Hacking a Non-Profit (special guest: Leila Janah)
I'm super psyched to have Leila here and have been involved with Samasource for some time. So we're just gonna jump right into it, because I wanna get into the tactical. And you might be thinking to yourself, well, economic, okay dot org, a nonprofit, like what does this have to do with me. Well, good entrepreneurs are good entrepreneurs period, and we'll get into that. But, so the first thing I'll ask is just, you have the horsepower. A lot of people have seen your TED presentations, you're a great presenter, you could've gone into any number of industries, why did you end up choosing nonprofits and Samasource? And I just wanna show off one thing, too. Your wrist. That's a true believer, that's Sama on the wrist. (laughing) So, if you could just give us the origin story a little bit.
That'd be real.
You don't have to do that, by the way if you wanna found a nonprofit.
Yeah, not mandatory, you don't need branding.
Don't have to tattoo the name on your wrist.
m just very passionate about this issue of poverty alleviation. When I was 17, I went to Africa to teach before I started college, and I taught English in a small community in Ghana, and I thought I'd go there and teach these poor kids English, and lift them out of poverty, and I got there and there were all of these incredibly bright students who all lived on less than two dollars a day but could name US senators, and could recite parts of President Clinton's speech when he visited there. And I realized that there was this wealth of human talent that was going untapped in poor countries, simply because people there had lost the birth lottery. Simply because they happened to be born in a poor place. And then I learned later that four billion people around the world make less than three dollars a day. And that's already adjusted for purchasing power, so that's what three dollars would buy you in an American city in 2005, and it's just hard to fathom that, you know we've put a man on the moon, we've mapped the human genome, and we still live on a planet where so many people live in suffering. So I felt like a moral calling to do something about it. I worked as a management consultant, actually had a gig in Seattle for six months, and it just felt kind of empty to me when I knew that there was this huge problem and that I could use my entrepreneurial energy to fix it.
And uh, was there a particular point, when did you decide, like alright, I'm all in, like I'm gonna do this. What was the moment?
The aha moment?
I had worked in nonprofits, and international development as an undergrad. I went and got grants and went abroad to Africa, and felt really disillusioned by a lot of the traditional approaches that I saw which were all extensions of this idea of giving a man a fish, right. And even when we taught a man to fish, in some of the more enlightened programs that I participated in, we were still teaching men to fish who live in deserts, right. So there was no connection to the market and there was no broader understanding in the nonprofit world of how to create massive numbers of jobs for poor people. And I felt like there was an acute need. I went into the business world trying to understand something about business so I could apply that learning to hopefully starting a nonprofit, and I had my aha moment when I was assigned to work for a big consulting firm in India, a big outsourcing firm in India, sorry. And I had this consulting assignment to help them IPO. And this was one of the giant firms that all Americans were afraid of. There were like, 12,000 people sitting there taking calls for British airways and big American and European companies. And I thought, if this method of digital work can provide jobs to middle class Indian people and middle class Filipino people, can we then take it to the next level, and use this same method to provide jobs to they very poor people who live in those countries. And I had my aha moment when I was walking a call center floor one day, when I was on this project in Mumbai, in India. And I met a guy there who was from Dharavi, South Asia's largest slum. And this is like, where Slumdog Millionaire was filmed. So he commuted in, in the morning, from a place with like, cholera outbreaks and open sewers, and just horrible development outcomes into this brand spanking new outsourcing facility. And this little light bulb went off in my head, and I thought if this guy can do this kind of work, then surely other poor people, you know.
Can do it.
So this, people think, people have ideas of what nonprofits are. They're like okay, like you see them on TV, they ask for money, they do this. What is Samasource's model? How does Samasource work?
So, our mission is to connect people living in poverty to work via the internet. So we break down big technology projects from companies in Silicon Valley that include Google, and LinkedIn, and Microsoft. We break those projects down into really small units of work, we call it micro work. And then we train poor people on the other end to do this work from local computer centers. And we work exclusively with women and youth from very low-income backgrounds. So people who previously made less than four dollars a day, maybe they were employed in the informal sector, you know selling handicrafts by the side of the road, that sort of thing, and we train them to do this computer based work, which increases their income threefold while they're at Samasource, and then they tend to stay at that income level after they leave. So many of our workers are able to afford higher education, they can go to college for the first time, or they can move into higher paying work. Often, you know as I mentioned, making up to four times more than they ever made before.
