Carol hails from Taiwan(left) while Maria (right) is from Hong Kong.

Carol Chyau and Maria So started social enterprise Shokay long before the term became a buzzword in recent years.

Shokay, which is the Tibetan word for yak, is a lifestyle brand that designs stylish products made from soft yak down. By sourcing from Tibetan herders in Qinghai and employing women in rural areas, it helps promote sustainable income in rural China.

Shokay’s work allows indigenous herders to generate more direct income, preserve local culture, promote sustainable usage of the environment and promote community development work.

Carol was in Singapore the past November for TEDxKRP to share her experience.

From inspiration to execution

While doing their Masters in Public Administration at Harvard, the duo decided to put the business concepts they learnt into action. The pair went seeking for inspiration on two weeklong trips in Yunnan, China in January 2006.

While there, they saw a need for poverty alleviation and stumbled upon an opportunity. China has an abundance in yak fiber, which is highly comparable to cashmere. Yet, because of its inaccessibility and lack of visibility in the fashion industry, its great potential was left untapped.

With an idea in mind, Carol and Maria went back to Harvard and entered the Harvard Business Plan Competition with a few friends, coming in first under the Social Enterprise Track. With the money they won, they returned to China and set their hearts on following the Yaks.

Items from Shokay

Right from the start, the cofounders had little knowledge about yak fiber and the textiles industry. Undeterred, they kept going to experts for help and formally founded Shokay in November 2006. Today, the social enterprise has come a long way with over 100 stores in ten countries.

Carol shared with us a few important stories on how her team got the business going with little prior industry and product knowledge.

1) Be a sponge and absorb as much as possible

While they knew that they were risking it with zero industry experience and had no background in fashion or textiles, Carol and Maria never gave up. Instead, they went out of their way to visit a lot to factories and gathered feedback from professionals. They weren’t afraid to get their hands dirty doing research and talked to as many industry experts as possible.

2) Be a detective

Carol likens this process to solving a mystery. “Sometimes all you have are clues. When you don’t understand something you have to ask why. For us, we managed to gather useful information about yak fiber by reading up on Google. For example, while yak fiber is comparable to cashmere, few people know about it.” This market gap was their opportunity.

3) Be an inventor

Carol and Maria spent the last five years experimenting with several business models, figuring out the best way to create their product and bring value to the market. They initially sold only knitting yarns, but decided to move on to the bigger market of scarfs and shawls. They’re continuing to innovate and re-invent their model. “We’re shifting from being a fashion label to ultimately being an ingredient brand. Kind of how the Intel chip is an integral part to a Lenovo laptop,” she explained.

4) Have a perspective of an eagle

Social entrepreneurs have to think about two bottom lines. Sometimes you might get lost along the way, but it’s important for an entrepreneur to have the perspective of an eagle. “When you find yourself misaligned with your original goal, it’s important to recollect your thoughts,” she says.

5) Be yourself

After all the hard work, you have to figure out how to pull everything together and make it work. You have to believe and love what you do.

As Carol puts it, “I’m not doing this because I am more philanthropic than other people out there, nor because I’m particularly altruistic. For me, it’s about a sense of responsibility. I just believe that as lucky as we are to have so much, we should give back even more.”

Closing thoughts

Carol and Maria’s philosophy and sheer determination have paid off in Shokay’s progress. Now, sourcing yak fiber from more than 800 families and having used approximately 2,000 tonnes of yak fiber, it’s plain to see how privileged ones like us can give back so much more if we just took the first step to try.

By creating a market for luxury yak, they hope to generate income for nomadic herders.

This is in addition to the existing ComCare Enterprise Fund (CEF), which has been providing seed funding for startup social enterprises that provide employment and training for poor Singaporeans.

According to Halimah Yacob, Minister of State for Community Development, Youth and Sports (MCYS), about S$10M (US$7.7M) has been granted to support 80 social enterprises so far. About 1,600 Singaporeans have benefited from the work of these social enterprises.

MCYS will also introduce a new category of CEF funding next year for schools to educate students on social entrepreneurship. The money, which will target 70 schools in three years, would be used to fund youth-initiated social entrepreneurship projects.

A study of Singapore youths in 2009 has found that they are increasingly more willing to contribute to society.

This year’s winner of the Social Entrepreneur Award is William Drayton, founder of Ashoka, who was the person to coin the term ‘social entrepreneurship’.

Ashoka was founded in 1980 as a non-profit organization that supports over 2,000 Ashoka Fellows and their social enterprises by helping them scale globally.

Reese Fernandez, co-founder of Rags2Riches in the Philippines, won the Young Entrepreneur Award for her venture which recycles scrap material and transforms them into fashionable handbags, eyeglasses, or wine-bottle holders.

