Examining Base of the Pyramid (BoP) Venture Success Through the Mutual Value CARD Approach

Abstract

Nearly two decades ago, Prahalad and Hart introduced the novel idea that large corporations can both serve the poor customers profitably and help alleviate their poverty. However, the base-of-the-pyramid (BoP) field, as it has come to be called, has struggled to deliver on the initial promise and the dual goal of profit creation and poverty alleviation (creating mutual value). While this mutual value is a useful lens to define and evaluate success of BoP ventures, developing a value proposition from the perspective of the BoP has only received limited attention. To address these shortcomings and to extend the way in which success is viewed from the perspective of the BoP, this chapter introduces the mutual value creation, appropriation, retention, and destruction (CARD) approach using the mutual value lens to analyze the success of BoP ventures. It applies the value CARD framework to four different archetypes of BoP ventures to show how the archetypes help identify important differences in the full value proposition for the BoP and the success of the BoP ventures. The chapter illustrates these differences using examples from the field. It discusses the implications of our new perspective on designing BoP ventures that seek to be sustainable over time, and identifies possible avenues for future research to help fulfill the potential of the BoP framework.