THE BLOG
09/11/2013 11:39 am ET | Updated Nov 11, 2013

When Two Social Enterprises Cooperate, the Sum Is Bigger Than Its Parts

Paolo Richter was elected Social Entrepreneur of Switzerland in 2009 by the Schwab Foundation. With his program Bicycles for Africa, his social enterprise Gump & Drahtesel delivers second-hand bicycles from Switzerland to various African countries. Professional workshops in Switzerland and Africa ensure that the bikes remain in use as long as possible as an attractive and handy means of transport. In addition, training courses for bicycle mechanics are offered, which create attractive jobs in African villages.

In 2011 it was my turn. Paolo was a member of the jury, when our company South Pole was recognized by the Schwab Foundation for having supported hundreds of sustainable CO2-cutting projects around the world by generating and selling carbon credits. The idea was born very fast: Let's cooperate! Let's boost the number of bicycles sent to Africa using co-financing from the carbon markets, where customers address their CO2 footprint by investing in projects elsewhere.

But as usual in the life of a social entrepreneur, barriers started to build up and prevented a quick realization of the cooperation idea. First of all, the impact of every CO2-cutting project needs to be calculated according to a detailed and complicated UN-approved methodology -- but none of these methodologies fully matched our case. Second, we realized that the detailed monitoring of each bicycle would be a nightmare -- try collecting the performance data of 13,000 bicycles scattered across seven African countries. Third, it became clear that the costs of a full U.N. certification would eat up a good part of the money that should actually be used to deliver bicycles.

Give up? Of course not. After several meetings and discussions, we created the idea of launching "double-up" certificates: Instead of measuring and certifying each and every kilogram of CO2 saved by the climate-friendly bicycles, we decided to extrapolate the likely emission reductions achieved using average values and sales and maintenance records available at the mechanics shops. In order to guarantee 100 percent CO2 neutrality to customers, each emission reduction from the Bicycles for Africa program is paired with a U.N. certified emission reduction from another project.

With this concept we were finally able to launch the cooperation: Without losing much money on transaction costs, we created the possibility for clients to go 100 percent carbon by giving more Africans to a reliable and climate-friendly means of transport.

This example shows that in the case of two social entreprises cooperating, the sum can be bigger than its parts. The new product advances the cause and the reach of both companies simultaneously -- without either company changing much of its existing business model. Social entreprises around the world, unite!