Nedjip (Ned) Tozun is the co-founder and Chief Executive Officer for d.light. Since the company’s founding in 2007, Ned has played a key role in developing the company’s mission and strategic plan, securing private investment from multinational venture capital and social impact funds, designing award-winning products, and establishing worldwide distribution through four international offices. Ned has been recognized by BusinessWeek, Forbes, The Guardian, Social Venture Network, the Asia Society, and the World Economic Forum for his innovative leadership. He and d.light co-founder Sam Goldman have been recognized as Social Entrepreneurs of the Year by the Schwab Foundation for Social Entrepreneurship, top 100 business visionaries creating value for the world by Business Insider, and ELITE Rising Stars by the 21st Century Icon Awards.
Company: d.light
We are thrilled to have you join us today, welcome to ValiantCEO Magazine’s exclusive interview! Let’s start off with a little introduction. Tell our readers a bit about yourself and your company
Nedjip Tozun: My journey at d.light began all the way back in 2007 as a project at the Stanford Design School in a class called Design for Extreme Affordability. Before coming to Stanford, my co-founder Sam Goldman witnessed a terrible incident in West Africa where his neighbour’s young son was badly burned in a kerosene lantern accident. Sam and I shared a fierce determination to do our best to prevent this type of accident from ever happening again.
With this goal in mind, we co-founded d.light and developed a line of affordable, high-quality solar-powered lanterns to replace dangerous kerosene lamps. Over the 17 years that followed, d.light has been at the forefront of deploying decentralised renewable energy products and solutions across Africa, broadening our offerings beyond solar lanterns to include large-scale solar home systems and an array of energy-efficient appliances optimised for solar, such as TVs, fans, mobile devices and clean cooking solutions.
In 2020, we achieved our founding mission to free 100 million people from dependence on kerosene lamps and we’re proud to have transformed the lives of over 175 million people through d.light products since the company’s inception. In the process, we’ve built a beloved brand in Africa and South Asia and ensured the company’s continued growth.
What were the most significant challenges you faced during the scaling process, and how did you overcome them?
Nedjip Tozun: When we founded d.light, we didn’t realise how challenging it would be to commercialise and scale off-grid solar products. For the first four years, I was living in China learning how to make the product with the right affordability and quality, while Sam was in India figuring out distribution and sales.
Shortly afterwards, we expanded our operations to Africa. We quickly recognised that to bring our range of solar solutions to market at the scale that was needed, we had to effectively build three distinct businesses.
First: we had to master how to manufacture durable, high-quality products designed for everyday use by people living in hard-to-reach, “off-grid” communities without access to a regular electricity supply.
Second: with no distribution partners, we needed to build a direct to consumer (D2C) distribution business, which required significant infrastructure with a range of competencies and capabilities.
Third: we knew that solar products were only affordable for our customer base if the payments could be spread out over time – something that we could only address by creating a pay-as-you-go personal finance company.
How did you ensure that your company culture remained intact as your business expanded?
Nedjip Tozun: d.light is a company that’s driven by a clear mission to transform people’s lives for the better by providing safe, reliable, affordable clean energy solutions to households without access to electricity. This distinct vision has allowed us to retain a clear identity and culture even as we’ve grown.
Everybody at d.light – the executive leadership team: the Managing Directors for each country in which we operate: regional managers: and sales agents – believe in this vision. 17 years on from when d.light was founded, we all remain committed to achieving d.light’s goal of transforming one billion lives with sustainable products by 2030.
What strategies did you employ to maintain quality and customer satisfaction while scaling rapidly?
Nedjip Tozun: A key pillar of d.light’s ability to maintain quality during periods of growth is the development of a trusted, in-depth last-mile distribution network that reaches and services all our customers, even those in remote, hard-to-reach locations.
With tens of thousands of sales agents and thousands of retail and after-sales service points, our network is unmatched in deploying solar solutions and appliances deep into rural communities. We’ve invested significant resources in training all of our agents to ensure they provide high-quality service for our customers and properly represent the d.light brand.
What’s also been essential is having durable, reliable products. In the countries in which d.light operates, our products need to work in hot, dusty conditions: and also continue to work even when they’re knocked over or dropped, which can happen a lot. We work closely with our manufacturers to fine-tune each product: we then work across the entire supply chain to optimise the cost and quality of each unit according to our customers’ circumstances. This has been a priority since d.light’s early days.
We’ve worked hard for several years to create the right partnerships and put in place the necessary infrastructure and processes to make this possible. Now we want to continue expanding the d.light footprint by entering new markets and improving the day-to-day lives and livelihoods of more households and communities through access to clean and affordable solar energy.
Can you share a specific turning point that was crucial for your business’s successful scaling?
Nedjip Tozun: As was the case with many sectors, the Covid19 pandemic in 2020 sent shockwaves through the entire off-grid solar industry. We had to adapt our operations and become more resilient and creative to overcome setbacks that included supply chain bottlenecks, inflation and currency devaluations in the countries in which we have a presence.
Despite these obstacles, we found a way to continue to scale up and reach more customers. d.light weathered these difficulties and came out the other side more resilient and with a healthy balance sheet, which is testament to the attitude of everyone across the business and our shared vision to have a positive impact and transform the lives of people through access to clean energy.
How did you manage the financial aspects of scaling, particularly in securing funding and maintaining cash flow?
Nedjip Tozun: The most valuable instrument for ensuring our continued growth – despite the external pressures I mentioned earlier – is securitization, the process of transforming a group of cash-generating assets (or receivables) into an investable security. Investors receive 100 percent of the cash collected from the customer until the investor’s principal plus interest is repaid.
We opened our first securitized facility in Kenya back in 2020. The facility improved energy access, for 1.5M people living off-grid, generated USD$67 million of additional income, and also prevented over 460,000 tons of CO2 emissions.
Since then, we’ve closed securitized financing facilities with the cumulative capacity to purchase USD$718 million of receivables. Most recently, we secured USD$176 million in securitized financing in Kenya, Uganda and Tanzania, which will enable us to transform the lives of millions more people over the coming years, by making d.light’s range of solar home systems and solar inverters affordable and accessible to low-income households and communities without access to reliable electricity.