So, just to point out the obvious here, one of the things that has sparked a lot of emotional response in the US is like, outsourcing. Like, oh my God, stealing American jobs. Or like, oh my God, slave labor, how do you feel about like these people shackled to radiators working for you in India? And it's like, well actually like, they could not be happier to be doing this work and the impact dollar for dollar is so enormous, in terms of looking for like the highest leverage place to put a single dollar, it's really incredible. So now, you mentioned a couple names. 'Cause I know we have a limited amount of time to talk. Like Google, these huge companies, right. But, I would imagine the early days wasn't so easy. Right, you couldn't just walk up be like, hey Schmitty, what's up buddy, hey I want you to give us a big check, whatever, right. So, maybe you could talk about like raising your first big check, first big donation. First big deal, like with a company. Like, how did that happen? Like, what was the actual, what was the pitch, how did it like, I would love to just hear the story.
It was so hard, and so much less glamorous than it seems in hindsight.
In the early days, so I quit my job in 2007 in Manhattan and I had like, really great job, fancy apartment. You know, corporate credit card, the works. And much to the horror of my immigrant parents, told them I was gonna quit that stable, you know salary and move to Silicon Valley where I had a position at Stanford, a very sympathetic professor had offered me basically a title with no funding and a desk at a corner of the campus. And I told them I was gonna go there and write up a business plan for this idea that I had. And um, I had also, I'd had the basics of a business plan and I'd entered it into a competition. So I had like, 20,000 dollars that I'd won from a business plan competition I found online. Armed with that and little else, I moved to Silicon Valley, and very quickly ran out of money. In the early days, I had to do SAT tutoring on the side to make ends meet, I had to move in with an ex-boyfriend and stay on his couch for like several months, it was pretty tough times.
All together, very glamorous, yeah.
Yeah, not glamorous at all. (laughing)
Sounds really comfortable, right.
And um, and you know but I had to, I had to do what a lot of entrepreneurs do, which is get out of my comfort zone and ask people for things. You know, I had to start asking my friends to support me, I had one donor in the very early days who I met at a cocktail party who gave me a recurring, it was like a 25 dollar a month donation on PayPal, and it was just labeled protein. Because I had told him that I only ate Top Ramen. (laughing) Which was like, true.
It was tough, um.
And then, our big um, our big uh, I think our winning streak started when we got into the Facebook fund, so there was this incubator program and now there are so many of these all around the valley, but at the time this was like.
How we first met.
Back in the day.
That's right, the summer of '09. This was still in the early days of of all of these incubators, and Facebook had one that was to encourage promising Facebook applications and we were one of two nonprofits that were selected out of 20 organizations to do this program for, I think it was like for two months, except that they didn't give the nonprofits any money.
Yeah, I remember that.
They gave the for-profits an investment, right. And then they guilted all the people like you who were in the room into giving us some contributions. So I probably made the best pitch of my life at a cocktail party following that event that one of the angel investors was part of that had invited me to.
So you went into Facebook fund, you met these different angel investors, and then you met, you then met again this angel investor at the cocktail party.
Actually I met him, he's Ariel Poler. I think you knew him.
Yeah, oh yeah.
He was one of, you know, one of the angels who came to the final pitch.
Yeah, Ariel Poler's a great investor.
Often I find that these serendipitous events just happen as a result of you continuing to spread the word. You know, again and again. So um, so I did the final pitch day, Ariel was in the audience, he said come over, I'm doing this cocktail party, I'm allowing three nonprofits to share their message and I'm gonna invite all of the rich people I know to come and support you.
I at that point had just sort of reached the limit. I had run out of all my cash, I had sort of overstayed my welcome on the futon, and was just really ready to make this happen. And I had also spent the summer traveling to Kenya to meet some of our workers. We had about 50 workers at the time who were doing Samasource projects. And I met this refugee, in a pilot that we'd done in a refugee camp, and his story was just unimaginable. He had left his home village when he was like seven, walked across the border to Kenya and lived his whole life in this refugee camp just dirt poor, and was so desperate to contribute something to the world.
