I spoke with Mike Buckler, founder of the app-based giving tool Village X, about his project and what sparked his ideas about development. The story of the app can be found here, but I also wanted to share Buckler’s more lengthy remarks. His experiences from Peace Corps and working with development organizations are the inspiration for the app and what Village X is doing. Below, he explains what drove him to set up his own organization and why locally-led development gets a lot of mention but not much follow through.
What led to the idea of Village X from the standpoint of how it provides money to communities through purchasing decisions in Washington DC?
In a word – sustainability. We could have started as a nonprofit, but we didn’t want to spend most of our time fundraising. We also didn’t want to be beholden to the agendas of institutional donors or to feel undue pressure to motivate individual donors to contribute through campaigns that create unrealistic expectations of impact or traffic in poverty porn. We also wanted to start a movement of regular giving in small amounts. A lot of Millennials, for example, love to give but cannot afford a write a $500 at the end of the year. Shopping lends itself to micro giving because people are already spending on themselves, often on non-essentials.
I see you have what looks like an app that just launched, can you tell me a bit about that and what to expect?
The app will test three hypotheses. The first is that people are more likely to give a few bucks to a cause after they’ve saved a few bucks. Medical research confirms that people get physiological “highs” from getting deals and giving, but no one, to our knowledge, has tested whether these highs are mutually reinforcing. That said, our preliminary testing suggests that users find saving and giving very compatible. The second hypothesis is that individual donors will have a better giving experience when they see live picture updates showing them exactly how their money was used. There’s a lot of anecdotal evidence that this is true, including reports provided by various charities that supposedly link specific giving to specific impact (e.g., reports on sponsored children). The third hypothesis is that individual donors will have a better giving experience when they know what percentage of their donation actually funded direct project costs. One piece of anecdotal evidence supporting this hypothesis is the institutional practice of distinguishing between so-called administrative and programmatic costs. In truth, few people know that most “programmatic” costs are not direct project costs, but that’s another issue altogether.
Our app has three screens – BUY, GIVE & SEE. Users peruse local deals (curated by proximity) on the BUY screen. When they redeem a deal at a partner business, the GIVE screen prompts them to give some savings to their project – it’s tax deductible. The SEE screen is essentially a project timeline, so each user sees updates regarding her project, including notifications that she and others have donated (% funded updates, not the amounts of individual donations), a steady stream of pictures showing project updates from the affected community, and updates from Village X sharing reports (e.g., news stories) impacting the affected community. The app is also integrated with Facebook, so users who log in with Facebook can see who among their friends is using the app and which friends are supporting each of the projects. This way, friends can come together to support a project. The app will also have profiles for users and projects, so users can see their deal and donation histories (handy during tax season) and obtain detailed information on projects and project communities.
Local is still a buzzword in this sector and one that I have seen Village X challenge for its use. What does ‘local’ (or we can substitute grassroots if that is better) mean to you?
Local means having local credibility, respecting local ways of doing things, and putting the needs of local people first. Most NGOs I’ve seen fail at all three of these criteria – they often employ elitist host country nationals or unprepared Westerners, they reflexively criticize practices that they don’t understand, and they dictate the agenda (perhaps based on a donor mandate coming from DC or London) instead of supporting communities’ goals for progress. They frequently fail to appreciate that success in development, like any field, is about establishing relationships of mutual trust and respect. The term “local” is just shorthand for such relationships. That’s not to say that outsiders cannot disagree with local customs or kindly question the status quo; it’s just that the relationship is the foundation for the trust required to make those conversations fruitful. After all, when NGOs leave in their SUVs, communities do what they want.
Why is a community-led and directly-funded project important?
Our approach is informed by grassroots success and failure, gleaned from our firsthand experiences and the experiences of other development practitioners, including many Peace Corps Volunteers. Community-led projects have the highest likelihood of success to cost ratio, particularly when local people contribute their own cash. We like to think of ourselves as investment bankers in villages. Locals spend a lot of time dreaming about how to improve their communities. They know the constraints better than any outsider, and they know most of the potential inputs as well. We can help expose them to new inputs (e.g., inexpensive technologies and training), but, when they have the final decision and do all the planning and implementing, they often excel and develop confidence and local capacity. Unlike with the top-down approach, value remains in the village.
