A bird above the station.
Walk up from underground station,
a bird fly over narrowed buildings,
happy morning wind flows.
Challenges for young social entrepreneurs in Asia.
Just making a note based on our experience in incubating dozens of young social entrepreneurs in Asia region.
1. Challenges facing young social entrepreneurs in Asia.
- Capital, there is a funding gap as they can’t really go to bank (these guys are not maximizing profit!) or traditional donors (whoops these guys make money!) Local scale-up funding is even more difficult although there are some facilities available abroad (but most of these guys don’t speak English!). Many of them took a very interesting approach, offering their core capacity as services and use retain surplus to advance their course.
- Talent acquisition, not only it’s hard to find young social entrepreneurs, it’s even more difficult to find local talents to work in a social enterprise. In Asia, the family is super influential in a young professional lives, social enterprise is unheard of , too risky for most of young professionals and don’t pay that well. This is a real problem when the social enterprise grows beyond its founders, it is very difficult for them to find additional staff who have enough talent.
- Expectations from customers/partners, most of young social entrepreneurs who are successfully raised fund, find customers and get their operation running quickly got into new problem, the startup’s external expectation problem. As they are facing constraints on both capital and staff, yet their customers / partners are expecting highly out of them. This is particularly true to service-based social enterprises such as providing design service or web development service to the non-profits, they customers/partners expected professional service quality, and for young social entrepreneurs, it’s their first time on their own, they don’t quite know how to provide a smooth customer / partner experience and so on. This could kill them by providing them with bad name and hence stuck before the scaling stage.
2. Challenges facing social enterprise supporters
- CAPITAL PROVIDER / BROKER
- Investors’ awareness: There is little awareness of the concept and benefit of social enterprise in the region, therefore, it is very very hard to raise fund whether in grants, equity / debt capital to invest in social enterprises.
- Risk sharing and mitigation mechanism: This is particularly crucial to those providing seed/startup capital to emerging social enterprise as it is the highest risk period, therefore, most of the useful funding clutter at scale-up funding (of course, there aren’t many to scale as there aren’t enough startups in the first place!). There are no broadly accept enterprise rating methods / indexes / peer rating / information sharing mechanism, so the investors are pretty much cruising uncharted water each pretty much on their own. The end of the chain is even more problematic, there is no clear mechanism for capital provider / broker to actually exit their investment except things like loan agreement, buy-back enforced equity option, etc. There is no real connection between startup/seeding capital group with scale-up capital group nor there is any social capital market in the region.
- Investment readiness: There lack investment readiness among social enterprise startups, even those at a scaling-up level. A lot of basic works from business planning, due diligence, and all the way to accounting arrangement must be taken before there are ready for investment, therefore, there are high transaction cost to entry into any real investment opportunity.
- TALENT POOL RECRUITER / MATCH MAKER
- Doesn’t exist beyond volunteer organizations or traditional young professional placement organization such as AISEC.
- CAPACITY BUILDER
- Lack standard material focusing on social enterprise development such as business planning, team building and financing. Most of the stuff are from programme such as Know Your Business and other enterprise development courses which might be quite different and too traditional for social entrepreneurs.
- Lack connection to send their trained young people to access capital and other resources to really start off their ventures.
SOME IDEAS TO SOLVE THESE PROBLEMS.
1. Global campaign on youth & social enterprise to inform young people and their potential financiers.
2. Global risk sharing / mitigation partnership.
3. Regional social enterprise stock/capital exchange (already are putting in places in many country).
4. Global talent pool for emerging social enterprises.
5. Shared social enterprise capacity building material.
Innovation brokering for digital democracy!
Social innovation brokering is an exciting concept. We all know that there are lots of people working on various social innovations out there, the problem is that those people are not connected to potential supporters, especially those with money to finance their innovations.
