Acumen Fund

Topics: Investment, Sanitation, Rate of return Pages: 2 (765 words) Published: April 9, 2013
By looking at the case as a whole and using the capability matrix assessment as a baseline for my analysis, I would recommend Brian Trelstad to invest in Ecotact. Ecotact’s mission is well aligned with that of Acumen’s.. Ecotact’s founder, David Kuria’s goal was to make a social impact through providing sanitation facilities in the underprivileged areas of Kenya. Acumen’s core goal is to invest in ventures that make an impact in the Base of Pyramid sector and that show potential to scale while bringing in a return on investment for Acumen. Ecotact ranks high in its commitment to the Acumen Fund mission because it focuses on providing a solution for the sanitary need in the Base of Pyramid space within Kenya. Furthermore, Ecotact shows significant potential to scale by adopting the franchise model. According to the assumptions given in the case, having 30 running facilities with an average of 450 visits/day while being open 23 days a month provides strong evidence that Ecotat has the potential to not only scale but also serve more than 1 million people over the course of 5 years. Based on the facts, Ecotact has the potential to be financially sustainable in less than five years. According to the projected income statement, they can recover their costs and become profitable within 2 years. They have a viable financial plan, which provides a clearly stated revenue model that I believe is fundamentally sound. However, in reality these assumptions are unproven. Ecotat has the ability to make a substantial social impact hence it ranks high in this category as well. The business model has been proven from the Practical Action Venture run by David Kuria, which successfully improved the sanitation in Nairobi’s Kibera slum. The service provided has the ability to drastically improve the lives of the poor in the region and also the potential for systemic change. Overall, Ecotact ranked high in all the categories except for the capacity of its management. Kuria has...
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