And so we showed him how to do micro work and he started doing work for Microsoft inside this camp, and it was like the coolest story I'd ever heard. And then I left the camp, and he sent me a Facebook friend request, he'd like, figured out how to use Facebook on his own from inside this camp in this computer lab. So I told that story to this group of donors, and at the end of it I said, you know, you guys have invested in you know, silly iPhone apps that let you share your party pictures. You've invested millions of dollars in all these companies that have gone bust. Like, even if you think we're gonna go bust, this is a worthwhile endeavor. And you should invest in what we're doing, and it's not gonna give you a, you know, and for-profit rate of return, it's not gonna give you any return except the social return and maybe you know, karmic dollars or something like that. And I think it really resonated with people. So out of that cocktail party, two of my future board members and longtime donors came.
Awesome. And following that then, the hard work begins, right. It's like you have enough to keep you afloat, and then you have to go out and you actually have to get the companies, and you also have to set up the workers. What was the first big corporate partner that you got on board? How did that happen?
So the first contract that we got, and this is tricky because um, we do enterprise sales, right.
So, I much prefer a consumer audience, I love talking to people. I love, you know, selling individual people, but selling a company is a whole different process. And that was a big, you know, learning for me over the last few years. But our first deal was with actually a nonprofit, and it was this organization called Benetech that operates the largest library for blind readers in the world that's online, it's called Bookshare. And so they have this huge need to digitize all of these books from PDFs.
Into text files. And then there's an audio program that reads the text to blind people. And so there was an affinity there, I thought why not go after a contract from a firm that I know likes what we do. They're socially minded. And I'd heard that they were looking for vendors and I went in there with a brochure that I made on Pages, on my Mac. Like I literally had made it.
It must have been beautiful.
It was god-awful.
Not to insult your design abilities.
I'm not a designer, we didn't have a budget, it was god-awful, just be honest. But luckily, they were more concerned with the substance of the offering than the style, and I just pitched hard, you know, I told them I got a meeting with the CEO, and this is one thing that helps, I think the.
Did they approach you or did you cold email? I mean how did that?
I cold emailed Jim Fruchterman who is the CEO of the company, probably like eight or nine times before he responded to me. (laughing) And um, I feel like this is a persistent theme in successful entrepreneurs that I've heard of, is just willingness to get out there and not be afraid of people getting annoyed with you. Right, if you think you have an important message to share with people, they need to hear it. And short of being obnoxious, which you shouldn't do, right, I think people appreciate that level of persistence. And Jim's an entrepreneur, he gets it. So he took the meeting, and I said look Jim, you know, I have these young guys in Nairobi who are desperate for work and I talked to him about the Kenyan elections that had happened in and these riots that had happened after the elections, and the riots were a direct result of high youth unemployment in Nairobi.
It's like the Arab Spring, right.
Lots of young men who have no economic opportunity, of course they're gonna riot. So I said, you could play a role in preventing this from happening again in Kenya by employing all of these young guys who would otherwise be out on the street. And if our quality is worse than your other vendors, then you know, you can fire me. We'll write that into the contract. But I guarantee you that I will make it happen and I will be personally committed to making this project work. So he signed the deal, and four years later they're still a customer.
That's awesome. That's so cool. Alright, well I know we have limited time. I want people, one of the things I wanna emphasize with everybody who is here today, is it's easy to look at where they are and say oh well, you know, that's Leila. That's not me, that's this person, not me. It's always challenging. Always, like you have, there's so many rites of passage. And a lot of people quit when they're like, 100 feet from the finish line. So anyway, having said that, I want to definitely jump to audience questions, I wanna ask one more question though, first. And that is, the most common, like the biggest waste of time. Let's do biggest waste of time, but biggest waste of time and or mistakes that nonprofit, people who jump into a nonprofit, the nonprofit world, with good intentions make.
From your standpoint.
Sure, well I think the biggest mistake that nonprofit leaders in management make is not being transparent about failure. You know, in Silicon Valley, we're used to like a nine out of 10 failure rate basically.
Right right right.
That's what VCs anticipate. Nine out of 10 of their investments are not gonna yield much. And um, yeah and in the nonprofit world, talking about failure is, it's poopooed right.
