Netherlands | Social entrepreneurship
Make waste great again
How do we create an inclusive society which is not solely focused on economic growth, but on other values, so that everybody can participate and contribute in their own way? We'll talk about the rise of social entrepreneurship and Rabo Foundation's role in it. ”These are entrepreneurs who prove that we can do this differently.”
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“I missed the point of me being there and my added value in the production story”
Make waste great again. This is the first thing you’ll read when visiting the website of Fraenck, maker of high-end design hand bags. Founded by industrial product designer Pascal Mulder and fashion designer Ratna Ho, partners in business and private. Fraenck designs and sells hand bags and fashion accessories made out of residual materials from, amongst others, the sail-making industry. These items are made in their own atelier by people with, for whatever reason, a distance to the labor market. For sale in London, Amsterdam and in their own conceptstore in Arnhem. Every fashion victim or whoever likes bad ass and distinctive products gets gready.
Hot items: hand made pencil cases made out of recycled fabric from the Sprinter Lighttrain and hand bags made out of bus canopies from Zwolle. Mulder: “We don’t only focus on making beautiful and good products, but also on the social impact we are making.” For Pascal, in college it wasn’t that obvious to start a social enterprise. “First thing I learned was designing according to specific standards, focused on mass production. I missed the point of me being there and my added value in the production story.” That is why Mulder attended ArtEZ, the Art Academy in Arnhem, where he met Ratna Ho. “On the academy we mainly talked about concepts and continuously asked ourself the question ‘why?’.” This filosofic way of thinking got Mulder and Ho to do the same.
“We want to make beautiful, sustainable hand bags. At first we purchased gorgeous sailcloths from Buitink Technology, until we notices how many residual material was left.” Then and there they decided to only work with residual material from not only Buitink but also all other partners. By 2016 they won the ASN Bank Worldprice for their collection of sustainable hand bags and in 2017 they opened their concept store in the heart of Arnhem. Everybody who visits this concept store can witness how the hand bags are made. Their atelier is right behind the concept store.
Two years later, when their brand name was still Ho&Mulder, they were nominated for the Ignite Award. Recently their first deal was made with outdoor shop Bever. Clients can hand in their old, discarded tents at Bever and Fraenck will transform this into fashionable accessories which again will be sold at Bever.
“Entrepreneurs like Pascal and Ratna show us that by doing it differently and having a sustainable and social business model, you are still able to have a healthy and profitable company. Besides that you can grow and have a positive impact on your surroundings”, according to Nynke Struik, program manager at Rabo Foundation. Fraenck is one of the social enterprises in fashion which received a loan and extra support of Rabo Foundation. Fast fashion, every six weeks a new collection, is one of the most pollutive and dehumanizing industry. In the Netherlands the amount of companies which want to make a difference, like New Optimist, Sjaak Hul le Kes and Fraenck, are growing.
The big difference between these companies and fast fashion is that the work of social entrepreneurs is based on principles like sustainability, circularity, local consumption, social impact and honest pricing. That doesn’t mean that these social entrepreneurs don’t have to make a profit to stay alive and complete their mission. Mulder: “Just like any other company we are self-sufficient. What makes us different is that our focus is mainly to make sure that our employees work in a safe, nice and valuable environment where they can develop personally and professionally so their distance to the labor market decreases.
“The most important demand we have”, starts Struik, “is that the impact that companies like Fraenck are making is visible, together with a solid revenue model.” And, “as an entrepreneur you have to make money so you are able to meet the financial commitments you are (and have to be) making along the way.” The impact reports are mainly obligated to prevent greenwashing. Greenwashing is ‘pimping’ non-sustainable companies to make them look sustainable. Rabo Foundation only provides loans to companies in their start- and scale-up phase, so entrepreneurs can show the bank that their company is viable. And yes, this is a totally different a way of working if you compare it to 10 years ago. Struik: “At the time, what the Foundation did in the Netherlands was very broad. Anybody could hand in a request.