This is particularly true for young social innovators as they might not have enough track records or working up their connection chain as yet. Therefore, even they have a chance to meet with investors, donors or other type of supporters; nothing happens because people at the other end don’t quite want to take a chance to trust the upstarts.
This is pretty much true with the traditional financial market as well, as investors are not generally trusting the new ventures. There need to be some sort of intermediary, venture capitalists and investment bankers in the case of commercial finance.
What what about the social sector? what about the environment sector? scientific sector or even social enterprise sector?
There are very few social venture capitalists or social investment bankers out there. These people finance, package and underwrite deals and catalyzing bigger partnerships with bigger financing. Of course, there are some in Europe, the U.S. and India, but pretty much not near-enough , especially in other areas around the world.
(my drawing on how the relationship initially work before the emerging groups gain trust from their supporters where direct investment is possible)
TRN Institute, where I work for, is now trying to work on social innovation brokering on several fronts. One key area is digital democracy or, more precisely, ‘internet-enabled democratic engagement’. For Thailand, people make their political decision to vote based on current temperament of the society at that given time. This is not very healthy for democracy.
Therefore, there are several groups in Thailand who are inspired by how independent organizations in the U.S. keep tracking politicians and political parties various decisions and policies over years and make it all easily accessible online. There are several groups who are actually crowd-sourcing all these political data in a web2.0 way such as politicalbase.com.
As we supported a group in Thailand, Siam Intelligence Unit, doing something similar to politicalbase.com in the U.S. but using Medi-wiki as a platform. Today, it is one of the most comprehensive online political track records of politicians, political parties and related information in Thailand. Through the process, we’ve found many other groups who are interested and working on similar issue.
The problem is that they are all young people without appropriate legal status or credible track records.
So what we did was to package their initiatives into one synergetic partnership project and using our organization as trust broker and legal underwriter in order to seek investment from local and international groups supporting free and democratic process in Thailand.
So far, we’ve successfully brokered the Thai Political Database Project as a partnership between Siam Intelligence Unit and Rengkid group with a great support from Fredrich Naumann Foundation. If the implementation is successful, Thai population will, for the first time, have EASY access to fair quality information about politicans, political parties on so many dimensions from their history, voting records, assets holding, what policies they supporters or fight against and even funny information such as how many time they join or skip formal meeting in the house of representative.
For the first time, Thai politicians and their parties will be transparently accountable to their actions, and no one will forget what they did. Of course this will not change things suddenly, but will be a good starting point on how open access to political information will enable so many groups from active citizens, web-enabled citizen journalists and even the traditional media to use this information at will without going through hell in finding fragmented information from here and there.
Open political information systems as collaborative social innovation is now started in Thailand, hopefully if the model is clear it can be replicated or scaled into other countries. And this is an example of what social innovation broker could do to foster competitive social innovation market in developing countries.
For those interested in internet-enabled democracy, check out Open Source Democracy by Demos
Young Social Entrepreneurs JAM: where East meets West!
Not so long ago, an extraordinary event happened at the World Bank in Bangkok. The event was called ‘Young social entrepreneurs mini-bootcamp”. TRN Institute was organizing the min-bootcamp that brought together young Thai social entrepreneurs working on their Internet-based startups to meet with i-genius 2008 conference’s participants such as KaosPilot, an alternative business school focusing on creating economic and social impact, and other interesting group of people ranging from indie film maker working on a movie on ‘young social entrepreneurs’ all the way to researcher working on social enterprise’s impact measurement. Around 20 people from Thailand and Europe participated.