People think that you're a terrible leader. And I think that that needs to change if we want to be innovative, and we want to take risks and try new things which we absolutely need to do to solve these big problems. We have to be okay with owning up to failure. So we try to publish when we make mistakes, we try to publish that in our newsletters, we're actually rolling out this quarter a section of our website devoted to impact, including things that we think we spent money on that we shouldn't have.
And things that we would do differently had we known better, and our hope is that other nonprofits will be able to look at that and not repeat our mistakes.
Yeah, awesome. Okay, so let's jump to some questions. Should we take audience questions?
Interweb questions, let's do some audience questions.
Let's start with that. Christina?
Oh, that's me. Um, perfect, um, well my name's Christina, and I work for nonprofit based in Canada called Cause Kids, and it was founded by my parents 28 years ago, and we focus on education along with micro credit, and have basically the next generation of child sponsorship. And I want to be able to crowdfund 1,000 scholarships for kids in Sierra Leone, and it's a new project within an organization that has existed for a while. So I guess my question is, if you were starting again, trying to get your message out, where would you start? What was the, kind of the big catalyst?
That you found kind of skyrocketed the messages to make people kind of see your name, recognize it, and kind of relate to it.
The right person to ask.
You're the master of media.
Absolutely, I know.
I don't know if that's true, but I love that question because as a side project, I was telling Tim earlier and he was making fun of me, for having my hands maybe in too many pots. But as a side project, I launched a crowdfunding site called Samahope.
Which is just like Kickstarter or Kiva, but for surgeries in developing countries.
For people who can't afford them, and we're starting with surgeries around birth complications in Sierra Leone.
Oh really, that's so amazing. Yeah, you should check it out.
And so, just thinking about your problem reminded me of the early days of Samahope and trying to get the word out there. And what I found is firstly relying on your network to amplify the message is really important, and we forget that you know, the best to communicate a story is though our friends and family, 'cause those are the people who are most gonna resonate with your message.
So, I actually, this is probably not a best practice. But I've exported my Gmail contact list, so the 4,000 people that I communicate with most frequently. And I wrote, I didn't write them a spammy message, I wrote this long personal letter. I got engaged a couple months ago and so I've put that in there.
Yup, I got the letter.
You got the letter. You know and I said, this is my life, this is what I've been up to for the last year, you know Samasource is going well, you guys have supported me with Samasource, I got engaged to a great guy here's a photo, you know, and I went to Sierra Leone and discovered this horrible problem which is that one in eight women die in childbirth. That should not happen on our planet. It's an abomination, right. And we have to do something about it. And so, this is a side project that I'm doing, and I didn't ask for money, I said this is a campaign that we're running on Indiegogo, which is like a Kickstarter for nonprofits. Check it out, but more importantly, give me your feedback on the site. And I have had like, at least 100 people write these long, thoughtful emails with detailed feedback on the work that we do and that's the first step, right. Some of those people might be donors, others might not, and really it's about more than harnessing just their capital.
Yeah. This is, there's a couple of really important points. 'Cause I work with a few nonprofits, been really fortunate to have you know, some involvement with Samasource and have gone to Kenya. The best nonprofits get people invested in their campaigns or their projects before they're asking for money.
Right, so like website feedback. Or, how would you change this messaging, before it's like hey, open your wallet. 'Cause they get hit with that all day long. Whether it's Samasource, DonorsChoose is another nonprofit that I work with out of New York and have for many years. Charity Water, I think another good example. And the second part I wanna add, since I did get that email, is that the end of the email, it said, in effect, like if you're too busy no problem, like if you don't wanna get these updates on my projects, just let me know and I'll take you off the list. Very soft. Like, and just hopefully for people who didn't see Philip, or did see Philip, same thing. It's not a like, I know what's perfect for you, please do this now, thank you for your favorable response, where you're just like uh, you know. Very like, even-handed, take it if you like it, ignore it if you don't.
So more of a direct ask? More so like a question, like for feedback?
No, no, it's more that this is a, and I want you to speak to this. But it's viewing it as, there are plenty of direct asks. But you don't necessarily, you don't make that direct, she did have a direct ask.
She just gave people an out.
And she had a direct ask before it was write a check. But also just from a media standpoint, you're really good with the media.
So if you're like trying to get your message out, what are the things that you have, what have differentiated Samasource in how you've approached the media or presented the message?
