It is not easy to start a social enterprise. In addition to keeping the enterprise afloat financially, the entrepreneurs have to find buyers who are aligned with their vision.
To help nurture the next generation of social entrepreneurs, Alliance Bank has organised the Eco-Biz Dream Project for university students. The programme, which is now in its third year, will help the winning team move past ideation to implementation.
The bank is working together with environmental non-governmental organisation EcoKnights and government agency GreenTech Malaysia to organise the competition. Selected teams of students will go through training and pitch their business ideas to a panel of judges.
In the past two years, the competition ended at the ideation stage when a winner was chosen. This year, the organisers want to support the winning team in the implementation of the business idea.
"We are looking for a platform where we can motivate students to develop their entrepreneurial skills with a sustainability mindset. Our corporate social responsibility (CSR) programme is not touch and go, so we are looking to create a programme where their ideas can impact the environmental, social and economic [conditions] of the community," says Kue Kit Wai, head of corporate responsibility at Alliance Bank.
Its Islamic banking arm will integrate Values-Based Intermediation principles to help the winning proposal have a chance of implementation. Values-Based Intermediation is an initiative by the Islamic financial industry to generate positive impact on the economy, community and environment. Its underlying values are determined by shariah principles.
This year, the challenge is particularly difficult - the revitalisation and protection of the Kerayong River corridor in Kuala Lumpur, which is part of the River of Life project.
Yasmin Rasyid, president and founder of EcoKnights, says this is a good opportunity for students who are not business degree holders to learn about business models and pitching. "We wanted an idea that would solve a real-world issue, which is how to revitalise degraded rivers in cities with entrepreneurial solutions. Unless you are a business degree holder, you would not know much about business canvas models or how to pitch and prepare the right documents."
Elina Jaini, chief of strategic communications for GreenTech Malaysia, says this will give participants an opportunity to examine the problem and engage with locals to find a solution. "There are a lot of PPR project flats around the area. People probably say they won't walk by the river because it is too smelly or they see dead fish and vandalism, for example. When the students hear these problems, they can really understand the people who live there and the changes they want to see."
Elina and Yasmin were involved in the previous iterations of the competition. They still remember the winners from last year, who impressed them by creating a technology that could help farmers reduce water consumption in padi fields. The idea was actually a faculty project that the four engineering students from the International Islamic University Malaysia were working on.
"They modified an existing machine to better utilise water consumption and they talked to the rice farmer cooperatives and a couple of farmers. They just did not know how to market this on a bigger scale. The exposure from Eco-Biz expanded their skills beyond engineering and helped them communicate better," says Yasmin.
The five-month programme is part of Alliance Bank's CSR initiative. The selected teams will receive coaching and mentoring from the Eco-Biz Dream project trainers as well as from the Asia School of Business in collaboration with MIT Sloan Management. The awards ceremony will be held in January.
Why the need to nurture social entrepreneurs
According to Elina, there is a lack of green technology solutions in Malaysia, although there is great demand for them. Social entrepreneurs who venture into this field often face challenges in getting certifications and financing due to a lack of awareness. These hurdles come despite the potential that green technology can bring to the country's economic growth, she adds.
"We have already created a marketplace through many programmes, but we are struggling to get the ideas from the supply side in terms of potential technologies, products and services. That is why we want to accelerate ideas from the youth as they go on to work in small and medium enterprises and companies."
The demand Elina is referring to comes from government ministries, which are pushed by the organisation to buy green products in their procurement processes, and from public-listed companies that are encouraged by Bursa Malaysia to submit their sustainability reports. "State governments also have a green agenda and are encouraged to buy green products," she says.
Market validation is very important for social entrepreneurs who come up with new products and services. The buyers, be it the government or a company, would want to look at the product certifications and standards before making a decision. This requires knowing whom to reach out to and how to do so.
"They will need to go through the hurdle of applying to the Energy Commission and Sustainable Energy Development Authority for energy products, Suruhanjaya Perkhidmatan Air Negara for water products and Sirim for eco-labelling. GreenTech Malaysia also has MyHIJAU certifications," says Elina.
"If they have a product related to buildings, they will need to engage with parties like Jabatan Kerja Raya, the Green Building Index or even the Real Estate and Housing Developers' Association to see if they have a market for the product."
Financing is another area that entrepreneurs may struggle with. With green technology being a relatively new sector in Malaysia, it may be tough to convince banks on the viability of their products and the market for them, Elina observes.
"Some companies are not aware that they can raise funding through the capital markets, for example. These are the main issues for people who want to make it in the green tech business," she says.
Yasmin says consumers nowadays are more discerning about the products they buy and will not be swayed by companies that simply advertise that they have a "green product". Social entrepreneurs will have to take more steps to convince consumers, she adds.
One of EcoKnights' initiatives is known as "Green Markets". Through this initiative, it encourages small entrepreneurs to get the proper certifications, if they want to scale their business.
"We need to recognise that there is a global advantage if you are certified to that level. Then you can focus on pushing your product," says Yasmin.