The Opportunity to Create Profit and Social Change

Over 4 billion people around the world live in poverty, surviving on less than $2 USD a day. Collectively, they spend over $4 trillion USD annually on essential products and services such as food, energy, housing, health, and water. Due to market failures and limited options, they generally purchase more expensive, lower quality products through the informal markets than are purchased by middle income consumers in formal markets. Competitive market systems and innovative distribution channels are required to effectively deliver necessary products and services to low income clients. These products, such as improved housing, rural technologies, and health insurance, allow low-income populations to improve their livelihoods and quality of life.

By jointly transforming low income markets, businesses and citizen sector organizations generate profits for the social impact they create. To advance these collaborations, Ashoka is pioneering Hybrid Value ChainsTM (HVC) models -- commercial partnerships between businesses and citizen sector organizations (CSO’s) that leverage the critical strengths of each actor to transform markets and deliver essential products and services to low-income consumers.

Hybrid Value Chains

Hybrid Value Chains result in big wins for all actors. Companies tap into new markets and expand their client base. CSO’s increase their impact by generating new revenue sources for their programs and expanding their service range to beneficiaries. Additionally, low-income populations improve their livelihoods as their basic human needs are met and new economic opportunities arise.

To demonstrate the effectiveness of the HVC model, Ashoka is applying the concept to transform three high-impact industries in a variety of locations. We are currently focusing on rural technologies in Mexico, micro health insurance in India, and housing in Brazil.

Additionally, Ashoka is fostering a community of like-minded business and social entrepreneurs from all countries and sectors who are eager to advance this new way of doing business. The HVC model is spreading beyond Ashoka’s direct implementation and variations are being applied to an array of industries in at least ten countries.

Examples of Hybrid Value Chain collaborations:

• Micro Health Insurance HVC (India)
• Low Income Housing HVC (Colombia)

Join Us

Ashoka invites HVC pioneers from all sectors to contact us to collaborate in the development of methods to transform markets to achieve social impact. In the past, we have supported HVC collaborations by facilitating connections between interested organizations in our network and sharing best practices. In addition to the community of businesses and citizen sector organizations, we look for professionals to provide pro bono assistance to CSO’s designing and implementing HVC’s and graduate students with business and social experience to participate in our internship consultancy program. We also welcome the submission of resources for potential inclusion in our HVC resource library.

To engage with us, please email fec@ashoka.org or visit our website: www.ashoka.org/hvc