How Do You Start Charging People You’ve Been Serving For Free?
“How Do You Start Charging People You’ve Been Serving For Free?” That’s the question that Brian Iredale, head of Nurture Africa in Kampala, Uganda is asking himself. At the same time, the handwriting is on the wall. To continue serving the people he loves, he must begin charging.
Brian came to Uganda in 1997. Seeing the challenges the country he faced, he decided to do something about it. He earned a nursing degree and returned in 2003 to launch a nonprofit that today is called Nurture Africa. He focused on the needs surrounding the community of HIV patients and their families, especially AIDS orphans. In 2009, he left his job as a nurse and began working full time for the organization.
Since its founding, Nurture Africa has provided services to its needy clients at no charge. In order to continue serving them, however, Brian has recognized that the organization will need to begin charging fees to make it more financially sustainable.
A view of the Nurture Africa campus
His plan is to begin offering some services to the public at a profit so that it can afford to offer those services at a discount to the needier families.
The organization offers microloans to mostly women to help them become more financially independent. For the loans, Nurture Africa has traditionally charged an interest rate of 1 percent per month. Going forward, Brian plans to charge 2.75 percent per month, which is still below the market rate of 3 percent. The loans of up to about $150 are expected to be–and generally are–repaid within six months.
Most health services have been offered completely for free. The challenge of charging low-income clients anything will be big. In order to be able to afford to offer the services at a discount in the long run, Brian plans to offer services to the general public, including more affluent customers, at a modest premium to cost to generate cash flow to support the discounts for needier clients.
The organization provides a variety of educational programs. As we toured the campus with Brian, we encountered classes going on all over. In one room, HIV-positive women who are pregnant were learning how to deliver a baby without infecting them. Another group was learning about hygiene. In another room, girls were learning how to sew and others were learning how to braid hair. Next door, a group of teens was learning to use Microsft Office on donated computers.
Girls practicing vocational skills
One of the students in the computer lab was Latif Sserunjoji. He explained that the students “need I.T. skills for life.” Latif was born after his mother received help from the organization before he was born.
Brian recognizes his own need for training at this critical juncture in the organization’s history. He’s enrolled in the Healthymagination Mother and Child program, a social venture accelerator that is a partnership between GE and the Miller Center for Social Entrepreneurship. He will be presenting to a group of donors and investors next week in Nairobi as the culmination of the program. The coaching and mentoring he’s received as part of the program has helped him develop a pitch for the investors and a strategy for shifting from a pure donor-supported model to relying on fees for a substantial portion of the funding.
As the tour came to an end, Brian guided the group to a small stage. Some of the students performed a dance for the visitors.
Brian noted that some of the kids who were born to HIV-infected women in the earliest days have grown up to become volunteers and even employees of the organization, coming full circle. In a similar way, Brian hopes to master this difficult transition and to have the opportunity to share his insights and lessons learned with others.
This week, I’m traveling in Africa as a guest of Santa Clara University’s Miller Center for Social Entrepreneurship’s Executive Director Thane Kreiner and namesakes Karen and Jeff Miller. Read all my reports.
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