Direct funding is key for not only maximizing village value, but also for providing a compelling experience to donors. Individual donors have shown a strong desire for funding transparency, as demonstrated by the success of Kiva and charity: water. Although neither organization has achieved real-time updates from recipients, each provides some semblance of transparency, albeit often on the backend of the project and with a lot of fine print. Nevertheless, Kiva and charity: water have tapped into a growing sense of frustration among individual donors who know that, while modern technology makes it possible to show exactly how each dollar is collected and spent for relatively little cost, the reality is that most recipient organizations continue to keep donors in the dark.
Similarly, recipients living in local villages want to see where donated money is coming from. Many live under corrupt governments and rightly suspect that much of the development money slated for their needs is diverted into the pockets of well-connected elites. While they appreciate the efforts of some NGOs, they bemoan their lack of control over development projects and marvel at the relative wealth of NGO staff. Connecting directly with small-scale donors in the US is a way for them to bypass dysfunction that, over the years, has undermined local investment. Through telecommunications, they can affordably achieve transparency.
Can you specifically discuss the transparency aspects of the platform? Also, why is that important to include and note when talking about what you are doing?
Transparency is in our DNA. A lot of sketchy stuff persists in international development because it flies beneath the radar. Until recently, it was very hard for well-intentioned donors in the US to know what their charities and government agencies were doing in developing countries. Thanks to the expansion of telecommunications, that has changed. Technology allows us at Village X to cut out inefficient, often ineffective institutions and connect people directly to people. That’s a very powerful, disruptive tool for a human development model that has become thoroughly institutionalized.
Transparency also means that we, as development actors, need to be as honest as possible about our successes and failures. We’ve conducted two pilot projects that have been very successful, but we know that failure will come, and, when it does, we need to celebrate it. We need to learn from the experience and tell our donors what happened and how we are going to improve. That said, we plan to minimize failure by applying lessons learned during Peace Corps to create an incentive structure for local communities that minimizes waste, fraud and abuse. For example, we work through personal recommendations and relationships and plan to stay with communities for 10 years, one project per year, assuming there is no corruption. This allows our users to support the same community for an extended period of time, hopefully witnessing healthy development, but it also encourages communities to play by the rules or risk losing an honest development partner and severing personal relationships.
How did the Village X team come together in the first place?
Since returning from Peace Corps in late 2008, I’ve research and written about international development, in hopes of finding a dignified and effective way to help alleviate the poverty I experienced firsthand as a Peace Corps Volunteer in Malawi. I went back to Malawi in 2009, 2011 and this year – each time, my village looked virtually unchanged since 2006.
I consulted with a lot of people in the multi-billion dollar international development industry, including friends working at USAID and in DC-based NGOs, and, in the interest of full disclosure, I unsuccessfully looked for work in the industry, hoping to get my foot in the door somewhere and parlay that into a conventional international development career. What I realized from research, informal conversations and several informational interviews is that many people on the inside are unhappy with the industry. In particular, people complain about its grant-based or contract-based work and the attendant lack of job security, the disproportionate amount of money being spent on human resources needs of Westerns, and the seemingly disingenuous proposal writing and marketing produced by NGOs competing for contracts and individual donations. A finger is also frequently pointed at Congress, and it’s appetite for conditionality.
One complaint I didn’t hear frequently enough is that too many people in the industry assume that we, as citizens of a powerful and economically strong nation, can effectively orchestrate development, like group of elite scientists building a new polymer. This technocratic philosophy pervades development thinking and, sadly, leads to a lot of bad outcomes when local people, the purported beneficiaries of the inventions, don’t cooperate. This flawed mindset also leads many in the industry to justify its liberal spending on getting to the problems on the ground, a sum that, ironically, dwarfs spending on actually solving the problems. Why spend on local people when they don’t know anything about development or economic growth?
Perhaps most disturbing, we now have 40 years or so of data on international development that fails to demonstrate a correlation (much less a causal link) between aid money from wealthy nations and economic development. In recent decades, quality of life for poor people in many developing countries has improved significantly, but, to my knowledge, there’s no clear link between that improvement and the efforts of the international development industry. Instead, proliferation of low-cost technologies (e.g., mobile phones, vaccines) gets most of the credit.
