The Disruptors Extended Ebook Edition

Social entrepreneurs reinventing business and society

Kerryn Krige, Gus Silber

• Publisher: Bookstorm
• Year: 2016
• ISBN:
  9781928257264
• Edition: 1
• Topic: Economics
• Subtopic: Sustainable Development
• Index: Economics

Can business change the world? Can the world change business? For a new breed of social entrepreneurs, striving to build and grow enterprises that fight social ills, foster opportunity, and help to improve society, the answer is not can, it's must. Impassioned by purpose, driven by dreams, emboldened by ideals, social entrepreneurs imagine a better way to a better world. And then they go out of their way to bring it to life. In the process, they shake the dust off old ways of thinking and disrupt the way business has always been done. In this book, brought to you by GIBS, a leading business school based in Johannesburg, South Africa, you'll get to meet The Disruptors. Through these tales of daring, struggle, triumph and innovation, you'll see the world through the eyes of a diverse range of social entrepreneurs, and learn their secrets for changing the world by changing business. From healthcare to mobile gaming, from education to recycling, from dancing to gardening, these are the game-changers, the difference-makers, the doers of good. Here are their stories.

NAVIGATING THE GREAT UNKNOWN:
STRATEGIES AND APPROACHES OF SOCIAL ENTREPRENEURS

SPARK SCHOOLS

SPARK OF A REVOLUTION

When their MBA lecturer challenged them to think of a way to solve a national crisis, Stacey Brewer and Ryan Harrison put their minds into gear, and came up with a whole new school of thought

Early on a weekday morning, the sun casts its get-up-and-glow on the quadrangle of a primary school in Ferndale, Gauteng. In their uniforms of navy blue and light khaki, worn with sporty white takkies, the children peel themselves away from the clamber gyms and tyre swings, and drift into line on the AstroTurf. They form two loose, chatty battalions, facing each other, with their teachers occupying the gulf in the middle, ready to orchestrate the ritual that kick-starts the day. Like the crackle of a fuse, a quickening trip-beat blares through a speaker, igniting a pledge that booms from a whisper – “I choose, I choose, I choose, to dance, dance, dance, dance” – into a skyrocketing chorus of affirmation: “I throw my hands up in the air sometimes, saying ay-oh, gotta let go!”

The teachers lead by example, shimmying with hands on hips, waving undulating arms, cupping their mouths to shout it all out. The song is “Dynamite”, by the British singer Taio Cruz, and you’re more likely to hear it at a disco or on a beach than at a school convention. But this isn’t a conventional school. It’s a SPARK school, part of a network of high-tech independent schools, founded by two GIBS MBA graduates, Stacey Brewer and Ryan Harrison, that aim to make quality private education affordable and sustainable for under-served communities in South Africa.

Beneath the laurel wreath of its logo, capped by a trademark symbol, SPARK is a name that flickers with the energy of a match set to kindling. But it has been engineered into a handy acronym too: Service, Persistence, Achievement, Responsibility, Kindness. The ethos of a new school of thought. As the scholars sling their brightly coloured backpacks onto their shoulders and hurry to class, with the melody of morning assembly lingering like a curlicue in the air, it’s clear that learning on these grounds is a lively, upbeat business. In the classroom, where they sit at tables rather than desks, the children are taught basic concepts in small groups, with active discussion encouraged.

Then they move on to laptop-equipped Learning Labs for guided online sessions, using browser-based educational software. A typical school day will include three hours of literacy, 1.5 hours of maths, 40 minutes online, and 40 minutes of physical education. The model, developed and pioneered in the San Francisco Bay Area in America, is called blended learning, and it turns the schoolroom into a place where direct instruction and computer-assisted learning are tightly integrated into the curriculum. So should it be at every school, based on the principle that education must inspire and enlighten young learners, equipping them with the knowledge and skills to construct the livelihoods that will help to build the nation.

But the truth is, the school system in South Africa is in crisis. In a Masters thesis by Stacey Brewer, who graduated cum laude and top of her MBA class at GIBS in 2011, we learn that up to 80 per cent of schools in this country are “dysfunctional”, with specific failings in mathematics and literacy. In her graduation year, fewer than a quarter of matric students earned a good enough pass to get into university. And in a 2015 report by the WEF, South Africa was ranked bottom of class, 139th out of 139 countries, for the perceived quality of its science and maths education.

