Dante Godinho's Blog

In our most recent class, Social Enterprise Applied, instructor Jeff Kroeker shed light on some examples of social enterprises, such as TOMS shoes, whose now infamous “one-for-one” mission promises to deliver a pair of shoes to a child in need with each pair of shoes purchased.

Over the weekend, I stumbled upon an advertisement that lead me to the homepage for Flex Watches, another company contributing to the up and coming wave of social enterprises. Flex Watches concept, the so-called “10-10-10” mission, is simple: they manufacture 10 watches of different colour, have partnered up with 10 different charities, and promise to donate 10% of the revenues generated by each specifically coloured watch to the associated charity it represents (for example, think a pink watch for breast cancer). For further explanation, here is a video that summarizes what the enterprise is all about.

https://www.youtube.com/watch?v=ATqxqK2NS7w&feature=player_embedded

In my opinion, their business plan is brilliant. If the company is able to market itself effectively and become recognized on a global scale, there’s no telling what an impact these donations might have. Based on what I saw on their website, however, I believe the watches correspond to a very young target demographic and that, in order to see sustained success, they should consider developing a more sophisticated product line.

In response to Kevin Yu’s blog entitled RIM: Comeback??

It’s hard to argue against the notion that RIM’s fate rests in the hands of the new Blackberry 10, which is expected to be released in early 2013. As shown in the video below (also on showcased in Kevin’s post), the introduction of the new operating system, “Blackberry Flow”, provides an example of a feature that sets it apart from previous models. In my opinion, it seems like many of its features imitate the systems in which Apple and Android phones have been using for years.

https://www.youtube.com/watch?v=mmND2-fkUD0&feature=player_embedded

Nonetheless, as Kevin notes, RIM shares rose a dramatic $0.80 earlier this month – its highest closing price in more than a full quarter. Whether this is a viable prediction of what to expect in the near future, however, is debatable. Perhaps, as Kris Thompson mentions in the linked article, the share price was simply bid up by investors seeking capital gains by buying the stock prior to commercial availability.

While it seems close-minded to say that RIM doesn’t have a shot at recovering, I believe it’s chances are slim. At least from the sneak peak in the video, it appears that Blackberry software is merely trying to catch up to its competitors in many facets, while its competitors continue to push new boundaries. Moreover, some of the features that made Blackberry successful in the past, including its encryption software and Blackberry Messenger, have been successfully duplicated by both Apple and Samsung.  Nevertheless, it will be interesting to see whether or not the Blackberry 10 will be RIM’s saving grace.

You may have heard about “crowdfunding”, a relatively recent phenomenon currently used by social entrepreneurs and charitable organizations to raise money for various causes. Thanks to the implementation of the JOBS Act in the United States, crowdfunding may soon become a very useful and innovative way for entrepreneurs seeking funding for their for-profit businesses as well. Traditionally, charities and other promoters of social causes reached out through the internet to obtain donations from the general public to support their causes. Sometimes donors get tax deductions for their contributions.  This novel use of the internet allowed certain organizations to successfully raise considerable funds.

Earlier this year, there was a potentially revolutionary change to the way entrepreneurs will be able to fund their ventures as a result of the U.S. Congress paving the way for equity crowdfunding. To date, securities regulators in both the U.S. and Canada restrict who can invest in companies, with a mandate to prevent fraud, but crowdfunding would open up investment to a far greater audience. In order for this to occur, regulators from the SEC will have to amend their rules to regulate crowdfunding. Will they do it? I can’t predict at this time, but think it would be of great benefit to venture capitalists and start-up entrepreneurs.

Sources:

Forbes Article: Eight Crowdfunding Sites for Social Entrepreneurs

VentureBeat Article: SEC Uses Jobs Act to Set Up New Roadblocks to Crowdfunding

On Wednesday, the Montreal and Denver based brewery Molson Coors announced that the NHL Lockout has triggered a reduction in sales across Canada for some of its marquee brands – namely Molson Canadian and Coors Light.

https://www.youtube.com/watch?v=7iok04t3TvE&feature=relmfu

As illustrated in the above video, Molson Canadian’s marketing campaign relies heavily on tying together its product with Canada’s love for hockey, and they have succeeded in doing so for years. I think I speak on the behalf of all Canadians in saying that when you think of Molson Canadian beer, you think of clinking pints or bottles together with a few friends while partaking in a hockey game.

In a recent interview, Molson Coors CEO Peter Swinburn said, once the lockout has commenced, his company will seek financial compensation for the impact that the lack of games has had on sales. This statement gives insight into another set of ramifications the lockout has brought about – unhappy sponsors. As the saga continues, it will be interesting to see if other major NHL sponsors, such as Canadian Tire, Kraft, and Sirius XM, plan on following in Molson’s footsteps.