Now we focus on providing impact loans to social entrepreneurs and on the debt problems. We know a lot about both subjects, which gives us the possibility of making a greater impact there in stead of broadening our focus.” This approach is closely connected to the goals of the commercial departments of Rabobank on level of sustainable entrepreneurship as well as the programs the bank offers in order to prevent people to get in to debt problems. Struik: “Not being able to have job or being in debt has a huge influence on the lives of the people who experience this, as well as on their children. They suffer from stress, shame, often end up in social isolation which unfortunately continues in the next generation.” Mulder: “A lot of people are just put aside. We want to do something about this and be there for one another.”
Now and again they find themselves in difficult tension fields. This is an immediate result of the choices he and Ho made when they started with Fraenck. “We’d like our employees to contribute in an active way, but we also have to take their vulnerability in consideration. And no we are no caregivers, we leave that up to the job coaches. But we can offer our people work, regularity and a nice work environment so they can participate fully.”
Pascal Mulder & Ratna Ho - Founders of Fraenck
Nynke Struik - Program manager Rabo Foundation
“We hope to ignite regular companies to choose this way of working”
Not only young entrepreneurs in fashion choose for the sustainable and social way of working. Entrepreneurs with companies like de Koekfabriek and Opnieuw BV are choosing this approach and work with people with, for whatever reason, a distance to the labor market. De Koekfabriek bakes and sells cookies. The more they sell, the more jobs they can offer. Opnieuw BV recycles office furniture. Struik: “These entrepreneurs currently form a vanguard. By showing the impact they’re making, we hope to ignite regular companies to choose this way of working or start working together with social enterprises like Bever does with Fraenck.”
The amount of social entrepreneurs increased incredibly the last years. In total in the Netherlands there are over five thousand active social enterprises. Knowing there are over two million companies in total, this looks like a drop in the ocean. But, the government is also acknowledging the urgency of change and is preparing new laws to boost social entrepreneurship. This helps these companies to show (as easy as in their title) that they are using a large part of their profit to realise their social mission in stead of distribute this to a shareholder. For example, Fraenck has a profit limitation of 50%. This means that half of their profit will be invested back into their own company. Especially in the starting phase that can be quite hard for these entrepreneurs.
“We want to be a true reflection of society”
City Deal Impact Ondernemen has as objective to boost this different way of entrepreneurship. Their goal: realising an economy based on sustainability and inclusivity. Three ministries, forty municipalities, a significant amount of companies and authorities, the dutch Employee Insurance Agency (UWV) and the chambre of commerce are joining this City Deal. According to Struik, the society is at a tipping point. “We notice that the amount of companies who want to start social entrepreneurship is increasing. Rabobank is also speeding up when it comes to sustainable and social entrepreneurship. Since the government is coming up with specific measures to stimulate social entrepreneurship, I expect an acceleration of this development.”
Mulder: “Consumers, companies and government are starting to realise that you, also on individual level, have influence on what is happening.”
Social entrepreneurship is, according to Struik, “entrepreneurship plus. You are not only running a company, but also working with people who sometimes need some extra guidance plus you have to comply with different criteria to make it visible that what you’re doing makes a social impact.” “Yes, it is tough”, according to Mulder. Besides daily work and business operations – leading the team, landing orders, designing, developing smart working methods so every team member can join the team – our social mission will always be there. Also did he and Ho consciously decide to strive for a divers team. This is something many managers would stay away from, simply because a uniform workforce is easier. Mulder wants a big diversity on the work floor “We want to be a true reflection of society, so our employees teach each other different habits and views on matters.” And this is, according to him, “amazing and enriching.”
This was a Dutch article written by RaboBand (A magazine for retired employees of Rabobank), translated by Rabo Foundation.
Credits foto's: Iris Immink & Fraenck
Do you want to contribute together with Fraenck to creating a more inclusive society? Take a look at their website, they are a true inspiration for other companies. Read about how we contribute as Rabo Foundation to a more inclusive labor market.