The other winners include: Anneli Hulthen, mayor of Göteborg, Sweden, for the Politician Award, and FOSUN International, for the Entrepreneur for the World Award. FOSUN is a Shanghai-based conglomerate with a wide array of activities such as pharmaceuticals and healthcare.

This is the first time the Forum is held in Asia. It is the first global think tank dedicated to entrepreneurs, wealth creators, and social justice. The founding members are Emlyon Business School in France, KPMG, Singapore’s Action Community for Entrepreneurship, and Nanyang Technological University.

The startup accelerator for social enterprises, located in Boulder, Colorado, is open to applications from around the world.

During the six week program, selected entrepreneurs will receive training and build relationships with 50 mentors, which include the former Managing Director of Investments at Google.org, the CTO of HP, and an entrepreneur who has lifted 19 million farmers out of poverty.

They will also get to meet 20 investment funds, pitch to hundreds of potential investors and partners, and receive legal and design consulting.

Only full-time entrepreneurs running for-profit social ventures are eligible for the program. More on eligibility criteria can be found here. To apply, check out this page.

Also watch this video about the Unreasonable Institute below:

The World’s Most Unreasonable Trailer from Unreasonable Institute on Vimeo.

Vincent is the founder and international coordinator for Citizens for Social Business (CSB), an NGO started in July 2011 that aims to promote social entrepreneurship around the world.

Photo: Vincent (left) at the first CSB meeting in Paris. Courtesy of CSB

They have about 260 members now, and within Asia, they have representatives in Singapore, Malaysia, India, and Japan. 

Inspiration for his current pursuit started when he read ‘Creating a World Without Poverty’, a book by Grameen Bank founder Professor Muhammad Yunus. Motivated to do something about poverty, he was deeply involved in policy-making in Europe, and even helped successfully push through a non-binding resolution to recognize social entrepreneurship within the European Union.

With that achieved, his next step was to promote social entrepreneurship globally. He actually met Prof Yunus to talk about it, and he gave his blessings.

“Our purpose is to become the Greenpeace of social entrepreneurship,” he said. Greenpeace? I asked. You mean the organisation that sends ships in to disrupt whaling fleets?

“Oh, we’re not planning to do any of that stuff. We’re much milder,” he clarified. But there’s no doubt they are equally as passionate about their pet causes.

CSB has a two-pronged approach towards promoting social business. Firstly, they want to encourage governments to recognize social enterprises as a separate legal entity with a separate regulatory framework. And secondly, they hope to get governments to reserve five percent of their international aid fund for social enterprises.

I asked him about how he’s going to make his case.

On the first approach, social enterprises are fundamentally different from other corporate entities, he said. While the latter only has one bottom line to think about, social enterprises have two — profitability and societal benefits. And it goes without saying, social enterprises are largely different from charities — which rely mostly on donations.

Yet, he added that despite the differences, social enterprises are not given a separate legal status that addresses their unique objectives and methods. In Singapore, for example, social enterprises are essentially treated the same as commercial entities, and they have to register themselves as such.

“It’s like how a car is not meant to be driven backwards all the time,” he said, “it may technically work, but its not built to be driven this way.”

On the second approach, he says pouring funds into social enterprises promises better returns. When money is donated to charity, it’s gone. But when funds are poured into a social enterprise, it isn’t a donation; rather, it’s an investment.

He emphasized that both measures does not cost much for the government to implement: There’s no need to raise taxes or generate more revenue. All that’s needed is political willpower.

But while Vincent would no doubt love to directly appeal to government officials about this, he does not believe that it will work. Instead, CSB’s job is to create a network of citizens in various countries who believe in the cause. “They are the best people to appeal to their own government.”

Public education plays an important role in Vincent’s activism, since public awareness about social entrepreneurship is still low. A survey conducted by Singapore’s Social Entrepreneurship Association on 2,000 respondents in February 2010 found that only 13 percent of Singaporeans and PRs are aware of the existence of social enterprises.

In addition, 45 percent incorrectly stated that one of the aims of social enterprises was “raising donations.”

Vincent’s unwavering belief in social entrepreneurship is actually rooted in some realpolitik. Governments, he says, are becoming stymied by political division, economic uncertainty, and mounting debt. As a result, the government’s ability to alleviate poverty and fund social programs will be cut.

“People have to realize that they are powerful. They might have forgotten about it,” he said, adding that social enterprises not only lessen suffering, but boosts the economy by providing jobs and promoting spending.

However, for social enterprises to prosper and succeed, the right environment must be present.

“If you go to the supermarket and you see two different brands of orange juice, one produced by a purely commercial entity and another by a social enterprise, and if the price and quality are the same, which would you choose?” he asked.

The answer, to me at least, was obvious.

They hail from Cambodia, Japan, the Philippines and Pakistan, and address issues like healthcare, distribution of everyday goods to inaccessible places, nutrition in impoverished areas, and clean water supply.

