Last Wednesday the Sustainable Business Network held the Quick Fire! event at AUT, in partnership with Social Enterprise Auckland. It yielded a bumper crop of advice for start-ups, disruptors and social enterprise champions. Read all about it.
Are you attempting to overthrow gigantic corporate incumbents in your market? Exploiting an unserved niche? You are going to needs to tips n tricks to make it work.
Al Yates is a director of Ecotricity and managing director of Wind Farm Group. He has spent more than 14 years working to transform New Zealand’s energy sector.
Overcoming incumbents in the electricity industry is no small feat. Speaking at Quick Fire! Al Yates shared how Ecotricity works its sustainability story to its advantage.
“You’ve got to find the champion within the business,” he explains. “Sustainability is now moving up the importance list for CEOs. We try to provide benefit beyond the financial benefit.
“It’s a fact that we are doing the right stuff. So when we get larger companies on board we publicise that they are buying carboNZero power. The carboNZero and SBN member logos on our website add a lot of value.”
This approach has seen many SBN member businesses signed up, including Les Mills, Green Gorrilla and more.
Oscar Ellison is founder of the YourDrive peer-to-peer car sharing platform. He described how networking can lead to business transformation. A pivotal strategy session for his company took place for free with a friend from another business. They ran into each other waiting for a delayed plane.
“He said to me, where do you want your business to be in three years? That’s what will attract people.”
YourDrive has released more than $250,000 worth of rental value form New Zealand vehicles.
“We are now reaching the stage where there is the vehicle you need just round the corner,” said Oscar. “You can rent it from a neighbour rather than a big business. You don’t need to worry about car ownership.”
A large part of this continued success is being choosy about who gets let into the network. Similar selectivity was applied in creating YourDrive’s partnership with Jucy. Jucy has taken a 50% share in YourDrive, which will help fund continued growth.
“There were other people we would pitch to,” said Oscar. “But right from the outset there was no value alignment. We had to be true to what we stand for. Jucy has 500 staff and we have a team of five. We are a tiny component of the overall group’s revenue model. So we had to make sure that they were behind us 100%. We needed clear lines of reporting and advice set up. They needed to understand the business model.”
It’s led to a strong proposition in a very new marketplace, which should make for an exciting future.
“If you know what you stand for you can’t say yes to everything,” advised Oscar. “You’ve got to live your values. If you do that you don’t need to lie. You just keep on doing what you are doing.”
We Compost is another business with a clear purpose. Founder Steve Rickerby started the firm while working in insurance. He spotted a gap in options for commercial compostable waste and went for it, boots and all.
“I realised that people wanted to make a difference, but they didn’t have the means to do it,” he said. That realisation led to a lot of hard work.
“It took me two years of picking up compost in the back of the ute until I got my first truck. That wasn’t making any money. The first couple of years were pretty slow, because people didn’t even understand the concept. People weren’t aware they even had that waste stream.”
At that stage the company was adding one more bin collection a month, and had 20 bins a week to collect by the end of the year. Luckily Steve enjoyed the work, and believed in what he was doing.
Z was one of the first large customers to come on board. Steve got a call from a forecourt attendant asking if he could pick up the waste pies and coffee grinds. Steve contacted Z’s head office. They put him through to national sustainability manager. She said they were just starting to look at it. Each of the sites is owner operated, but We Compost now collects form several of them.
“Things have changed quite a lot now,” he said. “I don’t bother trying to convince people. I focus on the things I can control. It’s being able to understand our market and the sort of business that would use us, and then positioning us so that we are there when they are ready.”
“There’s a real art to understanding when you are actually delivering value.”
Pete Russell is the founder of Ooooby, an innovative local food delivery platform.
“You’ve just got to keep talking about what you do until it’s a big idea ball that people can get involved in,” he explained.
What powers those conversations is a keen sense of the business realities. This is what steered Ooooby through crowdfunding $285,000 for its expansion in 2015.
“A positive cashflow model was critical so that we can grow the business without getting outside investment.” Pete said. “Fundraising was something I kept putting off. I wanted to keep the flexibility to move with what we were up against. I had experience from other businesses of having the reigns put on when people invested. I wanted to find our groove and what the model was going forward before having the reigns put on.”
“The whole philosophy is about something commonly held where everybody has a stake in it. Crowdfunding was a way of demonstrating that we were doing something of value for everyday people. When you find that point and the market is ready there is a lot of scope to grow a business”
Ooooby is a social enterprise and a labour of love. Its development since 2008 has been bootstrapped from cash flow and personal contributions from those involved.
The new investment has helped to spark the next stage in Ooooby’s development.
“We have sold more than 200,000 boxes to nearly 10,000 people,” said Pete. “We have dealt with pretty much all of the challenges that come up in this sort of business. We now have a working model, but, more importantly working knowledge, on how the system needs to work. Today we are doing close to 3 million in turnover across all hubs, which is good, but we need to jump into the next phase. What we have built to date is a prototype really, which is informing the development of a new platform which can really scale. Once we have version two developed it will be a much more relevant service offering with a much broader reach.”
Martin Wylie is CEO of Elevator group. It’s a charity but operates as a business employing 200 people directly and a supported employment organisation that enables people with diverse needs to find work. Its inception goes back 50 years. Many of the trade-offs involved will be familiar to lots of new social enterprises.
“There’s a tension between holding on to good people and moving them on to open employment,” says Martin. “And a tension between getting jobs by going in low cost, and trying to raise wages.”
In other words, balancing the needs of the individuals involved and the shared mission.
Sam McGlennon, SBN project lead for community, helped to organise the Quick Fire! event.
“It was really valuable to have these top business people share so openly about their challenges, and how they overcome them,” he said.