What hope is there for a generation that struggles to read, write, and work with numbers? It’s enough to make you throw your hands up in the air, sometimes. But as Stacey gazed into the depths of that crisis, she saw the glimmer of an opportunity. To try and fix the system, to reinvent it from the ground up, to start an enterprise that would make a profit and a difference. Less than a year and a half after handing in her thesis – “A Sustainable Financial Model for Low-Fee Private Schools in South Africa” – she had co-founded SPARK Schools and launched the first SPARK school in Ferndale, with 160 students in Grades R, 1, and 2.

By mid-2015, there would be four schools in the network, with more than 1,000 students and 100 teachers in total. Another four SPARK schools opened in early 2016, in Gauteng and the Western Cape. In the next ten years, the company aims to be running 64 schools, catering for 64,000 students. That’s not a learning curve; it’s a rocket with its tail on fire, and it suggests a growing demand for educational options outside of free government schooling.

But it also tells a tale of hard work, initiative, vision, chance and timing that began in the age-old way, with a lecturer throwing down the gauntlet to his students. “It was Professor Adrian Saville, who was my first lecturer at GIBS,” recalls Stacey. “He was going on about the state of education, and I think you get protected from certain parts of society in South Africa, because I had never realised how bad it was. He started showing us the stats and pretty much challenging us, saying, if you guys are going to be the future business leaders of this country, what are you going to do to sort it out?”

But Stacey also saw the subtext in that challenge, which was: you can’t hope to solve this crisis from abroad. You’re going to have to stay here, get your hands dirty, and try to make things work. A year ahead of her on the MBA course was Ryan Harrison, a friend from her days at Rhodes University in Grahamstown. She graduated with a Bachelor of Science in Human Kinetics and Ergonomics; he had a Bachelor of Social Science, along with a postgraduate diploma in Media Management.

Like many young South Africans, restless, curious, eager to see the world, they headed overseas after graduation, on what is jokingly known as an LSD: a Look, See and Decide. Ryan worked as a systems analyst in Canada, while Stacey, who admits she has never put her degree to practical use, worked in project management and hospitality. That was enough to land her a job as an onsite manager for a catering company at FIFA headquarters in Sandton, during the hype-and-glory days of the 2010 football World Cup. But her greater goal was to leave home for good.

“I thought, this is my opportunity to get a Masters and then, to be honest, to go back overseas. I went straight into the MBA, and my whole life turned in the opposite direction to what I had imagined.” At GIBS, she crossed paths with her prodigal friend, who had managed to secure a small scholarship to study, which he smartly used as collateral for a loan from his dad.

“My dad is a banker,” says Ryan. “I think he has had one job and one job interview in his whole life. I said to him, this is a once-in-a-lifetime opportunity, will you allow me to stay at home again and subsidise my fees? He agreed, luckily.” As it turned out, the investment paid off. Today Ryan is the Chief Operating Officer (COO) of eAdvance, the holding company of SPARK Schools, and Stacey is the CEO. They sit at a boardroom table in the SPARK school in Bramley in Johannesburg, with bottles of SPARK-branded water in front of them, and it is as if, for once, they have a golden moment to sit back, take a deep breath, and reflect on the road they have travelled.

Ryan wears black trousers and a chequered shirt with the sleeves rolled up. Stacey wears a black skirt and a frilled top, offset by a diamond pendant. Despite being business partners, they are still good friends; despite being good friends, they are still business partners. They are yin and yang, two sides of the same coin, with a calm intensity and a jigsaw of skill sets that has made them an attractive proposition for venture capitalists and corporate funders.

“I don’t know how people start companies without a partnership,” says Stacey. “It is such a hectic journey and you have your highest highs and your lowest lows. We hope, Ryan and I, that we balance each other out. It is also awesome having a female and male mix, because going into meetings, people respond to us differently, so one can pick up when the other keeps quiet.”

They recall an early meeting with a private investor – one of the unexpected benefits of an MBA is that it plugs you into a network of people who know people who know people with money – and he bought in to their vision despite them having nothing to show for it; no proof of concept, just the stirrings of an idea for a school. “We spoke to him for about 15 minutes,” says Ryan, “and he obviously saw a spark, I don’t know. We didn’t even have a name then. He just believed that we needed an investment in education.”

The MBA helped, says Stacey. It proved that they were serious about investing in themselves. It helped too that, from the start, they positioned SPARK as a for-profit business. They didn’t want to rely on donor money. “If you think about school fees, it is value for money,” says Stacey. “We would rather have investors for the long term, who are personally vested to make sure it works, than donors who challenge each mandate. Ryan and I wanted to build something that lives far beyond us, so it is not reliant on us. There was a big push…for profit.”