The award was given out by the Schwab Foundation for Social Entrepreneurship, a non-profit, independent organization that advances social entrepreneurship.

The winners are:

Bam Aquino & Mark Ruiz , Hapinoy, Philippines

Hapinoy provides business mentorship, leadership development, and branding assistance to women entrepreneurs who own small stalls in urban and rural areas. These women also get 5 to 15% cost savings and greater diversity of goods through Hapinoy’s bulk-sourcing and supply delivery network.

Lo Chay, 1001 fontaines pour demain, Cambodia

1001 fontaines uses sand filtration and solar-powered water purification technology to provide clean and cheap drinking water to over 50,000 people at US$0.01 per liter. Village entrepreneurs are taught how to maintain the water production site and distribute/sell the water.

Asher Hasan, Naya Jeevan, Pakistan

His enterprise partners with corporations to roll out catastrophic health insurance to low-income workers making less than US$6 per day. Drivers, nannies, cooks, waiters, and security guards can be insured at US$2.50 per month with a yearly coverage limit of approximately US$1,780. Naya Jeevan also value-adds the insurance coverage with annual medical checks, preventive care workshops, and access to a 24-hour medical care and claims assistance hotline.

Masa Kogure, Table for Two (TFT), Japan

One in seven people suffer from malnutrition, while 1.6 billion adults in the world are overweight or have health conditions related to ‘over-nutrition.’ TFT corrects this imbalance by transferring excess calories across the globe from developed countries to developing countries. Corporate cafeterias, university dining halls, and public restaurants serve balanced and healthy TFT meals, donating USD $0.20 per meal to lunches in impoverished African schools.

Full press release here.

Seminar Series

NIEW I INTRO: Understand Who You Are & Unlock Your Potential
When: Sat, 20th Aug, 9am-6pm
Learn the art of seeking out innovative ideas, the fundamentals of building a successful start-up and how to get up to $50,000 seed-funding for your new venture(s).

NIEW II ADVANCED: Create a Sellable Idea
When: Mon, 29th Aug, 530pm-10pm and Tue, 30th Aug, 9am-6pm
Refine your business idea(s) further through an Innovation Tournament (a crowd source methodology) and the application of design thinking and business modelling.

NIEW III PRESENTATION SKILLS: Present Like Steve Jobs
When: Fri, 9th Sep 2011, 530pm-10pm and Sat, 10th Sep, 9am-6pm
Be equipped with the appropriate skills for creating and delivering effective presentations, with a focus on Purpose, Content, Structure and Delivery.

NIEW IV SALES TRAINING: You Are The Best Salesman
When: Wed-Fri, 28th-30th Sept, 9am – 6pm
Adopting a highly effective structural framework used by successful sales professionals, gain an edge over your peers in this interactive workshop designed to give you mastery in sales persuasion.

Process Flow

Interested participants can register here.

According to newspaper Today, they are not the first of such cultural spaces to disappear recently. Blackhole, a community space focusing on music, lifestyle, and the arts, was shut down last September. Evil Empire, an eclectic arts space which holds events like a drawing contest and faux auction, followed suit in April this year.

The main reason Post Museum has shut down was because they could not get enough funding to cover their costs. Besides crowd sourcing, they also earn from their bistro Food#03, an integral part of the venue, as well as rentals from its four studio spaces for artists. Unlike charities, social enterprises need to generate sufficient revenue in order to be self-sustaining.

The co-founders only accept money from donors who give them complete control for their projects. Jennifer Teo told Channel NewsAsia: “For a lot of spaces and…activities and events that get corporate funding, there are always compromises they need to do. We actually don’t. We’d rather not get the money. There’s always a need for people to be independent from greater influences.”

Another reason was the lack of manpower. They were unable to find someone to take over or help manage it.

But we won’t be seeing the last of Jennifer and partner Tien Wei, as they are planning to do one-off events in different venues and countries. The new initiative will be called OutPost.

Photo: An photo exhibition at Post Museum. By Aameerule

Do Business. Save the world. All in a day’s work?

If you have an idea how you could potentially ‘do well while doing good’, or if you already are working to get something off the ground and would like to get additional support and access to a whole ecosystem of like-minded individuals, come join the Rotary Youth Social Entrepreneurship Challenge 2011 (RYSEC).

The aim is to provide a platform for young individuals youth to discuss their exciting and refreshing business ideas, that not only make a profit but also tackle existing social challenges. This competition is in its 3rd year, and a number of alumni have successfully launched (and expanded) their ideas!

Competition Categories

Idea Launchpad
For teams who are relatively new to the concept of ‘Social Enterprise’, and who have a social business idea and are looking to test it.
Project Accelerator
For teams with a mature/in-implementation business concept, and who are looking to meet people and develop networks to bring the idea one notch higher.

