Steve Nagai-Ma
steve@flyingbird.us
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Lean For Social Impact:
Innovating for Greater Impact and Scale

Session Objectives:
• Gain an understanding of how to use the Lean innovation
process to achieve more scale and impact
• Learn how other orgs used the Lean innovation process
successfully
• Begin applying the Lean innovation process to your own
organization
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Poll:
What is your comfort level with risk?
(Willingness to invest time & resources on projects that are new,
unproven, and have a high chance of failure)
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Comfortable
with Risk
Not comfortable
with Risk
Somewhere in
the Middle

The Lean Startup/Lean Impact Process:
• Lean is about reducing wasted effort, not frugality
• Involves small scale tests, revising and improving our proposed
solutions based on feedback from real users
• Applies to new initiatives and/or improvements to existing
programs
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Focus: South Africa... 40% of young people not employed
Early Learnings (Customer Discovery):
• Young people didn’t know how to connect with jobs or what was
expected of them
• Employers had poor performing staff and high attrition
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Initial Solution:
Connect young people
with jobs that match
their skills. Get
employers to pay for
placements.
Result:
Few young people met
the minimum
requirements for any
job.
Iteration 2:
Train people to be work
ready.
Result:
Employers paid for
trained recruits.
But many employees
quit because they
weren’t prepared for
the rigors of the job.
Iteration 3:
Train people in a way
that simulated real life
job situations.
Result:
Retention improved
but many quit after a
month (folks ran out
of savings).
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Iteration 4:
Encourage employers
to pay earlier.
Result:
Retention improved but
not for people who
travelled long
distances.
Iteration 5:
Only match youth to
jobs that are nearby.
Result:
Improvement for some
but others were
isolated or living in
desperately poor
towns.
Iteration 6:
Partner with employers
that are not location
specific (eg.
international cruise
lines).
Result:
Success! Youth placed
in jobs they liked.
Employers also
satisfied.
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Results:
• Partnerships with 450 employers
• Successfully placed more than 45,000 youth
• Expanded to Rwanda
2022 Goal:
Support 1.5 million work-seekers and place 500,000 (represents 5% of the
target population)
Current Priority:
Scale & Sustainability (high cost per trainee is not entirely offset by employers)
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“We had promised one set of deliverables and found ourselves
delivering something else.
Being very proactive with funders about why a current solution is not
working and what new learnings are emerging from iteration is the
key.”
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“After a few different attempts, we discovered that when we simply
provided a piece of fruit and a peanut butter sandwich, the test
scores went up by a whopping 30%.
Harambee has made over 1.2 million peanut butter sandwiches as a
result of this accidental iteration.”
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Step 1: Establish Guideposts
• Define your target constituency
• Describe the societal problem you are focused on solving
• Set ambitious (but possible) goals for impact and scale
(Note: Do not reference a solution at this point)
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Steve Nagai-Ma
steve@flyingbird.us

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Target constituency:
~17 million Spanish-speaking, working-age, immigrants in the US
Problem:
Spanish-speaking immigrants face a number of challenges including
lower incomes, housing insecurity, and health inequities
Transformational Goal:
Provide services that improve the lives of more than 1 million
immigrants and activate them to drive policy changes

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Think about your organization…
• Who is in your target constituency?
• What broad problem are you trying to solve?
• What are your ambitious, specific goals for scale
and impact?

Step 2: Propose Solutions
With your constituents in the
room (or with their direct
feedback), come up with 3-
factor solutions
Value
Scale
How will it
grow &
sustain?
Do people
want it?
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Steve Nagai-Ma
steve@flyingbird.us
Impact
What positive
change will
result?

Do people want it?
Does it solve a real problem for
your users or enhance their
lives? Who would pay for it?
Value
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Can it scale & sustain?
How will reach your target
constituents and how will your
innovation pay for itself at scale?
Scale
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Sustainable Revenue Sources
• Paying Customers
• Cross Subsidy
• Freemium
• Optional Payments from Users/Pay what you can
• Referral Fees
• Government Policy
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Does it make the
world better?
Will your innovation actually
deliver lasting positive impact?
Are there unintended
consequences?
Impact
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Proposed 3-factor solution: Offer a digital, English
learning program that works as well (or better) than
traditional classes but costs significantly less
19

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Think about your organization…
• Come up with 3-factor solutions that can
potentially offer value, scale, and impact (these
can be improvements on what you currently offer).
NOTE: Ideally, the process of developing solutions
should happen with your constituents

Step 3: Develop Success Metrics
Define what success looks like for your solution through numerical goals
around value, scale, and impact.
When developing key metrics, focus on per user rates rather than gross
numbers
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• Conversion rate
• Engagement rate
• Retention/Renewal Rate
• Viral Growth Rate
• Cost per person served
(includes all operational &
acquisition costs)
• Revenue per person
• What positive impact will our
solution make?
• How deep, wide, and lasting
will the impact be?
Value ImpactScale
Metrics That Matter
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Sample Success Metrics for Value:
• When offered, 50% of immigrants will subscribe to free lessons from
Revolution English
• 25% of subscribers will pay for lessons from Revolution English

Sample Success Metrics for Scale:
• People will pay enough to cover 100% of costs (includes content production
costs, marketing, and collecting payments)
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Sample Success Metrics for Impact:
• Learners who complete 3 months of Revolution English will improve their
English as much as a high-quality, 3-month class
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Think about your organization…
• Come up with success metrics for value, scale, and
impact for your proposed solution.

