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Over the past 10-15 years, entrepreneurs, impact investors, incubators and accelerators, foundations, development banks, major donors, and even some large-scale corporations have been working hard to reach those living at the BOP by building, investing in, and supporting for-profit businesses that reach BOP customers. Unlike traditional development projects that often rely heavily on government or philanthropic grant funding (which often suffer from finite funding streams), for-profit enterprises can both sustain themselves and grow over time as long as the product offered elicits sufficient demand and revenues from its buyers.
While these enterprises have offered promising examples of reaching the Bottom of the Pyramid (BOP), the question remains whether “asset-heavy” companies can be sustainable and scalable in serving the BOP long-term by selling “push” products.
A report by Monitor Deloitte in collaboration with the Omidyar Network, The Rockefeller Foundation, and the MacArthur Foundation analyzed 20 case studies of enterprises across sectors and found that even asset-heavy and push companies are able to successfully reach deep down into the income pyramid while achieving scale and profitability. This is a critical finding for organizations working in development, as one of the greatest unmet needs for those living in the BOP is access to products that require significant infrastructure and investment—clean water, sanitation, medicines, primary health care, and more.
As the debate continues, the implications from the report provide critical insight into innovative ways to reach deep into the BOP to provide critical goods and services to those most in need. The potential scalability and sustainability of for-profit enterprises merit additional attention—for push, pull, asset-heavy, and asset-light products alike.
Read the full article about asset-heavy companies helping the bottom of the pyramid by Hemali Bhashyam, John Cassidy and Kurt Dassel at The Rockefeller Foundation.