Timeline

Aug 6 – Introductory workshop for individuals new to Social Enterprise, with an idea brewing in their minds
Aug 13 – Advanced workshop for individuals who are already working on their ideas, with experienced mentors available for guidance
Aug 27 – Deadline for submissions
Sep 18 – Winners declared at award ceremony
Mid-Oct – Winners go to Philippines

We found it interesting to hear from the perspective of a young entrepreneur from Raffles Junior College. Below are his insights and experiences about entrepreneurship, taken from an article in KWHS (with permission):

“The fun [of being an entrepreneur] lies in the unknown. You wake up in the morning and don’t know what is going to happen during the day,” stated a panelist from the recent Start-Up@Singapore competition for young entrepreneurs. Sitting there with a friend, I was taken with the speaker’s honesty. I had heard this message of uncertainty in entrepreneurship, but never related so directly. Young entrepreneurs in Singapore find the risky nature of entrepreneurship intriguing.

This risk factor can also be a deterrent. Singapore’s Gross Domestic Product [the total market value of goods and services produced by a nation] has grown at an exponential rate for the past few decades. This, coupled with good governance, has propelled Singapore from a third-world to a first-world country. The average income of Singaporeans is now among the world’s highest. In order to maintain this high standard of living, Singaporeans prioritize job security and material comforts above all else. This mindset is then passed down to my generation, where most parents desire their children to work hard, get a college degree and settle down into a secure (and high paying) job, such as accounting or law. This has resulted in a dearth of homegrown teenage entrepreneurs.

My story would have been the same as many of my friends, if not for supportive parents and lessons that changed the way I looked at business and entrepreneurship. Here are three key takeaways from my journey thus far.

Anyone can be an entrepreneur:

My love for business started when I was just 9. I remember my first business transaction with great fondness. There was a craze for erasers with pictures of country flags on them. Everyone in my class was scrambling to buy them from the school bookshop, which was selling them for 50¢ a piece.

I begged my mum for extra pocket money to get the erasers. Agreeing, she bought them from a retail bookstore, mentioning in passing that each eraser cost only 10¢ per piece when bought in a box. Something clicked and I realized that I could sell the duplicates that I had for 40¢, effectively getting an extra 30¢ additional pocket money. I was right. My classmates lapped it up and bought out what I had to offer. I made $6 from those sales, which was big money to me at that time. From then on, I dabbled in more small ventures to increase my pocket money.

Whatever your business venture, stay on the right side of the law:

When I was 14, my classmates at Raffles Institution were growing into young men and needed food all the time. They often grumbled during class that break was too far away. Seeing this, I decided to buy small snacks (Pringles, M&Ms, etc.) directly from wholesalers and sell them to my classmates. It was a profitable business until I realized that consumption of food in the classroom was against school rules. The teachers promptly told me to stop providing this service. Every time I hear of someone caught for insider trading or a similar business-related offense, I can’t help but reflect on the importance of staying legal, no matter how profitable the business.

Business is all about making money…. or is it?

My initial brush with entrepreneurship has kept me focused on the bottom line. ‘Make profits, not losses’ was my mantra. This perception changed when I attended a two-day bootcamp on social entrepreneurship organized by the National University of Singapore and Grameen Creative Lab (a subsidiary of the Grameen group of companies).

There, I heard a speech by Hans Reitz, right hand man to Nobel Laureate Muhammad Yunus, the founder of Grameen Bank who earned the name “banker to the poor” for his work providing microloans to people in Bangladesh. Reitz spoke about the need for social enterprises in today’s world, where ‘traditional’ businesses have perpetuated or even exacerbated the problem of the rich-poor divide. I began to see a whole new world of possibility, where business could be used to tackle [our] most pressing issues. I am currently pursuing this path, raising funds and creating awareness for Mercy Relief, a local humanitarian NGO [non-governmental organization] that does disaster relief and reconstruction projects in developing countries. I’m also part of a team that is developing a sustainable business model to empower Bhutanese children through art.

I have learned much from entrepreneurship thus far. Yet, this is only the beginning. During a networking session, a businessperson reminded me that “being an entrepreneur is very much like running a marathon. It is not a sprint, but a long journey where you will have to carefully pace yourself. And even when you hit the wall, you can slow down but you should never, ever stop moving.”

Samuel had already known how to grab opportunities around him since he was kid, which is one of qualities needed to become an entrepreneur. Now, he tries to make difference to the world with his passion for social entrepreneurship. Currently, he is studying at Raffles Institution, and with his team from the Raffles Entrepreneurs Network, he is trying to not only to encourage its members to embrace the spirit of enterprise, but also collaborate with other schools and institutions during this period.

For insights into how business practices have changed from generation to generation, check out our interview with Home-Fix founder Low Cheong Kee.