What is the social and/or ecological challenge?
In Guatemala, the worst human health and environmental problems stem from housing conditions. The country's housing deficit is more than 1.5 million units, affecting close to eight million people (50% of the population) and causing massive human suffering and environmental degradation, on several fronts. The above figure includes people living in inadequate dwellings without one or more basic services (water, energy and sanitation), in unsanitary conditions and with a harmful, wasteful impact on the environment. Socially, this is one of the main barriers to human development. Guatemala has extensive forest cover and ample water resources, although both are decreasing dramatically and are at great risk. Most people cook with firewood in open fires, causing severe deforestation, which in turn depletes aquifers while respiratory ailments from smoke inhalation have become the leading cause of death. Many people dig unregulated wells and defecate in open-pit latrines, and most piped sewage in the country is discharged untreated into rivers and waterways. Over 95% of rivers are now polluted. Deforestation, water pollution and lack of sanitation are all interrelated, and most households are part of the problem. Much of it can be fixed with proper housing infrastructure that uses natural resources in clean and sustainable ways. There are ample historical and economic reasons for the current state of affairs. Colonial-era governments ignored the development needs of rural areas and left the indigenous populations to fend for themselves, which explains the vast, underdeveloped regions where most people live today. Culturally, there is a tendency to view nature as a provider of free and inexhaustible resources and a public waste dump, with no concern for limits or best practices. This attitude translates into individual and collective behaviours that degrade shared natural resources. Culturally and economically appropriate technological solutions are the best approach to overcoming these obstacles.
The social entrepreneurial approach
CASSA provides sustainable social housing with clean water, clean energy and sanitation. The organisation helps its customers acquire vital services, save money and protect the environment, specifically Guatemala's forests and water bodies. The financial opportunity for CASSA is huge. With some 500 000 households able to afford a low monthly payment on a home, and houses selling for USD 10 000 on average, Guatemala is a USD 5 billion-plus market for CASSA's product alone – never mind the enormous positive externalities and the value of services to save and reclaim ecosystems, which would also amount to billions of US dollars. CASSA customers benefit substantially from their homes – economically, socially, health-wise and psychologically. Economically, monthly savings average USD 50 or more a month, for life, which for CASSA's target group is significant. Socially, many CASSA customers previously without water service or sanitation services benefit from the mobility and integration that comes with having basic, modern infrastructure. CASSA homes eliminate most of the disease vectors that are among the leading causes of death in Guatemala (indoor smoke, lack of safe drinking water). Then, there are the psychological benefits of living in a renewable, safe and healthy home, and they are profound. Our target customers – whether rural or urban – are at the bottom of the population pyramid. They lack a home of their own and live in cramped conditions with extended family, or they rent a place or live in makeshift and inadequate structures that lack basic services. CASSA's target customers make their living in every type of trade. They include agricultural workers, teachers, public servants and micro-entrepreneurs, to name a few. The average income per household (with more than one earner and on average five people) is between USD 300-600. CASSA has established key partnerships with financial institutions, technology providers and customers. Each customer becomes a loyal CASSA ambassador, allowing live tours of their homes and participating in marketing activities (see here and here). On the financial side, CASSA has an agreement with Oikocredit, an international cooperative, to provide customers with long-term micro-mortgages, eliminating a key obstacle for customers to access capital. CASSA also maintains partnerships with all its providers of water filters, water pumps, solar panels, smokeless stoves, and building materials, ensuring that CASSA can deliver its product at all times. Success will depend on the strength of CASSA's organisation. That includes human capital, robust marketing channels, strong partnerships and efficient construction processes. There is ample evidence of need and demand for CASSA's product. To take it to scale, CASSA, having demonstrated the efficacy and impact of its product, now needs additional capital to hire more personnel and launch a wide-ranging and targeted marketing campaign.
Goals and expected impact
We aim to transform the way social housing is built in such a way that the entire market begins integrating renewable and clean water and energy systems into each house. Long term, we want to build 75 000 new homes and retrofit 50 000, which would directly benefit 700 000 customers whose lives will be transformed, create 50 000 BoP jobs, and indirectly benefit millions of people as other market participants replicate our model. Economically, we will create average monthly savings of USD 50 per household (on saved electricity, firewood and water bills), which at 75 000 homes equals USD 3.75 million monthly savings across our projected customer base. The environmental benefits are equally large and probably multiples of the economic savings, since precious ecosystems, waterways will be preserved. Deforestation will halt in the regions where our homes are built, as will pollution of the water table and local streams. We will reduce carbon emissions by 700 000 tonnes per annum.