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Business Rx: To build a school, this entrepreneur first seeks to build a business

F0under Jacqueline Audigé distributing notebooks and pens to the Cameroon girls who are participating in a Aumazo tutoring program. (Photo courtesy of Aumazo)

This week, a nonprofit with a social mission seeks help building a business to sustain it. –Dan Beyers

The entrepreneur

Jacqueline T. Audigé grew up in a village in Cameroon, but left her native country for Silver Spring, Md. with her family. A decade later, Audigé returned to Cameroon for a visit and was dismayed to see that little had changed – children were still facing the same struggles she had experienced growing up. In particular, girls drop out of school at alarming rates when they start their periods because the rudimentary facilities often don’t even have restrooms.

“I thought, somebody has to do something about this,” Audigé remembers. “But I wasn’t thinking of me; I didn’t have the financial means to do anything.”

She returned to the United States and her graduate program at the University of Maryland, but she couldn’t erase in her mind the images from her homeland. “I said to myself, we always expect somebody else to roll up their sleeves, but why can’t I start something?” So that’s what she did.

The pitch

Jacqueline Audigé, founder and chief executive of Aumazo

“In 2005, I started Aumazo, a 501(c)3 nonprofit headquartered in Silver Spring. The purpose is to build a new boarding high school for girls in rural Cameroon with all the right facilities and provide them with quality education in an environment conducive to learning. To date, we have one phase of the building completed and we successfully fundraised and built a road to the school site. I recently returned from a month-long trip to Cameroon. During my stay, we launched a tutoring program to prepare girls to pass the entrance exam required to enter our high schools in Cameroon.

“Our challenge has been to get the funding we need to complete and sustain the school. In 2013, we established a construction business, ZOMA, as the best possible solution to fund the operating costs of the school once it opens. We purchased a machine to make soil-cement blocks to build the school. Our environmentally friendly interlocking blocks make much better building materials than local alternatives and our buildings are very cost-effective and look nicer. We have completed six housing projects to date. My son moved to Cameroon to head up the construction business. However, we have challenges because we lack the capital to invest in more heavy machinery to ramp up the business.

“We met with the minister of habitat and urban development in Cameroon. He wanted to give us some government contracts for low-income housing developments but we can’t bid for the contracts until we have the proper equipment. As a result, we cannot generate the revenue needed to cover the construction costs of our Aumazo School. Getting our own construction equipment would be game-changing for our ZOMA business– once we have the proper equipment, we can take on more construction projects and generate revenue to complete construction of the school. What are some ideas for meeting this goal?”

The advice

Sara Herald, associate director of social entrepreneurship at the Dingman Center for Entrepreneurship at the University of Maryland’s Robert H. Smith School of Business

“Using the construction business as a sustainable revenue model for the school is the right solution. Figure out exactly what equipment and resources it will take to ramp up the construction business. Then set a specific fundraising goal and a plan to meet it. You have a very powerful social enterprise model. Showcase that social enterprise model on Aumazo’s website and tell the story of how donations will fuel the construction business that will ultimately make the school self-sustaining.

“More people understand social enterprise and really connect with the idea of giving someone a hand up rather than a hand out to meet their fundraising goals. Be specific — for example, state a dollar amount you to need to purchase an exact machine, put a photo of it on your web site and tell the story of how ZOMA will take off and sustain the social mission because of it.

“Traditionally, when you are faced with a pure business problem like ZOMA’s, one of the best routes to go is seeking investment. It can be tricky for social enterprises that have nonprofit status to get investors the way that traditional businesses do. Though I admittedly don’t know much about the local market in Cameroon, you may also consider meeting with a lawyer to explore the possibility of restructuring the way the construction business is set up. There are ways to separate a social enterprise out from a nonprofit, but still keep the two entities very connected. This would give you the opportunity to open up new avenues to get capital: individuals or organizations to invest. Ultimately, if you have a sustainable revenue model – which it sounds like you will have once you can buy the rest of the construction equipment – you could pay investors back with some of those profits. The goal would be to find investors who also believe in what you are doing to be partners in your social mission as well.”

The reaction

Audigé

“We can try your suggestions with the Aumazo website. Recently we’ve been focusing more on the tutoring program on our website. We did have success raising funds for the road project when we set a specific goal and highlighted it on our website.

“I’m not sure splitting ZOMA out from Aumazo would be a feasible option. The tax structures and the way we are recognized in Cameroon are based on very different concepts than those used in the U.S. Separating the social enterprise business out from the nonprofit could create more difficulties.”

Looking for some advice on a new business, or need help fixing an existing one? Capital Business and the experts at the University of Maryland’s Dingman Center for Entrepreneurship at the Robert H. Smith School of Business are ready to assist. Contact us at capbiznews@washpost.com.

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