Winning The $1 Million Hult Prize: The Ultimate Social Enterprise Challenge

The Hult Prize competition at the Sheraton Times Square Hotel in New York

The Hult Prize competition at the Sheraton Times Square Hotel in New York

A TECH SOLUTION THAT ALSO COULD INCREASE INCOME FOR BUS CREWS

That can be devastating for people who depend on the matatus to get around. “I’ve been the one waiting for the bus. I know what it means for a young student to [miss] class and [not] go home on time,” Ossete says. “I have friends and family who have missed important opportunities because no bus showed up.”

Bus crews, the driver and the conductor, lose out too. They don’t know if there are enough passengers along the route for them to make an income. “They are worried they won’t carry enough passengers along the route,” Ossete says. If they don’t have enough passengers, they might not make enough to cover the rental cost of the bus. Conductors might overcharge passengers who get on. In Kenya, the average minimum wage is around $5 a day, and up to half of that may end up going to bus fares.

If the bus waits for all seats to be filled before kicking off, passengers along the route are stuck in a commuters’ purgatory as packed buses pass them by. Waiting at the terminal for extra passengers costs the bus crews money too, though, since they could use that time to make more rounds. With Magic Bus Ticketing, however, a bus crew can use a tablet app to see how many passengers are waiting on the route. So they’ll take off with a bus that hasn’t filled up, counting on the riders who bought digital tickets. Riders who want to use Magic Bus can text a code to get the fare prices. Then they text again to buy a fare and receive a digital ticket to show to the conductor.

FAVORABLE RESULTS FROM A PILOT ON TEN BUSES

After winning the Boston regional competition, the team crowdfunded a pilot, raising $10,000 and gaining help with travel expenses to Kenya from a couple of early seed investors. A developer in Kenya created the technology platform used for the nine-week pilot. The results were highly favorable: One out of every four commuters who used the service said they saved an hour per one-way trip. The team sold 5,000 booked tickets in nine weeks on only ten buses and racked up 2,000 unique users, with 75% using Magic Bus more than three times. Bus crews can double their income from about $5 to $10 a day through the extra trips they’re able to make because of the app.

Overjoyed with the results, the team then flew to Boston in June for the eight-week series of seminars, lectures and coaching sessions in the accelerator. Their presentation skills got a workout from the formal business plan presentations every Friday.  “The experience tears apart your business model from every single angle and challenges you to look at it from every single perspective,” says Cooper. “One of the things we were looking at was our business model and pricing structure and also looking at the most effective way to scale.”

The incubator is splint into several phases. Early in each of the eight weeks, there is an innovation curriculum with lectures from academics on business opportunity mapping, marketing and strategy. There are evening speakers twice a week, often founders of startups. The student entrepreneurs have unlimited one-on-one coaching, once a week socials to build camaraderie among the competing teams, and, of course, the pitch Fridays.

‘I TOLD MY WIFE TO CANCEL ALL MY TRIPS THIS SUMMER’

“I was more involved than ever this year because the batch was struggling,” concedes Ashkar. “After the first day, I went home and told my wife to cancel all my trips this summer. I told her, ‘I am going to stay with the kids all summer long.’ We are hands on. Every company has a mentor and a coach. Almost all the teams are mentored by others who have already gone through the Hult Prize.”

By the time the Magic Bus team competed in the finals in New York, Ashkar says the group probably went through six or seven pivots through its  formal pitches on eight consecutive Fridays. Still, they walked up on the stage for the six-minute pitch, followed by a Q&A from a panel of judges, with plenty of jitters. “We were very nervous because it’s something we are very passionate about and we wanted to do well,” says Omondi.

Magic Bus was the first of the five teams to present. Each group member took turns during a flawless presentation, then waited in the audience, listening to every other team’s pitch. Several of the other ideas seemed highly promising. Among them was a team that showed off a food cart with a solar-powered charging station for customers’ electronic devices — another way for street vendors to make money. Yet another team came up with a way to vastly increase the recycling of trash in Mexico, while yet another pitched an identification system for poor people using biometric technology.

NOW, THE BIGGER CHALLENGE TO IMPLEMENT

But it was Magic Bus that prevailed. When Clinton strolled to the stage and announced the winner, a shriek could be heard throughout the vast ballroom of Sheraton Times Square Hotel in New York.

The group is already back in Kenya working to implement the idea, with the hopes of spreading it to Uganda and Tanzania. “This is the bigger challenge for us because now we go on the ground and have to do good things,” says Omondi.

Ossete’s advice to others who want to compete in future Hult Prize contests? “Trust your gut. If you have an idea, you should go for it no matter what. People told us, ‘I don’t think it is scalable. I don’t think it’s the right time for Africa right now. It didn’t discourage us, but skepticism is part of the life of an entrepreneur.”

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