I think a couple things, um. One is I think we benefited from some early training and storytelling. So you know, I use these big numbers like 4 billion, or one in eight women dying in childbirth, and that's sad but really what stands out for a lot of people is the story I told about the refugee whose name is Paul Parach who I still correspond with on Facebook. People love Paul, people resonate with him. People feel empathy towards an individual person. So the more you can personalize a story, you know like if there's one child that you can think of in Sierra Leone, who's got a, you know, maybe elements of their story will resonate with families in America.
That's really what will build that connection. Charity Water did a great job.
Charity Water does a great job.
They had a video.
They also captured on video which you do also, which DonorsChoose does, using video and visuals.
Absolutely. I loved the video, they had a video where celebrities in Manhattan were going to fill up these jerrycans of water from Central Park.
Yeah, in Central Park.
And the water was like, brown and yucky, and you were like oh my God, that's horrible. And then they were like, well this is the reality for all these people around the world. And as soon as you personalize it, and you imagine yourself you know, dragging your jerrycan and your kids to Central Park, all of a sudden that problem becomes more real.
That was kind of like, part of our ideas, that we wanna give people the opportunity to be micro-philanthropists, right. So um, that everybody has this amazing experience of giving and when I was in Sierra Leone this year, I met the girl that I have sponsored for the last few years and it was this amazing thing because she was entering grade nine and uh, that doesn't happen, right, like because of Cause Kids, she's stayed in school longer, she didn't get pregnant, she's gonna have healthier kids as a result of that, she's probably well, we work with mothers too to prevent child death, right. But there's all these amazing things that happen with educating the girl child. And it was a great experience. But to be able to share that and spread that message is challenging.
The other thing I would say is, people in the nonprofit world very infrequently view each other as competition. Which is somewhat different in the for-profit world. So for instance, develop a network with people. Like the Leilas of the world, the Charles Bests, DonorsChoose, Scott Harrison, Charity Water, and you can trade best practices.
So like, if you always have and I'm not saying you do this, but a lot of nonprofits are so focused on the donor, that they forget they have this wealth of assets and resources around them. So for instance, Charity Water really pioneered and popularized this concept of the birthday giveback. So it's like an, it's my 30th birthday but I don't want any presents, I want you to donate 30 dollars to this well. Or something like that. Hugely successful. Then DonorsChoose has been really good at bringing in corporate partnerships, like Crate and Barrel, like why don't you send a 10 dollar gift, like a gift card to DonorsChoose to each of your customers who are the most loyal as a thank you. They've been really really good at those corporate partnerships. And so I just introduced it to them, over drinks in New York, and I'm like, you guys have to like play friends, go go go. Because you do so many different things so well, like just trade, and they did. So now both of them have both of those tools. Uh, and.
So Tim, we've got about five minutes left.
And I think we've got one more question from Jessica, I believe.
Let's do it.
Yeah. Hi, I'm Jessica. I work in Vancouver and I do investor relations work. Uh so, similar I think maybe to what you did 2007 before you started doing nonprofit. I've been looking at um, putting the businesses together in terms of nonprofit and for-profit, but I guess my biggest question is for you, is how did you scale your business in micro work? Starting with the first piece, and then scaling it along but yet keeping it personal back to your donors. Which you touched on a little bit, Tim. But if you could expand on that a little bit.
I'd appreciate it.
It's a great question and some donors really want to hear the scaling piece and other donors wanna hear the stories. Um, so just to give you a sense of the numbers, we have now brought more than 15,000 people out of poverty by directly employing 3,200 people around the world doing work. And when we started, I mentioned we had about 50 people in the first year. So we've scaled a lot in the last few years. It's a very direct model, it's different from a Charity Water in that we are giving people employment for a year, six months to a year, so it's a very big investment we're making one person, but then that person has a job and there are all these following effects. So um, we approach scaling firstly by raising the capital. We were funded by the Rockefeller Foundation, Google.org and some big donors, and that took a lot of time. Some of those are two and a half to three year sale cycles. So you've gotta really, you know, proactively keep updating the donor, and we're very impact and metrics oriented, so every quarter we share a bulletin that says, these are how many more people we've moved over the poverty line this quarter, these are the challenges we had, this is how much donor capital we took, and this is what we spent it on. And I think people appreciate that. And then in terms of communicating the message, we love those simple line charts that The Economist uses, you know, just a simple line that goes up like that is usually not for a lot of people. Um, and then we supplement that with more personal stories. And we share you know, those basic charts for all of the relevant figures. Sales, people employed, you know, you name it.