So, after all the research and resulting litany of critiques, what’s the solution to the poverty problem? I think the only honest answer is “I don’t know.” But, in that answer lies a powerful truth – it’s actually impossible for us, as outsiders, to know. It’s also impossible for many host country nationals living privileged lives in the city, profiting not from their own business acumen or public spiritedness, but the abundance of well-intentioned but poorly administered aid money. Whether in this country or abroad, really knowing what poor people endure requires living as a poor person for an extended period of time – complete immersion. While Peace Corps Volunteers often don’t achieve this ideal, they come much closer than any other international development workers I’ve seen, save a few, village-based, long-term religious missionaries. Volunteers emerge from service with an abundance of wisdom, but they lack policy influence.
Enter Village X – my proposed solution to the problems above. Village X is basically the qualitative and quantitative inverse of the status quo.
- Status quo efforts are orchestrated by donors from above, with little or no input or money from recipients; Village X puts individual villages in the driver’s seat and requires them to invest their own time, money and materials in achieving solutions of their choosing.
- Status quo efforts spend most of their budgetary allotments on the human resource needs of city-based employees (e.g., salaries, offices) and infrastructure to oversee village-based projects from the city, without sacrificing comfort (e.g., fleets of SUVs); Village X has a very light footprint (no offices or SUVs), leverages mobile technology to cut costs, and, when we travel overseas, we use local transportation, just like our hardworking recipients.
- Status quo efforts rely upon grants from institutional and individual donors; Village X sustains itself by running a for-profit business in the US (promoting local businesses) and partnering with a related nonprofit to administer voluntary project donations from shoppers.
- Status quo efforts trumpet the virtue of scale; Village X recognizes that sustainable scale is possible only when organizations take it one village at a time, appreciating the distinctiveness of each place.
- Status quo efforts lack transparency regarding how donated dollars are spent; Village X achieves complete transparency for each donation by providing live mobile updates of the project supported by the donation. Seeing is believing.
- Status quo efforts act as gatekeepers, separating donors and recipients, and using marketing to fill the void; Village X connects donors directly to the places and people helped by their donations.
- Status quo efforts encourage the bully pulpit of famous celebrities who purport to speak on behalf of those in need; Village X has celebrities, too: hardworking local people who are perfectly capable of speaking for themselves through words and actions.
Applying these contrarian principles, I spent several months in 2013 designing the nuts and bolts needed to make Village X sustainable, efficient, dignified and effective. The basic idea is that people in developing countries can and should solve their own problems, working within local cultural and political structures, which often function quite well. The key ingredient local people often lack is targeted financing. Yet, financing for big projects (e.g., roads) should come from governments; when financing for these projects comes from NGOs, local politicians get a free pass on doing their jobs and usually some extra money in their pockets. To avoid this trap, Village X decided to focus on small-scale, community-led projects. To collect donations, Village X will introduce a mobile app that makes it easy for people to save money at local stores, give some savings to a project of their choosing, and see the impact of their giving through live mobile updates provided by recipients. Market research supports this approach – the digital deal industry will double over the next four years, and, while 90% of shoppers are influenced by giving campaigns, 66% want more information regarding how their dollars are used to help others.
In late 2013, I met three Returned Peace Corps Volunteers from Ghana who expressed interest in helping me get the company off the ground. A fourth, who served in Guatemala, started helping this year. We’ve been working nonstop ever since, bootstrapping a lean startup with big dreams and a very small budget. It is truly a project of passion.
The road has been intense and exhausting. After forming Village X (a social enterprise) and Friends of Village X (associated 501(c)(3) nonprofit), we travelled to Ghana and Malawi to receive direction from villages. The response was overwhelming – altho.ugh local people are accustomed to NGOs doing things for them, they preferred to do things for themselves. The mobile phone aspect takes some getting used to, but mobile phone prices are plummeting (about 30% per year in Malawi), and mobile Internet usage in Africa will increase 20 fold over the next five years. After returning to the US, we ran an Indiegogo campaign that raised about $32,000 to build our first technology offering. This fall, we’ve built the technology with Big Room Studios, a tech shop in Portland, Maine, and recruited partner businesses in Washington, DC (we now have 12). We plan to launch the technology with about 15 partner businesses in DC in December of this year. In January 2015, we plan to offer an online marketplace that allows users to BUY for less, GIVE a little, and SEE impact, just like the app.