Have a quick look at the event’s post-jam video clip below.. (just click play)
(Click here to copy the embed code)
Thai Social enterprises:
Thoth Media
Professional video podcasting / internet TV / Viral clips service as well as technological platform provider focusing on social issues. They were behind various popular video podcasts in Thailand such as duocore.tv, they did volunteered in the development of political campaign for senate election fanrosana.com as well as developing viral clips for safe sex (1) (2) and violence against women campaigns that received over hundred thousands viewing requested online in Thailand. Recently, they did video podcasting for FAO’s forestry meeting in Viet Nam, check out http://www.fao.org/forestry/site/48155/en/0/
Open Dream
Professional socially-focused web and virtual communication solutions provider as well as open source promotion coordinator in Thailand. They were behind various non-profit or socially-focused sites such as www.fuse.in.th, Thailand’s creative commons media portal, www.thaigoodview.com, Thailand’s biggest open coursewares hub. They were also organizing Thai BarCamp for the first time with hundreds of local and international geeks participated. Beyond that, they help coordinated various open source project in Thailand such as the Firefox 3 Thai localization event (house2.0)
Siam Intelligence Unit (SIU)
Alternative think tank and research service for organizations as well as the public in general on various social, environment and economic issues. SIU aims to put big ideas/insights derived from the research into the real practices of its client’s organizations. Beyond that, SIU developed various initiatives for the open access to factual political economic information in Thailand. For example, SIU created PoliticalBase.in.th, inspired by the U.S.’s PoliticalBASE, it aggregated all politicians, political parties and policies information into an Wiki platform. It is now Thailand’s most comprehensive open-access online political database.
Chivalry Silk
A startup by a 4th year undergraduate student at Thammasat University. She sources silk material from rural communities across Thailand and sells it online through e-commerce with better-than-fair-trade policy for the community. She had successfully sold over several hundred thousands baht already.
Other participants:
KaosPilot
KaosPilot International is an entrepreneurial education for young entrepreneurs and project leaders with a creative edge and a global mind focusing on new business design and social innovation. The team participated was from the Netherlands group. http://www.kaospilot.nl
Bact’
strangely influencial and all-seeing indepedent blogger in Thailand. http://bact.blogspot.com
The World Bank’s Youth Club
A big group of young people (1500+) working with the World Bank Bangkok in order to understand more about poverty alleviation and actively play role in poverty reduction. http://www.wbyc.net/
TRN Team
TRN Institute is a provider of social innovation design and investment services with a specific focus on catalyzing high-impact, scalable and sustainable social innovation by fostering robust networks of innovative ideas, people and financial resources. http://www.trnlab.org
The mini-boot camp agenda was as followed;
1. Social Enterprise 101 (download pdf) {developed as speaking-aid, so it is not complete without my speaking, although it should be somewhat understandable}
2. Social Enterprise Planning (download pdf)
3. Intense enterprise concept debate.
This debating process started by getting the young Thai social entrepreneurs to pitches on their social enterprises, and then they are divided into tables, one enterprise per table. Then, the rest of the participants went around each table and participated in intense debate on the validity and brain-storming on their social enterprise concepts.
There were definitely the great fusion of ideas, especially after the initial cultural crashes between the young Thai entrepreneurs and those from Europe. At the end, it was something like Socratic method implemented onto social enterprise workshop with lots and lots of great new ideas and input flying around contributing to the operational models of each venture.
We really hope to see this East meets West crunching activity again some time in the future. The World Bank’s Youth Club was a great venue host for the event even with such short notification, we dreamt up the event in couple of days after one of our staff went to i-genius conference while we were working on putting together a trainning workshop for young social entrepreneurs in Bangkok.
Personally, for me it was a great event simply due to the fact that it was almost a spontaneous self-organization of a group of people coming from different backgrounds and countries, however, with a common believe of the power of social entrepreneurship to shift this world into the sustainable future. We might not live in Silicon-valley, but we could create similar cultural environment here in Bangkok.
Perhaps this event is a prototype for the future of education, organization and networking for great impact.
Innovation’s Initial Slow Pace
Some interesting thought from the preface of the book ‘The Slow Pace of Fast Change’.
It argues that the more connected the network is, the more it would experience the initial slow pace of innovation diffusions even with those with the highest degree of break through.
