Figure 8. The business model of 1kg
4.2.1 Social Entrepreneur
In remote villages in Yunnan, students have little access to things such as extracurricular books or such necessary items as school supplies like erasers or pencil sharpeners. In the past, kindhearted tourists occasionally have left stationery or money for these children. One tourist, in particular, Andrew began to wonder if he could find a means of encouraging more tourists to help those needy children especially those in more remote and impoverished areas. Motivated by the social values advocated by Wikipedia, an idea was given shape and Andrew drew plans to create a similar social gesture, leveraging the power of crowd to solve social problems, in particular, issues directly associated with poverty.
In 2004, Andrew launched a project called 1 kg on the internet. His plan was straightforward. The project he started encourages tourists to bring certain items such as children’s novels or stationary in their travel luggage, and then pass along these onto remote schools and impoverished children in need along their trip. To obtain optimal efficiency, Andrew launched the 1 kg website with namely two services. The first of which was to collect data on the beneficiaries of the program, and the second was to connect participants with beneficiaries. Andrew acknowledged that, although the help or supplies that one kind tourist may provide to a school is not much, the sum that all of the participating tourists can provide is great. Besides, all such kind guests are—no matter their size—have a certain immeasurable value.
Travel lovers recognized Andrew’s idea in no time. In the first year alone, tourists coming from more prosperous areas in China such as Guangzhou, Shanghai, and Beijing organized more than twenty voluntary trips to such impoverished areas in China as Guizhou, Yunnan and Guangxi. More than 200 volunteers participated these initial projects and more than 10,000 items of stationery and more than 3,000 books were donated.
Andrew felt excited about this good response to his website, nonetheless, still recognized that much still needed to be done. One schoolteacher in Guizhou is reported to have said that “the [problem of a] lack of material[s] can be overcome, but the real problem [are] the backwards ideas and lag on information” (sic) (Wen 2004). Andrew realized that the 1 kg project to fulfill these needs must serve both the material and intellectual needs. In other words, the transport of knowledge and skills to those areas in need also need to become a service in which volunteers could participate. Andrew believes that children of impoverished places should also be given the opportunity to understand the world around them and broaden their own knowledge bases. Andrew also believes that travelers can interact with these children, passing on important ideas and knowledge.
In 2005, Andrew modified part of the guidelines for items to bring provided to volunteer travelers. He suggested that, for one, travelers should bring paper for letters and a stamped envelope with return address, so that the children and the tourists can keep in touch with each other and share ideas.
Numerous NGOs in China closed down or suffered because of lack of capital and donation since the start of the financial crisis. 1 kg was not an exception. In 2008, Andrew was not able to make payroll to his employees for 3 month because the funding for which they applied never arrived. At times, Andrew felt helpless and frustrated. Andrew pulled through, however. After that, Andrew registered 1 kg as a for-profit company, allowing it to operate for-profit projects to support its non-profit goals. This transformation not only solved the regulation problem but also secured sustainability of funding.
4.2.2 Customer Segments
Many of the customers of 1 kg are corporations that are interested in CSR; in order words, corporations will pay 1 kg to design the 1 kg box for disadvantaged children. Andrew explained that this business model’s customer segment is quite different from normal companies because the payers and receivers are different. Even schools that only received 1 kg box are characterized as their customers. Now 1 kg serves more than 1700 schools in China and organizes 14 social projects this year.
4.2.3 Value Proposition
Through three simple steps—pass, exchange and share--1 kg not only provides the travel experience value for its tourist customer, but also creates a positive virtuous cycle between travelers, students and corporations. Table 13 elaborates the value creation steps of 1kg.
4.2.1 Social Entrepreneur
In remote villages in Yunnan, students have little access to things such as extracurricular books or such necessary items as school supplies like erasers or pencil sharpeners. In the past, kindhearted tourists occasionally have left stationery or money for these children. One tourist, in particular, Andrew began to wonder if he could find a means of encouraging more tourists to help those needy children especially those in more remote and impoverished areas. Motivated by the social values advocated by Wikipedia, an idea was given shape and Andrew drew plans to create a similar social gesture, leveraging the power of crowd to solve social problems, in particular, issues directly associated with poverty.
In 2004, Andrew launched a project called 1 kg on the internet. His plan was straightforward. The project he started encourages tourists to bring certain items such as children’s novels or stationary in their travel luggage, and then pass along these onto remote schools and impoverished children in need along their trip. To obtain optimal efficiency, Andrew launched the 1 kg website with namely two services. The first of which was to collect data on the beneficiaries of the program, and the second was to connect participants with beneficiaries. Andrew acknowledged that, although the help or supplies that one kind tourist may provide to a school is not much, the sum that all of the participating tourists can provide is great. Besides, all such kind guests are—no matter their size—have a certain immeasurable value.
Travel lovers recognized Andrew’s idea in no time. In the first year alone, tourists coming from more prosperous areas in China such as Guangzhou, Shanghai, and Beijing organized more than twenty voluntary trips to such impoverished areas in China as Guizhou, Yunnan and Guangxi. More than 200 volunteers participated these initial projects and more than 10,000 items of stationery and more than 3,000 books were donated.
