which will charge for support enough to have a business plan, rather than supporting itself through UN or USAID or Gates grants?"

I think there are answers to both of these:

- OLPC is basically throwing laptops in huge blocks into the field and has not decided how or whether to assess their effectiveness. Your group would like to develop some metrics that don't assume "computers improve learning," but instead set out to show it.

- What people get for free, they often assign a value of zero to. Doing support at no cost to the recipients or recipients' governments would be nice. The end-users will certainly value the hardware; it is very likely that overwhelmed midlevel government employees will work on things their government is actually paying for before they'll track a contract's performance carefully. (Micropayments from the end-users, like microloans, would be cool, but will the hardware last long enough to break even if micropayments from end-users is the primary revenue model?)

Are there other ways to get people and governments invested in things they get for free?


Identify a technical group in the country you'd like to help which has specific needs, and do some project planning with them before the hardware arrives. Let them decide what is needed on systems being deployed into their country, and be sure they have sufficient capacity to absorb a large donation.

The problem with this latter from your point of view is that the recipients now "own" the gear and you can't support it, since it's deployed to their specification and you no longer know how it's set up. So it's not entrepeneurial.

I know from personal experience that this model can be used with considerable success. The folks on the receiving side really appreciate being given ownership of decisions about how to configure gear they will use appropriately for their environment.m

Marty Nemko said...

What an outstanding post, dear Anonymous. I will certainly be sure my client reads this. This is a great example of how limited career counselor advice is--you really need to get advice from true experts--for example, by asking the blogosphere for its wisdom. You are a magnificent member of that blogsophere. All the best.

Miles Smith said...

Thank you to ALL those that have contributed comments/feedback. Wow! The comments are all very helpful and add a whole new level of thinking that we hadn't reached in our opening brainstorm. Consider they duly noted.

It's safe to say that the model that makes the most sense at this point based on feedback and further thinking on this end is the nonprofit model where we can receive charitable and government grants for the costs associated with doing this well and supporting it. In the short term, a fiscal sponsor could be our partner to receive the grants/donations.

In addition, there is some logic in considering a pilot or two (in the U.S.) with a targeted population to prove the validity of the concept before taking any of this to scale.

Please let me know your reactions to the two refinements listed above. Thanks everyone!

Miles Smith said...

PS The $100 price point is not a fixed one. Clearly, if we can create a tool/part of a solution that costs "pennies" relative to other tools that haven't worked, the amount spent on the tool is flexible. Using the Intel Classmate PC as an example ($300 cost), it could prove still very economical to spend $500 per unit fully loaded with the courses and supported. Furthermore, maybe some of the cost is shared with partnering nonprofits or the users themselves contribute some $ towards the cost in the way of a loan that is paid back over time similar to a micro-finance arrangement.

Anonymous said...

My last piece of thinking, and I hope it'll be shorter than some of the others:

- pilot projects are a good idea.

- I like the idea of trying to get these into the hands of ex-cons. I would not think that going to the prison system with this, nor to the probation system with this, is a great idea; both of those systems wind up being very pessimistic about their charges.

- I'm not sure individual ex-cons are the right owners.

- I'm thinking that residential halfway houses for parolees might be an ideal placement for these in the US. The equipment would be common property; there would be no expectation of privacy of the device, and the device would probably be best as "house property."

- you might want to talk to Patton College in Oakland, in the Fruitvale. it's a small Christian school which I understand does a lot of excellent, hard work with prisoners. they could give you some really excellent feedback about things like what curriculum would be most helpful, things not to do (internet access is a parole violation for some,) and could probably get you set up with contacts who understand how the residential rehab facilities for recent parolees are set up.

I don't have any affiliation with Patton, but if they've got staff bandwidth they might be able to act as the nonprofit that receives grants, charges an administative overhead, and helps you buy a few of these things.

Before you start, be sure you have someone on hand who can build a working 'gold master' harddrive image - you will want to be able to reimage the drives on these as they are damaged or as the licensing requirements change or as you reconfigure your software load.