Metrics are less risky when they are:
• Co-designed with constituents/based on customer discovery
• Based on relevant research, and/or
• Similar to a comparable analog that is already successful
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Step 4: Test/Learn/Respond
Identify your solution’s riskiest success metric, then quickly move through
the test, learn & respond loop.
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Steve Nagai-Ma
steve@flyingbird.us
TEST LEARN
RESPOND

Build a Minimum Viable Product
(MVP) to quickly assess whether
you can achieve your riskiest
success metric.
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TEST

Key Metrics to Test:
• People will pay enough to cover 100% of costs (includes content production
costs, marketing, and collecting payments)
Testing Plan
Run $150 worth of Facebook ads. Send 10 days of content to learners. Try to
convert people into paying customers.
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Get target users to engage
with, use, and/or buy your
MVP. Measure how they
behave.
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Steve Nagai-Ma
steve@flyingbird.us
LEARN

Test Results:
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Pitched 156 learners to sign up for paid tutoring sessions.
• 53 said they wanted to sign up
• 49 got to the online payment processing page
• 0 paid
We contacted 21 folks who didn’t pay
• All 21 seemed legitimately interested in paying
• 12 said they didn’t have a credit card
• 9 said they were uncomfortable paying online

Respond to your data in one of three ways:
• ITERATE: make improvements based
on what you learn, then
Test/Learn/Respond again
• PIVOT: move on to a new solution
because this one won’t fly
• SCALE UP: do this when you’ve hit all
of your success metrics
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RESPOND

Test Results:
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Based on these data, would you iterate, pivot, or scale up?
Pitched 156 learners to sign up for paid, live lessons.
• 53 said they wanted to sign up
• 49 got to the online payment processing page
• 0 paid
We contacted 21 folks who didn’t pay
• All 21 seemed legitimately interested in paying
• 12 said they didn’t have a credit card
• 9 said they were uncomfortable paying online

When you engage in the Test/Learn/Respond loop…
• Move quickly (your success rate is correlated with the speed at
which you Test/Learn/Respond)
• Learn what the solution is through experiments, data, and
actual user behavior
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Steve Nagai-Ma
steve@flyingbird.us

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Think about your organization…
• Describe a quick test to determine whether your
riskiest success metric is achievable.

Step 5: Innovation Accounting
For each iteration of your solution, document what you tested, your
learnings, and what iteration(s) you plan to test next.
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Guideposts
• Constituents
• Problem
• Goal
Solution
Description of
proposed
solution
Metrics
• Value
• Scale
• Impact
Test 1
• Metric to test
• MVP needed
Results
Response
What was
learned?
How will you
iterate?
Test 2
• Metric test
• MVP needed
Results
Response
What was
learned?
How will you
iterate?
Test 3
• Metric to test
• MVP needed
Results
Response
What was
learned?
How will you
iterate?
Test 4
• Metric to test
• MVP needed
Results
Response
What was
learned?
How will you
iterate?

Keys to Innovation Accounting
• Create a dashboard that makes it easy to see your progress
• Gather reliable quantitative data on actual user behavior
• Gather qualitative data to shed light on your numbers
• Run A/B tests and do some math 
• Track your learnings so each test builds on what you learned before
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Iteration 1:
Generate
revenue
through ads
Test results:
Projected
revenue/
user: $0.43
Iteration 2:
Improve on-
boarding
experience
Test results:
Projected
revenue/
user: $0.57
Iteration 3:
Offer 3
lessons per
day
Test results:
Projected
revenue/
user: $0.73
Iteration 4:
Include
interactive
flipcards
Test results:
Projected
revenue/
user: $1.06
Iteration 5:
Optimize
format/design
of lessons
Test results:
Projected
revenue/
user: $1.18
Key Metric: Generate $1.25 per user (average over the lifetime of the user)
Iteration 5:
Identify best
content and
offer it early
Test results:
Projected
revenue/
user: $1.28
* These numbers are not exact

Before Innovation
Students Served Per Year: 1,200
Cost covered by philanthropy: $790,000
After Innovation
Students Served Per Year: 1,000,000+
Cost covered by philanthropy: $0
The impact of both programs is a significant increase in English language proficiency
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Steve Nagai-Ma
steve@flyingbird.us

1) Define your guideposts
2) Propose 3-factor solutions
3) Develop numerical success metrics
4) Quickly move through the Test, Learn
& Respond loop
5) Track your learnings until you’ve
validated your model
5-10% of the work
90-95% of the work
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Lean for Social Innovation: The 5-Step Process

A Note About FailureA Note About Failure
Expect that your proposed innovation will fail.
When you fail…
• Fail fast
• Fail forward (learn from failures to get you closer to a successful
model)
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Key Takeaways:
• Propose solutions that offer value, scale, & impact (at the same
time)
• Love your problem, not your solution
• Embrace an experimental mindset and iterate based on what you
learn
• Rate of success is correlated with speed of testing and learning
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Think of a
solution
Build,
launch &
scale up
your solution
Raise funds
to build that
specific
solution
Pray that
your solution
works
Identify a
problem
Raise funds
to experiment
with various
solutions
Test potential
solutions
The Traditional “Waterfall” Approach
The Lean for Social Impact Approach
Keep
deploying
solution
despite flaws
Improve your
best solution
based on
learnings
Scale your
validated
solution to
maximize
impact

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Thank you!
Steve Nagai-Ma
steve@flyingbird.us