Andrew felt excited about this good response to his website, nonetheless, still recognized that much still needed to be done. One schoolteacher in Guizhou is reported to have said that “the [problem of a] lack of material[s] can be overcome, but the real problem [are] the backwards ideas and lag on information” (sic) (Wen 2004). Andrew realized that the 1 kg project to fulfill these needs must serve both the material and intellectual needs. In other words, the transport of knowledge and skills to those areas in need also need to become a service in which volunteers could participate. Andrew believes that children of impoverished places should also be given the opportunity to understand the world around them and broaden their own knowledge bases. Andrew also believes that travelers can interact with these children, passing on important ideas and knowledge.
In 2005, Andrew modified part of the guidelines for items to bring provided to volunteer travelers. He suggested that, for one, travelers should bring paper for letters and a stamped envelope with return address, so that the children and the tourists can keep in touch with each other and share ideas.
Numerous NGOs in China closed down or suffered because of lack of capital and donation since the start of the financial crisis. 1 kg was not an exception. In 2008, Andrew was not able to make payroll to his employees for 3 month because the funding for which they applied never arrived. At times, Andrew felt helpless and frustrated. Andrew pulled through, however. After that, Andrew registered 1 kg as a for-profit company, allowing it to operate for-profit projects to support its non-profit goals. This transformation not only solved the regulation problem but also secured sustainability of funding.
4.2.2 Customer Segments
Many of the customers of 1 kg are corporations that are interested in CSR; in order words, corporations will pay 1 kg to design the 1 kg box for disadvantaged children. Andrew explained that this business model’s customer segment is quite different from normal companies because the payers and receivers are different. Even schools that only received 1 kg box are characterized as their customers. Now 1 kg serves more than 1700 schools in China and organizes 14 social projects this year.
4.2.3 Value Proposition
Through three simple steps—pass, exchange and share--1 kg not only provides the travel experience value for its tourist customer, but also creates a positive virtuous cycle between travelers, students and corporations. Table 13 elaborates the value creation steps of 1kg.
4.2.4 Revenue Stream
On one hand, enterprise with good corporate social responsibility comes with the expense of designing and manufacturing 1 kg box. On the other hand, however, schools may apply for those 1 kg boxes with no costs to them. Andrew mentioned that manufacturing generates no profit under this model; profit is mainly generated through other steps in the design and creative process of the 1 kg box.
4.2.5 Social and Environmental Benefit
1 kg inspired the many people to visit elementary school in remote villages delivers goods and knowledge, fulfilling the demand of many remote schools. 1 kg leverages the power of social network to mobilize volunteers to serve more than 1,000 remote elementary schools in China. Each moth, volunteers with little instruction organize more than 30 social activities including volunteerism, donation and supporting education.
The 1 kg model solves the insufficiency of education resources in remote areas of China. Moreover, the 1 kg box program changes the ways in which we educate the children providing hands-on activities and interaction and communication with others. Currently, 1 kg dedicates to design the toolkit to design educational activities to benefit village students.
Besides making positive impact to students in small village, the 1 kg model also brings impact for those voluntary travelers. While broadening children's horizons and inspiring children's imagination and confidence, voluntary travelers are also inspired and motivated by those kids they have helped.
4.2.6 Channel
Most corporate customers simply reach 1 kg through their company websites to design 1 kg box; both 1 kg box applicants (the school customer) and those sending these boxes apply online.
4.2.7 Customer Relationship
1 kg considers its relationship with its customers highly valuable, and the company uses Ries’s principle of lean start-up in research and development. According to the principle, one should esteem that customer feedback during product development, recognizing it as an integral part of the startup process. One of the benefits of the principle is it ensures that the producer does not invest time designing features or services that consumers do not show interest in (Ries, 2011).
Andrew understands that many NPOs or Social enterprises design their product or services first before finding a sponsor (customer) to sponsor the activities. This way often fails because they often ignore what in which customers are actually interested. Thus, those NPOs or Social Enterprise often end up spend too little time and efforts to design their products or services well and spend too much time persuading sponsors or customers to pay for the bill. However, 1 kg coheres to the principle of finding sponsors (customers) first and then designing services or products accordingly, allowing 1 kg to spend more time on designing good products and services.
4.2.8 Key Sources
One key resource of 1 kg is its ability to design products that are appropriate with customer wants and needs. Different from other design company, 1 kg emphasizes empathy-embedded design. Andrew and his designers often make on-spot investigation in remote villages and schools to understand the true needs of students. Andrew points out that owning to lack of empathy and field study, many young entrepreneurs not only design business models similar to each other but are also carrying out products and services not suited well for their users.
4.2.9 Key Activities
Ordered by corporate customer interested in CSR, 1 kg designs 1 kg boxes, which are toolkits used to facilitate volunteer teachers to perform a specific educational activity. The box consists of all material need for the activity and an operating guide. Table 14 shows the boxes designed by 1kg.
