Why We Invested: Eneza Education
There’s a powerful — even humbling — lesson for development actors in how the mobile industry has managed to pull off the kind of socio-economic impact that has eluded most development interventions in sub-Saharan Africa. Just ask the financial industry. In less than a decade, fintech innovations like mobile money and pay-as-you-go (PAYGo) financing have catalyzed financial inclusion and access to basic services at an unprecedented rate in the region. Can that kind of impact be replicated in other sectors, like education?
Catalyzing a Paradigm Shift in Education
Despite progress toward universal education, sub-Saharan Africa still has the world’s highest rate of education exclusion. Nearly 97 million children of elementary or high school age are out of school. Several factors are driving this exclusion, but most schools are simply overburdened; classes are overcrowded and learning resources too few or absent entirely. In this scenario, quality inevitably suffers and attendance drops. Nine in ten elementary school students are not gaining minimum proficiency levels and less than two-thirds of enrolled students complete elementary school.
Poor literacy and numeracy combined with high dropout rates spell serious trouble ahead for the region. With the world’s youngest population — the number of under-18s is projected to keep growing and will reach 750 million by 2030 — sub-Saharan Africa needs an education sector that will deliver the quality workforce that underpins real economic transformation. Instead, the current state of the sector suggests that it risks becoming a conveyor belt for labor under-prepared for the demands of the marketplace. That is a scary prospect for the region and the globe, as Africa will host more working-age adults than the rest of the world combined by 2035. Solutions are needed and quickly. That is why we at FINCA Ventures invested in Eneza Education, a social enterprise that is redefining educational access in Africa by developing hardware-agnostic digital education curriculums for K-12 students and beyond.
Meeting Customers Where They Are
Eneza provides a product that offers an affordable, government-accredited curriculum delivered through mobile phones and meant to supplement in-person education as a digital textbook used in the home. The core product is designed and refined for feature phones. While smartphones and web technology present powerful opportunities for transformation, their penetration in sub-Saharan Africa is lagging. Feature phones still dominate the market and they will continue to do so until at least 2025. Optimizing its product for this platform therefore makes both strategic and tactical sense, especially considering that more than 70 percent of Eneza’s customers live in rural areas where smartphones have the lowest penetration. Eneza has already begun to build capabilities to distribute through the digital channels of the future (smartphones, web, etc.), but remains firmly rooted in the present reality of its customer base.
Subscribers to Eneza’s platform can access the curriculum and other resources, engage in near real-time with teachers, participate in reader boards, look things up on Wikipedia and compete with other users. For the local equivalent of $0.10 per week, they get unlimited access to the content on the platform. A flexible and convenient financing model allows users to pay for the service daily or weekly, using mobile money or airtime. All these attributes enable Eneza to impactfully meet customers where they are, physically and financially.
Partnering for Success with Telecoms
In Kenya, where it was founded and has its core market, Eneza is the largest e-learning feature phone-focused platform, marketed locally as Shupavu291 (The word “shupavu” is Swahili for “champion,” and “291” refers to how customers dial *291# to access the service). That distinction stems from Eneza’s effectiveness in negotiating and building relationships with mobile network operators (MNOs). Such relationships are rare, not least because EdTechs are nascent in the region and MNOs want to see a revenue track record first before partnering. Eneza has worked with Safaricom in Kenya since 2013, with the telecom giant not only helping to market the product and collect payment, but also providing engineering tools and resources to analyze the copious data and improve personalization, engagement and uptake. The partnership recently won Best Mobile Innovation for Education 2018 at the Mobile World Congress in 2019. Eneza has begun to duplicate that partnership success in other markets including Ghana and Ivory Coast, and their efforts have earned a grant from the global MNO industry association, GSMA.
Scaling Impact and Opportunities for FSPs
A fit-for-market technology, an accessible business model and a robust relationship with telecoms have given Eneza the legs to scale impressively. To date, the platform has reached nearly 5 million learners in sub-Saharan Africa. But, Eneza’s impact isn’t only in scale. The platform’s content is quality assured thanks to accreditation by the government. That content has been carefully designed to be engaging and facilitate learning, incorporating lesson units, quizzes and assessments. As a result, learners on the Eneza platform score 22 percent higher on national tests compared with their peers. Users rank Eneza highly, with the platform earning a net promoter score of 62, which is considered excellent (Apple, Amazon and Netflix have net promoter scores of 66, 66 and 64, respectively).
Eneza’s success and impact should interest financial service providers. Microfinance institutions and banks, like the FINCA Impact Finance network — which works with a similar socio-economic population segment as Eneza — may benefit by offering education-bundled loan products to the EdTech’s clients. For its part, Eneza could create tailored financial literacy and job training content that can benefit a financial service provider’s existing and prospective customer base. Plus, usage of Eneza’s education platform naturally builds digital literacy, a competence that will ease customer adoption of digital financial services and help to build trust in fintech — a win-win for Eneza users and financial service providers.
It has answered over 1 million questions already to date, but we won’t need Eneza’s Ask-a-Teacher feature to tell us if this trailblazing EdTech can be the company that revolutionizes education across sub-Saharan Africa. We know it can and we are championing its success.