Ryan winces at the notion that there is any inherent incompatibility between the goal of making money and the vision of making the world a better place. “I believe in impact,” he says. “I think there is a real problem in the industry, where people fool themselves into thinking that they are saviours of society instead of doing something properly. I think that is very dangerous. At the end of the day, if one rand spent creates impact, then I think you are going to get more impact in a full-profit vehicle.”

But back then, in 2011, they were just two students, between careers and opportunities, on the cusp of doing something important with their lives. They were in the same place at the same time, studying the hard science of business administration and the wild art of entrepreneurship. The rest was chemistry, sparked by that professorial challenge – what are you going to do to sort things out? – and the epiphany of the research that opened Stacey’s eyes.

In their school days, both Stacey and Ryan attended private colleges, an option that can easily cost parents more than R100,000 a year in fees. But on the other end of the scale, the dysfunction in the state education system has opened up a niche for low-fee private schools that typically charge a tenth of that amount. Operating from office blocks, houses, and inner-city apartments, these schools are largely non-profit, funded by fees, donations in kind, and government subsidies, often registered as tax-exempt Public-Benefit Organisations (PBOs). But they are not a financially sustainable solution to the problem, says Stacey. “A lot of people are just supplementing the system. They are trying to put a Band-Aid over a gaping wound. It is never going to fix it.”

As part of her research, she analysed ten private low-fee schools in the Johannesburg area, and found that the average annual cost of educating a child was just over R22,000, almost double the government estimate for educating a child at primary school level at the time of the study. “The big finding was that there was no innovation, and quality was often questionable. Where they would actually save money would be to increase the numbers and pay the teachers less. That wasn’t a solution.”

Stacey ends her Masters thesis on a note of hope, positing a model for entrepreneurs to innovate and transform education, and provide a better “passport to the future” for the majority of the population in South Africa. That wasn’t her answer to Professor Saville’s challenge. It was a challenge to herself. Working with Ryan, who had also graduated cum laude, she explored other models of low-fee private schooling in the developing world, including the “slum schools” of Hyderabad, in India, that routinely outperform government schools and have better attendance and resources. But the real answer lay further afield, in the heartland of technology, the epicentre of innovation: Silicon Valley, in California, America. The home of Apple, Adobe, eBay, Facebook, HP, Intel, Twitter, YouTube, Yelp. And Rocketship.

With an introduction from their seed funder, and enough money for six months of research and development, Stacey and Ryan got to know the inner workings of the charter-school network credited with inventing blended learning. Founded by John Danner, a software engineer, and Preston Smith, an elementary school principal, Rocketship opened its first school in 2007, in a church in downtown San Jose. The goal: to provide quality education for the children of low-income and immigrant families, using a model of computer-assisted learning, high-energy rotational teaching, with students moving between spaces and teachers, frequent tests, and a sharp focus on critical thinking and individual data. The school day is longer, too, from 8 am to 4 pm, to allow ample time for “targeted tutoring”, gym, and art and music lessons. Today, Rocketship runs 13 schools in three regions, with academic performance consistently in the top five per cent of district schools in California.

The financial model of Rocketship schools is simple. They are free public elementary schools, serving kindergarten through to fifth grade, with government funding topped by donations from wealthy private individuals. But for Stacey and Ryan, the Rocketship model of education was exactly what they had been looking for. Innovative, flexible, scalable, and adaptable.

“It was so exciting because we could really see how it could relate in the South African market,” says Stacey. “It completely blew us away. When we came back from the States, we decided, okay, we think we have something here, let’s do this full-time. People said it is impossible, there is absolutely no way, you are trying to provide a five-star hotel at three-star prices.”

That’s where the sustainable financial model comes in. Blended learning drives cost efficiencies, says Stacey. She estimates the annual savings on operations to be R1.6 million per school. With initial private funding of R4.5 million,...

Table of contents

• Cover
• Copyright
• Contents
• List of Acronyms
• Foreword by Zanele Mbeki
• INTRODUCTION: On the Flipside of Profit
• Dreaming and Disrupting: The Power of Social Entrepreneurship
• Mind of the Maverick: Personality Traits of Social Entrepreneurs
• Navigating the Great Unknown: Strategies and Approaches of Social Entrepreneurs
• A Global Perspective on South African Social Entrepreneurship
• Bonus Additional Profiles
• References and Further Reading
• Acknowledgements
• Notes on Method