When anaesthetist Kibret Abebe sold his family home in Addis Ababa to buy three second-hand ambulances, his relatives were worried. Eight years on, his ambulance service – the first in Ethiopia - has saved 40,000 lives and shows the role social enterprises can play in achieving development goals. To reach their potential, businesses like his need support and access to funding.
Abebe saw the need for an ambulance service while working as an anaesthetist at the Black Lion Hospital in Addis Ababa, a city with a poor record for road safety. Many accident victims on his operating table arrived too late to save, having been brought in by friends without any knowledge of first aid or life-saving equipment.
“We are the ones who are healthy and know what to do, but the victim is expected to come to the hospital,” said Abebe. It didn’t make sense. Rather than wait for the government to act, Abebe took matters into his own hands. “95% of people were against my vision,” said Abebe, “but I said no, we can still interfere, and make our drop of contribution to the problem we see.” Thus was born Tebita Ambulances, named after this very ‘drop’ in Amharic.
Since being licensed by the Ministry of Health in 2008, the Tebita fleet of ambulances has grown to 11 and the enterprise now employs 67 people. But the challenges of an unreliable supply chain for emergency equipment, and lack of access to finance, are holding it back from expanding.
“Whenever you go to a bank, they are interested in bringing the money back. Not bringing life back, you know,” said Abebe. What money Tebita does make is then taxed at business rates, limiting what can be reinvested in the enterprise.
The issue is not unique to social enterprises in Ethiopia. According to Paula Woodman, senior adviser on social enterprise at the British Council, social enterprises often fall between two economic stools. “Policies have been tailored for private businesses which maybe face fewer restrictions and are taxed; or you have charities, NGOs and civil society organisations which are often restricted and not allowed to trade,” said Woodman.
“Social enterprises are a hybrid model and as such they fall in the gap between these two statutory legal frameworks. They are private companies but they’re not seeking to maximize profit. They are seeking to build impact internally to their business models - a strange thing to do within the current structures we have in the world.”
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What is a social enterprise?
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Fostering an enabling environment for social enterprises was one of the topics discussed at the European Development Days in Brussels, with a panel focusing on ‘Achieving the SDGs: How can we make business more social?’. Businesses and entrepreneurs have an important role to play in meeting the social and environmental goals of the 2030 Agenda, especially in the context of aid budgets under pressure.
“There are many countries which have taken action to support social enterprise,” said Woodman. “Some, such as the UK and South Korea, have developed a new legal model; others, including Italy, have looked at recognition for social enterprise within existing legal structures. And many governments are looking at how they spend their own money when they’re purchasing a good or service - are they only considering an interested provider on the basis of price and quality, or are they also considering what extra social or environmental value you can offer. There’s an understanding we need to move in a direction that’s about a triple bottom line.”
Woodman emphasized that a range of actions and partners are needed to help social enterprises flourish. Just as “it takes a village to raise a child, it takes a whole ecosystem to raise an entrepreneur,” she concluded at the EDDs. Alongside governments creating supportive frameworks, donors and foundations can play an important role. To learn more about the British Council’s approach, read our blog.
Tebita Ambulance received a grant of $200,000 from USAID and DfID’s Health Enterprise Fund in 2013, along with two years’ technical assistance on financing, strategy and scaling up. “They came to Addis Ababa for a month and studied our costs,” said Abebe. “Before that, we didn’t know – we were pro bono, health professionals, you don’t care about the money - which was a mistake as an entrepreneur.”
They found that each time Tebita dispatched an ambulance, it cost $51. Very few patients had medical insurance, and so the ambulance service needed to come up with a sustainable business model.
“You imagine you go with an ambulance and you ask the family of the patient to pay you out of pocket. It’s ridiculous. If somebody says, ‘I don’t have the money’, you [still] need to save his life,” said Abebe. “Can you make it in monetary value, the value of one person? He may be poor, but his life needs to be saved. So we have a working business model in which we can subsidize these poor people.”
One branch of Tebita’s work is offering emergency aid training to multinational companies. “We’ve given training to more than 30,000 trainees from different organisations, and have distributed a number of first aid kits in cars so they can save lives,” said Abebe. The income from this subsidizes the 24/7 ambulance service. The public pay $15-20 per call-out, and Tebita makes up the rest.
The cross-subsidization model is working, but it does not leave much room for the kind of growth Abebe dreams of. Currently all Tebita Ambulances are sent from three dispatch centres in the capital city, but Abeba wants to open centres in five more towns in Ethiopia to enable faster access to patients in rural areas. After that, he envisions a satellite trauma centre, an air ambulance service, local manufacturing for emergency medical supplies, and a paramedic training centre. “But in order to do this, we need technical and financial assistance.”
Examples like Abebe’s highlight the potential contribution of social enterprises towards the SDGs.
In the meantime, Abebe’s family and friends have come round to his vision. “I always say life is not about having a house and a comfortable life, it is about committing yourself to your purpose,” said Abebe. “I’m on this planet to make a difference to the emergency medical service system of my lovely country Ethiopia. [And] I bought the house back for my family, and they’re comfortable, and I’m sticking with my vision still.”
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How is DEVCO supporting social enterprise?
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Group
Public Group on Private Sector, Trade and Regional Integration
Further reading
Q&A with Paula Woodman: British Council's approach to social enterprise and development
Disclaimer
This collaborative piece was drafted with input from Chloe Allio from DEVCO, with support from the capacity4dev.eu Coordination Team.
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