Sanergy: MIT MBAs Tackle a Messy Problem

Lindsay Stradley is an MIT MBA and co-founder of Sanergy, a public sanitation startup in Nairobi, Kenya.

Lindsay Stradley, 32, deals with a lot of crap–literally. The petite brunette looks better suited for a J. Crew catalogue than the slums of Nairobi, Kenya, much less a startup in sanitation (a euphemism for excrement). The former Teach for America educator and Google operations manager knew she wanted to carve out a career in social entrepreneurship and figured an MIT MBA could set her up for success. Little did she know that she’d connect with her future cofounders before ever setting foot in a classroom.

In 2009, Stradley signed up for a pre-orientation MBA hiking trip to New Hampshire and found herself in a carpool with David Auerbach, who had worked for the Clinton Global Initiative, and Ani Vallabhaneni, an entrepreneur who had launched a chain of dialysis clinics for low-income patients in the Philippines. “We started batting around ideas in the car,” Stradley says. “Even in that first conversation the kernel for Sanergy was there.”

As first years, the trio audited MIT’s Development Ventures course, which brings top-notch students from surrounding schools together to create businesses focused on positive social change. Here, they laid out a framework for Sanergy. “It gave us the space and the impetus to put our ideas on paper and get feedback,” Stradley says.

That idea involved tackling a messy problem: the billions of people worldwide who lack access to toilets. They homed in on Kenya–dubbed “the Silicon Valley of shit” in reference to the flurry of startups offering creative alternatives to pit latrines and flying toilets, plastic bags used as makeshift facilities. Their solution called for franchising pay-per-use toilets to local entrepreneurs and then selling the waste as both energy (biogas) and fertilizer for Kenya’s robust flower industry.

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In January 2010, they flew to Kenya to scope out ground zero for their startup. Convinced they were onto something, the team brought in MIT civil engineering undergraduate Joel Veenstra, who grew up in East Africa, and Nathan Cooke, an MIT design instructor, to build out prototype toilets for testing that summer. The positive response sealed the deal–they were starting a company.

Instead of interviewing for consulting gigs or swapping business cards at cocktail receptions, the three MBAs spent their second year perfecting a business plan and filling out entry forms for startup competitions. Their strategy proved successful. Sanergy claimed top honors in Tufts $100K Business Plan Competition, the Walmart Better Living Competition and the Global Social Entrepreneurship Competition. At MIT’s 2011 $100K Entrepreneurship Competition, they bowled over the competition and nabbed both the $100,000 grand prize and the audience choice award. Vinod Kholsa, founder of Sun Microsystems, is said to have been so impressed with their pitch that he slipped them a business card after the presentation. “You felt like the star quarterback after winning a big game,” Stradley says of the barrage of back-slapping and kudos from her MIT classmates. In the summer of 2011, with their winnings and freshly minted diplomas, the MIT founders packed their bags and relocated to Nairobi.

Since then, Sanergy has picked up steam and now boasts a network of some 220 toilets that serve more than 10,000 daily users. They’ve also scored two of USAID’s prized Development Innovation Ventures grants.

But the journey hasn’t been all cheering crowds and oversized cardboard checks. “To be an entrepreneur, you have to be eternally optimistic,” Stradley says. “You’ll find yourself setting goals that are probably unrealistic, and that can be stressful.” But starting a company in B-school can help take some of the pressure off. “As a student you just have unparalleled access, and as soon as you graduate, you’re supposed to be making money or taking a job,” she says. “But if you have a great foundation, the more likely you are not only to succeed, but also to actually start.”

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