This article first appeared in Capital, The Edge Malaysia Weekly on February 7, 2022 - February 13, 2022

IN 2008, Darius Yuen founded Sow Asia, a Hong Kong-based charitable foundation that has been supporting early-stage social enterprises intent on scaling their social or environmental impact. The idea is to help social enterprises – organisations, typically micro or small in size, that use commercial strategies to maximise improvements in financial, social and environmental well-being, while generating profits for their owners – grow, self-sustain and attract external funding in order to make a lasting and positive impact on the community.

Into its 14th year now, the foundation, chaired by Andy Tung, the son of Hong Kong’s first chief executive Tung Chee Hwa, has nurtured 72 social enterprises. It has achieved a 94% success rate through its accelerator programme, which provides mentorship and consultancy to accelerate a social enterprise with potential to get it investor-ready. It also invests directly in the graduates of its accelerator programme when it sees an alignment of interests.

Based on its latest tally, 71% of those that Sow Asia nurtured found potential investors and business partners through the foundation. As at July 2021, more than HK$119.2 million in total was raised by 41 alumni who responded to its survey (excluding undisclosed amounts) about their current status.

Meeting with The Edge at his father’s house in the heart of Kuala Lumpur recently, Yuen says he sees impact investing as a vastly better and more sustainable way of helping those committed to improving society or the environment, rather than the conventional way of giving donations.

“As the Chinese proverb goes, instead of giving a man a fish, teach him to fish. That’ll feed him for a lifetime,” says the Hong Kong-born Malaysian, who is passionate about philanthropy, having been taught by his father to think of the needs of others before his own wants — and more so about making giving sustainable.

It was this passion or calling, as he terms it, that made him take the dive into venture philanthropy with Sow Asia when — after more than 20 years in investment banking and finance, of which eight years were with BNP Paribas — he was given the golden handshake just as he was moving to his new role as senior managing director role at Bear Stearns in 2008. In fact, the announcement of his new job came just hours before news of Bear Stearns’ financial woes spread on Wall Street that year, precipitating a wider collapse in the investment banking industry that also took down major companies such as Lehman Brothers.

For the remarkable work he did with Sow Asia — which is still going strong — Yuen was honoured as one of Forbes’ Heroes of Philanthropy in 2011, when he was 41. More than a decade after that, success stories such as HK Recycles Ltd, which provides convenient recycling solutions for offices, schools and retail stores, alongside employment to autistic youths, keep him going.

“I think it’s because it checked all the boxes for the triple bottom line — the social impact measurement, the profitability and the environmental impact. The business itself is growing and making a big impact. I still remember the story of how an autistic youth got a full-time employment contract with HK Recycles, and how his mother started crying because she never imagined she would ever see such a day. He’s still there with the company, and the best worker too,” Yuen says.

HK Recycles, which has started paying dividends recently, epitomises everything that he envisions for a social enterprise and how it can deliver good to society — continually. “In 2018/19, it recycled 154.4 tonnes worth of materials, which is equivalent to 305.2 tonnes of carbon dioxide emissions, or the carbon footprint of 727 round-trip flights from Hong Kong to Narita, Japan. In 2019/20, it did 189.3 tonnes, or equivalent to 868 round-trip flights,” Yuen proudly reads out from a brief he had prepared for the interview with The Edge.

BNET-TECH Co Ltd, which has developed smart walking sticks for seniors, is another notable alumnus. The “STICKu” walking stick incorporates special features such as GPS for location tracking as well as a sensor that alerts the caregiver when the user has had a fall or accident and may need help.

Yuen, who has more than proven how Sow Asia can help local social enterprises in Hong Kong through its accelerator programme and direct investments, is now keen to bring the organisation’s expertise to Malaysia.

Yuen, who is managing director and responsible officer of Zhong Yi Investment Managers Ltd, an asset management company that he founded in July 2018, believes his experience as an investment banker and his network of contacts can help new social entrepreneurs fine-tune their businesses and connect them to potential investors.

“I envision setting up a similar board [in Malaysia] like the one we’ve set up in Hong Kong, to establish an ecosystem that will nurture social enterprises,” he says.

“I’ve spoken to some people here. The second and third generations of wealth — those in their 20s to 40s, and even some in their 50s — are starting to understand and see value in impact investment, and to recognise it as a small but growing asset class. If we start from the top down and embed this thinking in investors and businessmen – that they need to have a social impact in their investments – then this will influence the businesses around them to have a business model geared towards that.”

A company that wishes to seek Sow Asia’s help has to meet a list of criteria: It aims to tackle social challenges with innovative technology; has been operating between one and three years; has had limited market trials or at least a pilot test; and preferably has at least two full-time co-founders.

“In the past, some didn’t work out because there was a conflict between the founders. Then, there were those who just gave up halfway,” says Yuen of those whom Sow Asia mentored but did not make it.

There have also been instances in which Sow Asia invested in a company that graduated from its accelerator programme but subsequently went off-course. “The people behind it see only the pot of gold but I don’t want just that. I want some gold, yes, but the social impact as well. So, we parted ways and they paid all our money back,” he says.

These experiences have taught him that social entrepreneurs who wish to benefit from Sow Asia’s mentoring must show they have some skin or commitment in the business they are doing.

“Most of the people I meet know of my background. They know I’m a sort of hybrid investor-philanthropist. I tell the would-be donors or investors that I will use their money to create more socially impactful investments. That’s my passion. So, when I look for social entrepreneurs (to mentor or invest in), I look for similar people with a similar passion and conviction — to do something good for the society we live in, to help solve our social or environmental problems. These are the people I want to support.

“And don’t tell me you’re only doing this as a part-time interest. To sustain this [a social enterprise] is the same as sustaining any other business — it’s a lot of hard work.”

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