Table 14. Products of 1kg
On one hand, enterprise with good corporate social responsibility comes with the expense of designing and manufacturing 1 kg box. On the other hand, however, schools may apply for those 1 kg boxes with no costs to them. Andrew mentioned that manufacturing generates no profit under this model; profit is mainly generated through other steps in the design and creative process of the 1 kg box.
4.2.5 Social and Environmental Benefit
1 kg inspired the many people to visit elementary school in remote villages delivers goods and knowledge, fulfilling the demand of many remote schools. 1 kg leverages the power of social network to mobilize volunteers to serve more than 1,000 remote elementary schools in China. Each moth, volunteers with little instruction organize more than 30 social activities including volunteerism, donation and supporting education.
The 1 kg model solves the insufficiency of education resources in remote areas of China. Moreover, the 1 kg box program changes the ways in which we educate the children providing hands-on activities and interaction and communication with others. Currently, 1 kg dedicates to design the toolkit to design educational activities to benefit village students.
Besides making positive impact to students in small village, the 1 kg model also brings impact for those voluntary travelers. While broadening children's horizons and inspiring children's imagination and confidence, voluntary travelers are also inspired and motivated by those kids they have helped.
4.2.6 Channel
Most corporate customers simply reach 1 kg through their company websites to design 1 kg box; both 1 kg box applicants (the school customer) and those sending these boxes apply online.
4.2.7 Customer Relationship
1 kg considers its relationship with its customers highly valuable, and the company uses Ries’s principle of lean start-up in research and development. According to the principle, one should esteem that customer feedback during product development, recognizing it as an integral part of the startup process. One of the benefits of the principle is it ensures that the producer does not invest time designing features or services that consumers do not show interest in (Ries, 2011).
Andrew understands that many NPOs or Social enterprises design their product or services first before finding a sponsor (customer) to sponsor the activities. This way often fails because they often ignore what in which customers are actually interested. Thus, those NPOs or Social Enterprise often end up spend too little time and efforts to design their products or services well and spend too much time persuading sponsors or customers to pay for the bill. However, 1 kg coheres to the principle of finding sponsors (customers) first and then designing services or products accordingly, allowing 1 kg to spend more time on designing good products and services.
4.2.8 Key Sources
One key resource of 1 kg is its ability to design products that are appropriate with customer wants and needs. Different from other design company, 1 kg emphasizes empathy-embedded design. Andrew and his designers often make on-spot investigation in remote villages and schools to understand the true needs of students. Andrew points out that owning to lack of empathy and field study, many young entrepreneurs not only design business models similar to each other but are also carrying out products and services not suited well for their users.
4.2.9 Key Activities
Ordered by corporate customer interested in CSR, 1 kg designs 1 kg boxes, which are toolkits used to facilitate volunteer teachers to perform a specific educational activity. The box consists of all material need for the activity and an operating guide. Table 14 shows the boxes designed by 1kg.
Table 14. Products of 1kg
4.2.10 Key Partners
The key partners of 1 kg can be categorized by three: local partners, corporation partners and media partners. Table 15 lists the partners of 1kg.
Table 15. Partner list of 1kg
The key partners of 1 kg can be categorized by three: local partners, corporation partners and media partners. Table 15 lists the partners of 1kg.
Table 15. Partner list of 1kg
4.2.11Cost Structure
Owing to leverage the power of volunteers, 1 kg is able to reduce human costs on delivering its product. Moreover, many volunteer creates content on its social network platform also reduces 1 kg marketing costs. 1 kg’s main cost is the design fee it pays to its designers.
4.2.12 Social and Environmental Cost
There is a risk with the 1 kg model of wasting resources if schools use those boxes recklessly or arbitrarily. In order to solve this problem, 1 kg monitors the use of 1 kg boxes they send. For example, schools may only apply four boxes in the first round. Next, the schools have to certify that all boxes were properly used so they may apply additional boxes.
Many people who want to be a change agent perhaps may not able to identify the true social problem, because they only hear the problem from someone else or see the news of social issues on television. Thus they tend to think out similar value proposition. Therefore, 1 kg encourages change agents to leave their comfort zone and walk into remote villages. 1 kg facilitates those change agents to live in the remote schools to see the true face of remote schools so change agents would be able to identify the true demand of education resources.
Owing to leverage the power of volunteers, 1 kg is able to reduce human costs on delivering its product. Moreover, many volunteer creates content on its social network platform also reduces 1 kg marketing costs. 1 kg’s main cost is the design fee it pays to its designers.
4.2.12 Social and Environmental Cost
There is a risk with the 1 kg model of wasting resources if schools use those boxes recklessly or arbitrarily. In order to solve this problem, 1 kg monitors the use of 1 kg boxes they send. For example, schools may only apply four boxes in the first round. Next, the schools have to certify that all boxes were properly used so they may apply additional boxes.
Many people who want to be a change agent perhaps may not able to identify the true social problem, because they only hear the problem from someone else or see the news of social issues on television. Thus they tend to think out similar value proposition. Therefore, 1 kg encourages change agents to leave their comfort zone and walk into remote villages. 1 kg facilitates those change agents to live in the remote schools to see the true face of remote schools so change agents would be able to identify the true demand of education resources.