For climate tech entrepreneur Greg Murray, the priorities are utility, autonomy and adventure.
“We all want to look back when we’re old and gray and feel that we bent the curve on something, that we imagined and delivered useful outcomes to people and created impact. And that the journey was adventurous, full of twists and turns,” he says.
That’s what he’s doing with KOKO Networks a Kenyan-based climate-tech company he co-founded in 2013. Big picture: He’s tackling deforestation and carbon emissions caused by the use of charcoal as cooking fuel in urban homes.
But zoom in, and what his company is really doing is changing the behavior of hundreds of thousands of consumers to improve their daily lives by changing the way they cook.
Discovering a need
Traveling through southern and eastern Africa in 2005, Murray was taken aback by the bags and bags of charcoal he saw on the back of bikes, trucks and piled high on the side of the road to be sold on most city street corners. It was everywhere.
The reason? Charcoal is the dominant cooking fuel in urban Africa. In wealthy nations, cooking energy infrastructure was built with government subsidies. But in markets such as Kenya where that is not possible, people, especially those living in low-income households in dense urban cities such as Nairobi, must find alternative ways to prepare their meals.
“That image stuck with me,” Murray says. Charcoal, he learned, is a USD30 billion deforestation-driven market. “I thought, ‘What if an alternative could be rolled out to undercut demand for charcoal?’”
According to the U.N. Food and Agriculture Organization (FAO), nearly 4 million hectares of African forests are being cut down each year — almost double the speed of the world’s deforestation average — and charcoal is a main driver.
Not only is its production marked by high carbon emissions, inefficient processing technologies and unsustainable tree harvesting practices, charcoal is also dangerous for people’s health. According to the World Health Organization, roughly 600,000 Africans die annually and millions more suffer from chronic illnesses caused by air pollution from inefficient and dangerous traditional cooking fuels and stoves.
Murray and his co-founders wanted to find a safe and sustainable cooking fuel that could be rapidly scaled across low-income tropical forest nations like Kenya.
They hired engineers and invented the KOKO Cooker, a high-power, two-burner household stove — designed in partnership with East African families — that uses liquid bioethanol as a fast, safe, clean and more affordable alternative to charcoal.
But the stove is only a small part of what KOKO does.
Putting energy into the technology gap
Murray says a schism is growing between tech in wealthy markets and those of emerging and frontier markets because technology is typically imported and doesn’t always address the unique challenges and needs of those markets.
“But I’m a technology optimist. I think we build a better place through technology that’s restorative and delivers real value to consumers,” says Murray. “So, for KOKO, the problem we’re actually solving for: Is there clean fuel available every day within a short walk of everybody’s home at a lower cost?”
— Greg Murray, Co-Founder, KOKO Networks share
KOKO is ensuring there is. Each cooker comes with reusable Smart Canisters that consumers can refill — for the exact amount they need — at one of more than 2,000 high-tech fuel ATMs called “KOKOpoints,” which integrate M-Pesa, the Kenyan mobile banking service designed for those who can’t access or afford to bank otherwise.
These KOKOpoints serve households across five cities in Kenya. To service these smart fuel ATMs, KOKO developed a cloud-based software platform that manages the flow of payments, fuel, carbon and data. They also have a fleet of 55 Smart MicroTankers designed specifically to maneuver through the streets of dense Kenyan cities for delivery. KOKO Fuel is delivered in partnership with Vivo Energy Kenya, which owns the Shell-branded fuel distribution infrastructure.
To date, KOKO has sold more than 875,000 cookers, and currently reduces more than 4 million tons of carbon emissions annually, as each KOKO Cooker switching from charcoal prevents the equivalent of five tons of carbon dioxide from being released into the atmosphere. KOKO then sells carbon credits into global compliance and voluntary markets and shares that revenue directly with their customers in the form of low-cost clean energy.
“One of the key metrics that we track is how much of that value is actually going into the hands of consumers, where there is no tradeoff between the commercial objectives and the impact,” says Murray. “That sharing of value is the right commercial decision and it’s by design.”
Though the business of buying and selling carbon credits has its share of detractors, Murray believes it’s a necessary tool that we as a society can use right now to drive decarbonization.
“The answer is not ‘don’t put a price on carbon,’ it’s ‘make sure it’s a bloody high price,’ particularly for energy companies,” he says. “It’s not about paying to pollute. It’s about driving a rapid but orderly transition that will nonetheless take some decades. Right now, 71 nations have compliance and legislated prices on carbon. It’s growing exponentially as a tool for industrial policy.”
Local knowledge, support are critical
One of the reasons Murray was able to cater to the specific needs of the market in Kenya is because he had local experts and business peers to look to for support, including a range of YPO members from Nairobi who were early investors in KOKO.
Unlike foreign investors who would need to be brought up to speed on the intricacies of how retail, financial services, culture government and politics all operate in Kenya, the investors Murray connected with through local YPO chapters came with extensive knowledge of the region. So, when it came time to raise capital, they provided thoughtful diligence checks and offered on-the-ground feedback, taking the cookers to their own employees to simply ask, ‘would you use this?’
“I learned so much from them. There’s just such a wealth of context they have about that part of the world that we’re operating in,” he says. “And they’ve participated in venture capital and technology companies around the world, so they could see something that had legs in their own backyard. They’ve been great support in a lot of the ups and downs.”
Downs include launching a product manufactured in another country (KOKO Cookers are made in India) as a global pandemic shut down country borders and workplaces. And, that product runs on a substance (bioethanol) that was in high demand to produce hand sanitizer.
The ups? KOKO’s growth year-over-year. Currently more than 30% of all homes in the greater Nairobi metropolitan area are using KOKO stoves. The first 10% of the market took two years to cover, but the next 20% of the market came in just one.
Changing behaviors is mutually beneficial
KOKO’s founding investor and largest shareholder is CleanStar Ventures, a venture development partnership and investment holding company that leverages business and technology innovation in frontier markets, which Murray co-founded and serves as Managing Partner. To Murray, business is meant to make a difference in people’s lives.
“If you go back to the origins of capitalism, there didn’t used to be a trade-off between making money and delivering impact. You provided goods and services that were valued by the market and were fundamentally useful,” he says. “Somewhere along the way, in the last 50 years, the purpose got switched, and people started to say we’re going to go into business to make money.”
Murray’s goal for KOKO is to expand its footprint in Africa, as well as in Southeast Asia and Latin America. Already, in partnership with Dalberg Ventures, they have signed an investment agreement with the Government of Rwanda and will launch their network in Kigali later this year.
Right now, KOKO stands as irrefutable proof that business-to-consumer technology companies can be built to provide both the tools as well as the incentives to fundamentally change the behavior of millions in a way that’s mutually beneficial.
“That’s a powerful idea,” says Murray. “It’s just getting things aligned across all the actors in an industry. If you get that design right, you get winners all around. That’s what we love to do and that’s what excites us.”
