Innovation happens all over the place. While I typically write about innovation in software and the Internet (which are the two areas I invest in), it’s useful to occasionally step back and tell a story about innovation in a different area that I’ve been exposed to.

Peter Frykman was 15 years old when Muhammad Yunus proposed alleviating poverty through the innovation of the social-objective-driven entrepreneur, one who “competes in the marketplace with all other competitors but is inspired by a set of social objectives.” In 2008 Frykman founded Driptech, his for-profit social venture located in Palo Alto, CA, with a mission to create extremely affordable, water efficient irrigation solutions for small-plot farmers in developing nations.

By devising drip irrigation technology that eliminates the complexity of emitters, Frykman and his team reduced the number of parts for a drip system by over 85%, cut the costs typical of commercial drip irrigation by over 60%, and simultaneously improved reliability and ease of maintenance. 

This innovation makes Driptech the first company to design and manufacture drip irrigation specifically for the world’s poorest farmers, allowing them to grow crops year-round while conserving water, labor, and time. Not only can these farmers now finally produce enough vegetables to meet their own families’ nutritional needs, they become micro-entrepreneurs by growing additional crops to sell in local markets, substantially raising their incomes.

But Driptech’s contribution to poverty eradication doesn’t end there. Frykman’s decentralized manufacturing model will deploy production facilities directly to where the product will be sold, allowing for local customization of the systems, additional cost reductions, and added benefit to rural economies through the generation of jobs. The for-profit nature of the venture is not only economically sustainable, but scalable as well, promising future positive social impacts that will grow along with the company.

Having proven his product through a pilot study in India and initial sales in China, Frykman recently raised angel funding to ramp up his manufacturing capabilities. While this isn’t an area that we invest in, I was turned on to Peter via a good friend, Scott Petry, who was the founder of Postini (and is now at Google).  Scott pulled in another long time friend – George Northup – the President of Memeo (Foundry Group is an investor). I find it easy to be supportive of entrepreneurs in social ventures that are supported by good friends.

So, congratulations to Peter Frykman and Driptech. Don’t miss his panel on Social Entrepreneurship at Stanford University’s Graduate School of Business 2010 Conference on Entrepreneurship coming up February 26th from 1:30-2:45pm.