Sanergy 2.0: Restructuring to Scale the Circular Economy in Africa

Set in 2023, the case features Sanergy, a Kenya-based social enterprise founded by three MIT graduates. Sanergy's circular sanitation model comprised a not-for-profit toilet unit, which provided safe access to sanitation and waste collection, and a for-profit agriproducts unit, which treated the waste and upcycled it into saleable organic products. Ten years after Sanergy's 2011 launch, cofounders David Auerbach, Lindsay Stradley, and Ani Vallabhaneni decided to split the two business units into distinct entities--Fresh Life (the toilet unit) and Regen Organics (the agriproducts unit)--that would operate under a new umbrella platform called The Sanergy Collaborative. Both units had high growth potential, but operating under the same brand name had impeded their ability to pursue strategies suitable for their distinct business models. This split would allow each entity to scale and explore opportunities that the sanitation value chain had unlocked in related domains. Although the new structure held clear benefits, it raised concerns, too. Would the enterprise be able to strike a balance between generating profits and creating impact? Most important, would Fresh Life and Regen be able to establish credibility among key stakeholders in the industry? Should the two organizations align their missions to leverage synergies, or should they forge their ct enterprises like Sanergy could adopt.