Zaca Mit $100k Executive Summary Presentation

empowering people through information improving livelihoods through innovation

Scot Frank

[email protected]

Joshua Haynes

[email protected]

M. Ehsan Hoque

[email protected]

Chizoba Nnaemeka

[email protected]

Eric White

[email protected]

• zaca improves rural livelihoods by providing transparent price-information to disadvantaged farmers using mobile technology. • zaca is partnered with ITESM Zacatecas, the leading Mexican technical university and is being incubated at the MIT NextLab. • zaca is comprised of students from MIT, Harvard and Tufts.

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A market failure exists… • Agricultural middlemen exploit farmers’ information asymmetries to price discriminate and distort economic outcomes. • Farmers lack transparent information and thus have no negotiation power with middlemen. • This perpetual low income leads to workforce emigration and continued low productivity.

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…that has disastrous consequences • Farmers that are living just above the subsistence level cannot afford to be underpaid by middlemen.

, especially in Zacatecas. • Zacatecas has the highest rate of emigration: over 50% of the population has left for the US and 208 communities have disappeared in the past decade. Three-quarters of emigrants come from rural areas. • As the 2nd-most fertile Mexican state, Zacatecas is the bread basket of North-Central Mexico. Agricultural production suffers, which has far-reaching implications. team problem solution technology competitiveness scalability sustainability progression

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The Solution: Transparent Prices • Data on wholesale prices will increase farmers’ bargaining power and eliminate price discrimination. • This will lead to greater incomes for farmers. • zaca collects data on quantity produced, wholesale prices and market prices, and makes data available to all, queriable by mobile phones. 57% of farmers own mobile phones, 100% have access. • This will lead to positive information spillovers and and help farmers coordinate to make supply meet demand.

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The Technology • End-to-end cell phone information system • Unique data aggregation system collects priceinformation from multiple, real-time sources • Works on any cell phones in use today • Statistically-evaluated results are provided in a simple and sensible manner to users via text messages • A modular and inexpensive system readily deploys on basic hardware • Easily maintained with a simple, localized interface • A single, inexpensive computer acts as a regional server to distributively load balance and push content

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The Technology

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Competitiveness • Similar activities: – e-Choupal (India): internet-connected terminals, costing $3,000 - $6,000, are placed in farmers’ homes, farmers can query market prices and other services. Costly, lacks ubiquitous access. – TradeNet (West Africa): inter-national mobile marketplace for agricultural goods. Scaled too quickly, lost steam. • zaca’s advantages: – maximum access via mobile phones and ease of scalability – bottom-up approach to development and implementation – significant support from the leading technical institutes in both the US and Mexico team problem solution technology competitiveness scalability sustainability progression

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Scaling out and up • Scale nationally using the ITESM system to continue promoting agriculture • Build relationships with other government entities, corporations, telecoms, organizations in order to quickly scale up and out. • Substantiate progress, importance and impact thorough econometrically-sound evaluations as a way to increase support and credibility.

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The zaca suite • After creating credible agriculture-related brand in Mexico: o Create products to eliminate lack of transparent information in other commodities markets like handicrafts, fishing, etc. o Using extensible software platform, introduce other services like weather, jobs board, mobile goods exchange, literacy aide, health inquiry, etc., according to user demand.

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Sustainability • After becoming the ‘transparent’ middleman, connect large manufacturers and farmers, sustained by transaction-based pricing system (e.g. Corona). • Work with telecoms to introduce demand-driven SMS pricing (first x SMSes at retail price, next y at discounted rate) and charge marginal service fee.

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Progression Development

Implementatio n

Scale Out

Scale Up

o Work through  Partnership with o Trial roll-out in o Work with ITESM March ITESM system to international  Completed end- o Econometrically scale to other organizations, to-end software sound study to states NGOs and development measure impact o Aggrigate multigovernments to o Community and  Completed state data for deploy the zaca participatory partner inuput enhanced software suite for o Continued needs farmer the poor assessment measurement cooperation o Begin designing  Succesfully fieldand retooling tested new services  Gained tremendous community Adoption Acception Adaptation support Breakthrough Breakthrough Breakthrough

Winter 08/09

Spring 09

Summer 09

Fall 09

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