A really good way to get an idea of how successful nonprofits continue to sell their donors and their support base, looking at their annual reports. So like, Room to Read does a great job of showcasing that. So John Wood wrote Leaving Microsoft to Save the World, great book. Room to Read's a really good organization, but their reports are beautifully done. They're really slick, so I would check that out. Uh, also if you wanna watch someone who's like currently really hustling, they're all hustling hard, but you know Kushal Vittana.
He is intense, he's awesome. They just had their first million dollar month, in terms of bringing in money. So they're sort of like a kiva.org for education specifically. And take a look at their press releases. Take a look at the graphic representations they use in their science, all of which are intended to show how much of an impact a single donation has, but also how it scales. Um, what else, would be a good way to look?
You kind of zoom in, and you zoom out, and then you zoom in again.
We have a ton of questions from our audience that is watching online, but we're gonna pick out one for you at least for starters, is Ikare Yuki, sorry if I pronounced that incorrectly, who asks, "So how do you break into the terrain in countries where you don't know the business and the terrain infrastructure?"
Hmm, good question.
That's a great question. So um, we operate what we call a pull model, we're pulled into places rather than pushing ourselves into places. It works very well in places like Kenya or India or Ghana where there's a base of educated, local entrepreneurs who've built local computer businesses. So when we started, I had one partner in Nairobi who was a guy who ran an internet cafe. And I approached him with this idea, and he was a young entrepreneur, he was really hungry, and he said you know, if you could find me work from America, I would go. I would guarantee that I would hire poor people, I would recruit from these slums, and I would train them to do this work. But the problem is we don't have the work. So he, he started off with four employees and now he has over 150 all doing Samasource work. Actually Tim visited his center, Steve.
Yeah. Steve, he's awesome.
He was an awesome entrepreneur, is an awesome entrepreneur.
Multiple floors now, that's great.
In other countries, we sort of rely on the power of our network, so people have talked about us at different development conferences, and local entrepreneurs who are looking for a way to bring in more revenue have found our website or have read our story, or have heard our BBC radio interview, and come and applied on our site. And then we select from that pool that's already applied. The benefit of that is that we know we're working with somebody who really wants to work there. We make the application process very rigorous, it's really hard to be an entrepreneur in our network. And that means that the people who are left at the end are pretty excited about this opportunity and take it seriously.
Amazing, um, I feel like an ongoing theme for the next two days is going to be um, I wish we had more time. (laughing) But, I think we do have to move on unfortunately. Um so, Leila, can you if you have any closing thoughts that'd be great, and also can you tell us um, just one more time how to kinda find your organization, Samasource, and Samahope as well.
Sure, uh well we are on Facebook and Twitter as Samasource S-A-M-A-S-O-U-R-C-E, and Samahope.
What does Sama mean?
Sama means equal in Sanskrit. Um, so you can find us there and I'm Leila_C on Twitter, and just Leila at Samasource, you can find me everywhere. And my vision for the organization is to turn it into the Virgin, Virgin the company, as was mentioned earlier, the Virgin for social business. I really think that there is a whole set of tools that we can use from the for-profit world to built more effective non-profit solutions to some of the world's most pressing problems, whether it's funding, maternal health in Sierra Leone, or providing work to people who desperately need it, and I hope that there's in the future, a family of Sama businesses that we start.
Thank you so very much.
Thank you so much.
This is fun. (laughing)
Alright, I'll see ya.
We gotta catch up.
Alright, take care, cool. Alright, well I will let, I'll let you.
I'll let you released from custody.
Thank you. Thanks.
And we march on.
And we march on, thank you Leila.
And just one more comment I would make for the nonprofit inclined, or even for the for-profit inclined, take a look at what some of the best nonprofits do with their media, like four media tabs. Donorschoose.org does a good job of this. Make it easy for people to cover you. If they have to contact you and you're busy doing something else, lost opportunity. Have high-res like, versions of your logos. Have head shots. Have bios. Have all of that stuff, make it easy for people to cover you.