Sources:

Montreal Gazette article: Molson Coors suffers sales blow in Canada from nearly two-month NHL lockout

CBC Sports article: NHL meets with sponsors concerned about lockout

I few weeks ago I was walking through the Henry Angus building when I stumbled upon an information booth on Sauder’s Africa Initiative – an initiative designed to uplift the lives of youth in Africa’s largest country, Kenya, through sustainable social entrepreneurship. I was immediately drawn to the initiative and decided to conduct a further investigation of what it entailed, which is when I came across this blog post by Sauder MBA student Steve Hosein. In summary, the post shares the story of Donald Walufa, a high-school educated artist from Nairobi that benefited from business instruction provided by the Africa Initiative. Donald’s plan is to sell his artwork to tourists who are looking for an original souvenir that captures an experience and has intrinsic meaning behind it. In my opinion, not only is Donald’s artwork beautiful, he has tied it together with an effective business plan. As Steve acknowledges, “there is palpable difference between art that someone has specifically created for you versus some random object whose provenance and intended meaning are unknown to you”. While the demand for original artwork is certainly present, I believe developing a quick and easy way of getting the artwork to the hands of consumers is essential to the growth of Donald’s business. I wish Donald the best of luck – if you are interested in commissioning a piece of his artwork, please follow the instructions on the linked blog post!

I walked out of today’s class feeling compelled to learn more about Kiva, a social enterprise founded by Matt Flannery who, much like Muhammed Yunnus, saw potential in utilizing microfinance as a means of solving poverty, and furthermore brought the idea to an online platform. The reason that I feel Kiva will continue to gain popularity and bring about it’s desired impact is that, in my opinion, there is a plethora of people that would like to join in the battle against poverty yet have no idea where to begin. We are bombarded by charities seeking our support, yet the benefit seen by the beneficiaries is rarely sustainable and therefore we, as donors, do not feel that our contributions are making a long-term impact.

Kiva provides a solution to both these issues because it introduces a self-sufficient, sustainable alternative and, given minimal loan amounts and an impressive payback rate of 98.99 percent (Kiva 2012), almost everybody can participate. It seems to me that if we are serious about helping out those in need we should focus much more of our attention to Kiva and enterprises like it – I certainly plan on lending money in the near future.

Click here if you’d like to make a loan.

Being an avid hockey fan, the news of the NHL lockout this season has been, to say the least, devastating. I began to think of ways in which this scenario applies to something we’ve learned so far in Comm 101 – seeing as, after all, the entire lockout rests upon a financial disagreement. It then occurred to me that the dispute could be, in a rather unconventional manner, be broken down into concepts we learned in Class #9: Planning and Strategy. Essentially, the dispute is a collective bargaining disagreement between NHL owners, who are demanding a greater share of the league revenue, and the players, who aren’t willing to budge under the current division. Similar arguments have arisen in the past, resulting in three separate lockouts within the last 15 years, all of which have ended in the players receiving a lesser share. So why might this one be different? Enter buyer power. In the past, the “suppliers” (owners) have been in a position of great power due to few alternatives for NHL players, or in this case, “buyers”. With the emergence of the KHL (“new entrants”), however, we are seeing more and more star players, including the likes of Evgeni Malkin and Alexander Ovechkin, make the switch across the Atlantic. Although most players are sure to return to their NHL team upon the culmination of the lockout, I’d take caution if I were an owner. While the KHL isn’t quite up to par with the NHL yet, it is certainly well on it’s way.

National Post article

Browsing through blog posts from fellow classmates, one that I can relate to is Gianluca Camerin’s post “IKEA’s One Problem”.  IKEA in late August is a haven for university students and, in accordance with Gianluca, it is the place to go if you’re looking for sleek and modern furniture and would rather spend some time on assembly than forfeit your bank account. We differ, however, on our opinion of the floor plan. IKEA has devised a way in which to use the layout of the store as a marketing scheme – funneling customers through segmented sections, each designed to adhere to a specific area within the house, in a particular order. Where he sees “problem”, I see convenience. While some may argue that this process is confusing and tiresome, I believe it’s simple and efficient (especially for two 20-year-old college kids like my roommate and I). Others complain that IKEA tricks you into buying more than you bargained for, however, I have a quick and easy solution for these people: make a list of needs before you go in. It will save you some extra cash and might even make your IKEA experience a little less chaotic than you expected.

The result of my roommate and I playing a crafty game of furniture Tetris with our new purchases at IKEA.

Original Globe and Mail article

(Photgraph: Stephen Chernin – Getty Images, The Guardian)

According to the above Globe and Mail article, Starbucks representatives announced today that, after much anticipation, they will be teaming up with local Indian steel-to-beverage conglomerate Tata to open up the first Starbucks outlet in India. Analysts say that Starbucks has been eyeing down the Indian market for years and, in my opinion, this announcement comes at a great time for the world’s largest coffee-chain. Why? Starbucks posted its third-quarter fiscal reports in July. Results show that out of the 116 new stores it opened worldwide between July 2011 and July 2012, 45 of them fall under the China/Asia Pacific segment and revenues in this particular area have increased an incredible 31% (Starbucks Corporation). It only seems logical that the next step is to expand to the rapidly emerging, untapped market that is India. When you factor in India’s already massive economy, its populations general rise in spending power, the lack of serious competition, and India’s well-known affinity for tea, the Indian market serves as a huge long-term opportunity for Starbucks.

The following linked articles involve a local Vancouver corporation’s (Baja Mining Corp.) alleged misrepresentation of increased costs for its Boleo mining project near Santa Rosalia, Mexico. In April of 2012, the company’s stock plummetted over 31% after news of a $246-million cost increase was announced. The announcement was made shortly after a contested proxy battle was narrowly won by the existing management/directors over a new slate of directors proposed by the company’s largest shareholder. The central ethical issue concerned is whether or not the management team deliberately withheld crucial negative information in an attempt to maintain their current position at the time.

Canadian Business article/July 27th, 2012

Financial Post article/April 25th, 2012