*Note re the above: I deeply admire and respect the well-intentioned men and women who work in international development. My critique is aimed not at them per se, but the system in which they work. To avoid criticizing the system for fear of jeopardizing personal relationships would be an injustice and, given what I’ve experienced, a moral failing. I hope that my words are interpreted as a call for change, not an unequivocal rebuke.
It seems like your collective experiences volunteering in sub Saharan Africa significantly influenced your way of thinking about development. What did you learn?
My development philosophy is definitely informed by what I saw during Peace Corps and, additionally, what I didn’t see. I saw the problems described above, but I didn’t see things getting better for my community or the communities around me. I lost students and colleagues to treatable diseases; I cringed at the sight of malnourished children and crippled adults. Yet, among the local people, I also saw a lot of grit, resilience, community spiritedness, and intellect. It was clear that these folks were victims of circumstances beyond their control. It was also clear that very few international development decision makers took local people seriously. They were viewed as a problem to solve, not a resource to embrace.
The most important thing I learned in Peace Corps is that people make sense when you take time to understand them. Within the context of their everyday environments, and personal histories, people generally exhibit behaviors that seem appropriate and understandable, if not rational. Taking the time to understand them is hard and involves literally walking in their shoes and studying their environments, including language, culture and history. It’s grueling, but the resulting enlightenment is worth it.
What mistakes did you make when starting out in the Peace Corps? Is there a way to prevent others from making the same mistakes, whether they are a new PCV or an aid worker?
I think Returned Peace Corps Volunteers are incredibly valuable because of all the mistakes they’ve made during service. I’ve definitely made my fair share. For example, because I left a professional career to join Peace Corps, my expectations for service were very high. I knew that it would be hard and that I would struggle, but I didn’t realize the extent to which I would make the experience about me, instead of the local people. My identity was (and still is, to some extent) tied to my perceived productivity and sense of accomplishment as a worker. When things didn’t move quickly in my village, I got frustrated. Sometimes that frustration manifested itself as judgment over the perceived dysfunction of local ways. The design of Village X definitely reflects the realization – a product of a lot of introspection on my part – that what I think really doesn’t matter and, frankly, shouldn’t matter. I don’t live in villages fulltime, and I cannot solve problems for others, regardless of how much my ego would like to try.
My biggest mistake was obtaining USAID funding to create a girls’ boarding school at the secondary school where I taught. It’s a complicated story, but I’ll try to keep it short. Our campus was undergoing a prolonged renovation funded by the African Development Bank (ADB). The girls’ boarding school planned to use some older buildings rendered obsolete by new buildings constructed during the renovation. Two problems arose – plagued by corruption and mismanagement, the ADB took about 7 years to build the school (to my knowledge, handover still hasn’t occurred), and I pushed the boarding school project forward, at the community’s urging, despite resistance from a government official. In the end, the official won, and I left. The project might yet get built, but two dilapidated buildings – a kitchen and a bathhouse – stand as monuments to another failed development project.
That said, I did a lot of things right. In particular, I exposed the community to guacamole, which will likely be my enduring legacy. Who knew that guacamole was so universal? I also helped students plan and water trees across a barren campus. Today, the trees are large, lush and gorgeous, and provide students a lot of shade for socializing or studying outside the classroom. Finally, I made a lot of friends, and those relationships endure. Village X would not be possible without my network of Malawian friends.
Will there be a way to give directly to projects?
Yes, each user will be able to select a specific grassroots project and give directly to that project over time, until the project’s budget is full. As soon as a user gives to a project, she receives live mobile updates regarding that project. After accounting for credit card and money transfer fees, we plan to pass 80-85% of each donation to the ground for direct project costs. The rest will be used to pay admin expenses and the salaries of our country representatives – one in Ghana and one in Malawi.
What do you see as the future of Village X? More simply, where do you see Village X in three to five years?
In three to five years we hope to have demonstrated the appeal and efficacy of our approach. We also hope to have many partner businesses in multiple cities in the US and in our online marketplace and to expand organically on the development side by partnering with more villages and reaching out to like-minded grassroots nonprofits. In my wildest dreams, American shoppers would get in the habit of perusing the Village X app for “good” deals and transparent giving before making any purchase.
We also hope that our success will encourage donors for all organizations to demand complete transparency regarding how their hard earned money is used. Additionally, we hope that NGOs operating in the US and abroad will leverage telecommunications and commonsense to cut costs and streamline programs and thereby deliver much more money to the ground.