Top Third Ventures

History

Top Third Ventures was founded on 9 November 2011, by Lucas Belenky and Björn Hammar in Nairobi, Kenya. Björn Hammar, a Finnish national, met Lucas Belenky, a United States national, several months before during a professional hiatus while traveling through sub-Saharan Africa. During his trip Björn was exposed to different types of social impact companies operating out of Africa and became particularly interested in social enterprise through efficient cook stoves and carbon credits. A chance meeting with an efficient cook stove designer led to an introduction to Lucas who was a senior associate with KPMG East Africa’s Sustainability Advisory Services at the time. Björn and Lucas had their first meeting at the Westgate shopping mall where they quickly realized they had similar convictions about development, entrepreneurship, and meeting global challenges through enterprise. Their shared belief that a for-profit approach is the most cost-effective way to solve societal problems is embodied in Top Third Ventures.

Originally, Top Third Ventures main business was to design, market, and sell an efficient cook stove with brand name Baker for the rural consumer market in Kenya. Two additional business divisions to grow out of the direct sale of the Baker cook stove: the Business-To-Business division providing other cook stove manufacturers and distributors access to carbon finance and the Big Data division. All three aspects of the business complimented each other and contributed to Top Third Ventures’ vision of widespread efficient cook stove use in the developing countries. The retail sale of the Baker cook stove below cost of production was possible through carbon financing. Top Third Ventures registered the Top Third Ventures Stove Programme, a program of activities under the Clean Development Mechanism of the United Nations Framework Convention on Climate Change (UNFCCC). The programme was registered on 27 December 2012 and allows Top Third Ventures to earn Certified Emissions Reductions from cook stove activities for a 28-year period. To streamline the realization of carbon credits, track sales, and achieve market segmentation, a mobile app was set up on Android and linked to a backend data visualization and data analysis tool. The application is branded Top3 Tracker^TM. Top3 Tracker^TM is available free-of-charge to any manufacturer or distributor of efficient cook stoves. The aggregation of large amounts of cookstove user data is the foundation of Top Third Ventures’ Big Data division, which could grow to cover millions of Bottom-of-the-Pyramid consumers in developing countries.

Top Third Ventures market entry strategy was through its own Baker cook stove. Claesson Koivisto Rune developed the design of the Baker cookstove to emphasize aesthetic appeal, usability, and cultural conformity. In early 2013 the first 200 Baker cook stoves were manufactured In Nairobi and sold through Top Third Ventures’ flagship store in Laikipia County, Kenya. The cook stoves were sold from a refurbished shipping container and the sales team was composed on local village motorcycle taxis that were given sample products. The Baker cook stoves were sold for a retail price of $25. Sales data and customer information was recorded through Top3 Tracker^TM.

After encountering quality problems in the domestically produced Baker cookstoves and unable to raise working capital to establish production overseas at sufficient economies of scale, Top Third Ventures focused on the Business-to-Business and Big Data divisions of the company by working with existing financiers, manufacturers, and distributors of cook stoves around the developing, to provide them access to Top Third Ventures’ carbon credit programme and mobile app.

On 12 September 2012, Top Third Ventures Global was incorporated in Mauritius as a limited liability company. The restructuring reduced the exposure of Top Third Ventures’ operations to political risk from the upcoming Kenyan General Election, 2013.

Business model

Through TTV’s carbon credit programme, Top Third Ventures Stove Programme, registered with the UNFCCC, the company reduces the cost of accessing carbon finance and lowers the time required to certify an efficient cook stove activity for carbon finance. The company’s potential clients are the hundreds entities manufacturing or distributing efficient cook stoves across developing countries. The Top3 Tracker^TM tool is tailored to the collection of Bottom-of-the-Pyramid consumer data compliments the carbon credit programme by reducing the cost of monitoring helps application users scale their business by increasing their understanding of their customer.

Top3 Tracker^TM is a tool for all organizations working with Bottom-of-the-Pyramid consumers, but especially designed for efficient cookstove distributors, to reduce the cost of monitoring and earn carbon credits. The Top3 Tracker is designed by Top Third Ventures.

Top Third Ventures intends to increase access for SMEs and organizations in the cook stove industry to carbon finance by sharing the revenue risk with its clients by receiving a percentage of the carbon credit revenue in return for provided a comprehensive solution that takes the client through every step of realizing carbon credit revenue.

Innovations

1. Top3 Tracker^TM
2. Top3 Data Portal^TM
3. Top Third Ventures Carbon Calculator

The Carbon Calculator is a web application developed by Top Third Ventures to estimate the expected carbon credit revenue for a manufacturer or distributor of efficient cook stoves. The calculator is utilizes MySQL, HTML, and Ajax programming through JavaScript to push and pull data in real-time. An extensive algorithm is used to calculate the expected carbon credits, carbon credit revenue, and Net Present Value of pursuing carbon finance. The Carbon Calculator queries Yahoo’s open currency market API in real-time through Top Third Ventures’ backend solution and pulls the data for every calculation. The input required from the user is limited to the efficiency of the cook stove, projected annual sales, cook stove durability, and country of operation. The Carbon Calculator then presents the user the anticipated revenue and Net Present Value in local currency. The web application is a unique solution that allows everyone to better understand how carbon finance can benefit the efficient cook stove industry. The Carbon Calculator is accessible on Top Third Ventures website

Management team

Top Third Ventures’ senior management team consists of Lucas Belenky and Björn Hammar. They have significant ownership in the company, controlling 46.7% and 43.5%, respectively.