Case Detail

Case Summary

M-Changa: Leveraging Kenya’s Mobile Money Market for Community Fundraising

Case Number: 5-215-252, Year Published: 2015

HBS Number: KEL902

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Authors: Sarit Markovich; Nilima Achwal

Key Concepts

Board of Directors, Competitive Strategy, Entrepreneurship, Growth Strategy, Innovation, International Business, Nonprofit Management, Pricing Strategy, Strategic Alliances, Strategic Planning

Abstract

M-Changa was one of the fastest-growing fundraising platforms in Kenya, allowing Kenyans to use text messages on their mobile phones to send, receive, and track donated funds as well as solicit donations from family and friends. The young cofounders, Kyai Mullei and David Mark, had grown the company quickly by leveraging partnerships with large banks, mobile money operators, and NGOs. By April 2015, M-Changa had a team of five people serving 25,000 users. Now, it stood at a crossroads. M-Changa’s board members had expressed concern that its multitude of partnerships may have spread the company too thin. The board urged Mullei and Mark to focus on the partnerships that would reap the most value for the company in the long run. Should M-Changa pursue partnerships with mobile money operators and banks that made it possible for users to transfer money conveniently and at a low cost, or instead focus on partners that allowed M-Changa to test new customer segments and increase sales? In addition, there was an estimated US$7 billion fundraising market across East Africa, so Mullei was tempted to test neighboring markets. Students will step into the shoes of Kyai Mullei as he and his team refine their partnership strategy at a crucial point in time for the venture.

Learning Objectives

After reading and analyzing the case, students will be able to:

  • Recognize that strategies that increase value creation do not necessarily increase value capture
  • Appraise the value of partnerships with vertical and horizontal players
  • Analyze business models and the required actions needed for profitability
  • Consider the profitability of a one-sided strategy in a two-sided market

Number of Pages: 14

Extended Case Information

Teaching Areas: Strategy

Teaching Note Available: Yes

Geographic: Kenya, Africa

Industry: Financial Services

Organization Name: M-Changa

Organization Size: Small

Decision Maker Position: Founder

Decision Maker Gender: Male

Year of Case: 2015