Totohealth in East Africa: Reaching Financial Sustainability in the Bottom of Pyramid Healthcare Market

Totohealth in East Africa: Reaching Financial Sustainability in the Bottom of Pyramid Healthcare Market

  • Case
  • Teaching Notes
Abstract

Totohealth is a mobile health for-profit social enterprise founded by Felix Kimaru in 2014. The company aims to improve maternal and newborn child health by disseminating accurate, targeted, and timely information through SMS mobile technology. Totohealth developed a mobile technology to allow parents from marginalized African communities to monitor their pregnancies and children’s health, as well as empower them with vital health information. These communities are known in economic terms as the bottom of the pyramid (BOP) market, consisting of those who live below the poverty threshold.

The case focuses on a dilemma that Felix Kimaru encountered in the early stages of developing Totohealth’s business model. At its inception, Totohealth delivered the service free in order to test the market and receive feedback. Next, the company adopted a business model that included multiple revenue streams in order to reach financial sustainability. Felix targeted hospitals and NGOs, which paid for poor people who could benefit from the service. However, the limited funding of these organizations thwarted Totohealth’s expansion and its break-even point remained out of reach.

Felix decided to target the beneficiaries directly as customers, and so Totohealth designed a tailored value proposition aimed at the BOP market. This offer was designed around four principles: affordability, acceptability, awareness, and availability. This new strategy enabled Totohealth to increase revenue and social impact, and continue along the path toward a sustainable competitive advantage in the BOP market.

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