This goes against the common sense where the more connected, the higher degree of of diffusion. Similarly to the premise outlines in those popular book such as the Tipping point which simply concludes that it is possible to find the CONNECTOR who will spread the news/meme/innovation like a wild fire.
Of course, this paradoxial knowledge is not new, especially if one follows the recent development of network sciences, especially the role of social network threshold in innovation diffusion.
The idea is simple really, most people don’t try or accept new thing unless many of their close friends do. Each person have their own threshold on exactly how many friends it takes to accept new thing. The problem is, as your close friends grow rapidly with the growth of ICT-enabled social networks, the threshold even with the same ratio (such as 2/3) will result in the lower probability for you to accept new stuff. If you are in a room with 100 friends, it will take two third of those people to be convinced before you would. Actually, the more people adding into the social network, the threshold ration tends to change also for the worst. Of course, it would take much longer time before the diffusion happens, but once it does,
This argument is a basic stuff from social network sciences.
Now, this new book ‘the slow pace of fast change’ put forward the same arugment but using Game theory, it basically argues that the decision to accept new innovation depends on the move of so many people in the games, sort of the Nash equilibrium we learned during Econ 101, where everyone tries to maximize their payoff matrix. And exactly because of this, the more connected the game / network, the more time it will take for people to reach their innovation-acceptance decisions, especially in reality people don’t know other people’s moves. When people works on imperfect information, they tends to reserve their move in the safest manner. This can, of course, lead to something like prisoner dilemma where everyone is worst off because of their fear for others.
Anyway, this is quite insightful for people trying to create innovation diffusion or cascade over the Internet, especially those working on web2.0. The initial phase can be slow but once it picks up, the fast chagne could come. The key is to look very very closely to the development of intial responds of various players in your innovation game. Exactly how, once I read the book, I will blog more about this 
Open Source Democracy Venture in Thailand!
TRN was co-founding a political database website www.politicalbase.in.th which was launched last week in Beta. We hope that it will be a small step towards a more transparent, more open source democratic process in Thailand empowering by the Internet. The site was developed using WikiMedia engine to allow broad-base contribution in the future. The site was inspired by www.politicalbase.com beyond that, the concept of Open Source Democracy can be founded and downloaded as free PDF at the DEMOS website.
Here is what Bangkok Post, a local English newspapers, was covering the story. (click for the original post on newspapers )
Want to knowall about Thailand’s politicians?
New database has the answers
By Achara Ashayagachat
A group of young professionals have launched the first online database containing everything you want to know about Thai politicians and political parties. Project leader Charoenchai Chaipiboolwong, of the Siam Intelligence Unit, said the Thailand Political Base website (www.politicalbase.in.th) would become one of the practical tools for people to monitor political figures as well as check on backgrounds and policy platforms of political parties.The initiative was based on an idea that information is the key for ”quality politics”, he said.
”It is the people who have to stand up to protect their own interests and they can do so if they have information. When they get the information, they can share it with their colleagues and friends or create a small network to exchange this useful data,” said Mr Charoenchai, a businessman at a security firm who teamed up with his economics graduate friends from Chulalongkorn University.
Thanee Chaiwat, an economics lecturer at Chulalongkorn University’s Centre for the Development of Policy Studies, said political parties fielding candidates in today’s election had come up with similar policies, so voters need to check the backgrounds of each candidate to help them make the right decision.
The website, which is still in a fledgling stage, is sponsored by the Friedrich Naumann Foundation, the Siam Intelligence Unit and Social Innovation Design.
Kan Yuenyong, another team member, said the website is expected to operate like the free encyclopaedia Wikipedia where internet users can get reliable information on certain topics.
The website now contains brief histories of about 40 prominent politicians such as Thaksin Shinawatra, Samak Sundaravej, Abhisit Vejjajiva and Chuan Leekpai.
It also has lists of cabinet members of previous governments, the 2007 constitution, facts about the Sept 19 coup and laws passed by the National Legislative Assembly.