Can 'freemium' services pay for small-business training in Bangladesh?

Value Chains

Can 'freemium' services pay for small-business training in Bangladesh?

It's hard to get anything to remote parts of Bangladesh--even information. But one nonprofit is using upsells to get there. Photo: <a href="http://www.flickr.com/photos/39049548@N05/4162422293/">jankie</a> via <a href="http://compfight.com">Compfight</a>.
It's hard to get anything to remote parts of Bangladesh--even information. But one nonprofit is using upsells to get there. Photo: jankie via Compfight.

A new business model pioneered by the IT industry is helping pay to spread information in more old-fashioned ways through rural Bangladesh.

Guardian guest writer Faruk Ul Islam reported this month on his organization's "knowledge bazaars": 30 rooms set up in local government buildings that gather "queries about agriculture, fisheries and livestock and spreading knowledge and skills about best practice – particularly when it comes to the use of technologies."

This basic service is free to beneficiaries, who Islam says are mostly poor, rural and semi-educated or illiterate.

The classic problem with such efforts is the challenge of scale. The best and most accessible knowledge-sharing happens in person, but getting knowledgeable people to remote areas is expensive.

But Islam says his charity, Practical Action, is solving this problem by letting each knowledge bazaar bring in its own revenue. The manager of each bazaar sells "ICT services, photocopying and similar activities," he writes. A team of 12 or so "extension workers" spread through the community answering queries directly -- and paying for themselves by selling "value-added services like crop spraying or animal vaccinations."

If this revenue model sounds familiar, it should. Silicon Valley entrepreneurs call it "freemium"—offering a basic service for free to many people, then charging customers for advanced services once you've built their trust. Here in the States, this is the funding system makes possible web services from Spotify to Dropbox.

Islam says those services don't cover startup and overhead costs, and his group still struggles to sell funders on the notion that rural education is viable. But if Practical Action can make this work, they'll be shoulder-to-shoulder with some of the hottest for-profit startups in the world.

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