According to the World Bank & the World Health Organisation (WHO), chronic malnutrition is both the greatest source of poverty and the greatest cause of child mortality in the world. Overall, chronic malnutrition is irreversibly damaging 200 million people worldwide.
Dr Steve Collins worked in many of the worst famines of the 1990s as a medical doctor, during which time he pioneered new methods for treating and preventing malnutrition. His community-based treatment model has been endorsed as best practice by UNICEF, the WHO and World Food Programme, and has been rolled out into 65 countries across the developing world. A social entrepreneur, Collins is the founder of Valid International and Valid Nutrition, helping spread his treatment models on a global scale. He received an MBE for services to humanitarianism in 2001, and was elected as a senior Ashoka Fellow in 2009.
He spoke to us about the challenges of innovating in the humanitarian sector, and shared some lessons learned along the way.
How would you frame the problem that Valid Nutrition is working to solve?
Chronic malnutrition affects millions of children globally, and if it’s not prevented by the age of 2, it leads to irreversible physical and mental damage. This means that children grow up with sub-optimal cognitive and physical abilities, leading to shorter, less productive lives, filled with more ill health.
The disease is preventable but the scale of the problem means that to date, the public sector and social sector solutions have not been able to make any impact at real scale. At Valid Nutrition & Valid International, we aim to generate evidence on how public/private partnerships can impact on chronic malnutrition on a global level.
Can you tell us a bit about the origin story?
During my medical studies, I became involved in the famine response to the Ethiopian/Sudanese famine of 1984-86. While observing inefficiencies in the international aid model, I realised that the most effective solutions for treating disease involve the community: so-called demand-driven solutions.
After I qualified as a medical doctor, I worked in the Somali famine in 1992. A key thing I observed was that there was no data being gathered by the programme staff because they were too busy supplying services. This struck me as a major limitation, so I began collecting data on all the adults we treated. A couple of months into the study, I changed the patients’ diets to incorporate recently published international recommendations. Mortality rates in the Somali camps dropped from 75% to 20% almost overnight.
I started Valid International in 1999 specifically as a platform from which to test and refine community-based demand-driven solutions to severe starvation. After several years of successful research, I started looking at retail-based public/private solutions to malnutrition, which led to the founding of Valid Nutrition, in 2005.
Valid International and Valid Nutrition are separate organisations working in the same field. How are they different and how did the models evolve?
Valid International’s business model is to provide research & consultancy to improve the programmatic aspects of nutritional delivery and care. We work with a wide range of national governments, donors, UN organisations NGOs and commercial businesses.
Valid Nutrition (2005) is a social business, designed to manufacture and sell Ready-to-Use-Food (RUTF) products – calorie-dense oil-based pastes with essential nutrients to treat malnutrition. The organisation is a charity but it operates as a fully-fledged commercial business, manufacturing, selling and generating revenue, with the only difference being that all the profits generated are reinvested into expanding the mission.
My developmental philosophy is not to import solutions into the developing world, but to add value to local industry wherever possible, and to that end we only set up manufacturing plants in countries affected by malnutrition and wherever possible try to use ingredients grown in those countries.
What are some of the challenges you faced in your early years? Can you share any lessons learned from addressing these challenges?
Three key lessons stand out in my memory:
Lesson #1: the power of data
In the social sector there is a lot of talk about innovation, but innovation has to come with a scientific, data-driven evidence base, especially because the traditional aid and development sector can be quite conservative.
When we first started Valid International, we came into conflict with the UN and the medical establishment, who didn’t like the idea of taking treatment authority away from doctors and instead putting it with the patients. The only way to overcome resistance was with high quality operational research and evidence. So Valid’s team developed a database of 25,000 cases that we shared with the UN, and which proved to be instrumental in changing their policy.
Lesson #2: reinvention of the funding model
The process of change and innovation is a messy one: mistakes can happen, and in the medical world, when mistakes happen, people die.
Charities are set up to actively promote social good, and as a result, their funding streams heavily reliant on being seen to do good. The difference is subtle but absolutely fundamental. The problem is that this restricts innovation, because it does not allow agencies to be open and transparent about making mistakes.
In a true social business, revenue streams are 100% aligned with social impact. In this model image is less important than actual impact, removing the fundamental contradiction inherent in the charity model.
Lesson #3: size matters
People feel comfortable giving to large, well-known agencies or charities. This results in a few big players calling most of the shots, and because these same players invest hugely in image and profile, it’s quite difficult for small organisations to break into accessing significant funding. For an organisation like us, which is turning over €3-4 million, we require larger grants or investments to expand but we find it difficult to compete with the professional fundraising and grant-chasing machinery set up by the larger NGOs.
I am hopeful that the new breed of social investors, who are purportedly looking at impact rather than profile, will fill a very important gap in allowing smaller, innovative organisations to get revenue. So far, at Valid, we haven’t had much success in this area, which has been frustrating.
What’s ahead for Valid? How are you trying to scale globally?
Three elements are ahead for us:
#1 – We have unfinished business in the treatment of starvation, particularly with India. 40% of the world’s malnourished children live in India, and they are the only major country that has not yet adopted our treatment model. We have been working with stakeholders for several years now and are at the point of a breakthrough: governments in Odisha and Bihar states have now agreed to pilot our treatment approach. The initial data is very encouraging and we are hopeful that once this data is published there should be a large and rapidly increasing demand for these programmes across the country.
#2 – We need evidence to demonstrate that a public/private collaboration selling complementary foods through retail channels can improve health whilst generating a financial return for investors. The 3 dimensions of the evidence we need are: (1) Can we generate demand among low-income consumers to actually part with their cash for our products? (2) Will this have a positive impact on lowering chronic malnutrition? (3) Is it profitable? If we can show that these three are possible, then we have a real game-changer – if you can make money by improving people’s lives then why on earth would you not do so?!
#3 – We have been investing Valid’s own resources in developing new surveying and mapping techniques. At the moment, standard Demographic and Health Surveys (DHS) produce aggregated data that cannot be disaggregated down below district (1 million plus people) level.
We are developing new surveying instruments, generating heat maps that actually will illustrate what’s happening down to a village level form a national survey. Already countries such as Sudan and Sierra Leone and some of the UN organisations are adopting these tools, and we think they will help plan more effective interventions – from both a public and private sector side. So we can identify where demand is, and where best to invest.
Read Dr Collins’s contribution to UNICEF’s flagship research publication "The State of the World's Children 2015" published in November 2014.
This article originally appeared in the online edition of Business & Leadership in July 2015.