Posting in Design
BARCELONA -- The Madrid-based IOU Project joined 10 changing-the-world start-ups in the Unreasonable at Sea program, which is giving a new meaning to the phenomenon 'EntrepreneurShip.'
BARCELONA -- The true story of 11 tech-based start-ups picked to live on a boat, work together, and incubate their businesses for 100 days, to find out what happens when an international group of minds focus on one thing: saving the world.
The last weekend of April, the Unreasonable at Sea ship made its final docking in Barcelona, after an intense journey to 13 countries with mentors the likes of Archbishop Desmond Tutu and the founders of TedX and Wordpress. Each of the 11 Unreasonable at Sea start-ups -- chosen among 1,000 applicants -- looks to leverage technology to solve a deep global problem, such as pollution and limited access to food, water and medicine.
According to Epstein, the 11 companies have already generated tens of millions of dollars in revenue and are operational in more than 30 nations. "What unites them is a shared belief that their technology will help define progress in our time and a common eagerness to experiment in what it takes to scale globally," Unreasonable founder Daniel Epstein said from 2,000 nautical miles off the coast of South Africa, when SmartPlanet first chatted with in February.
Spain was the only country to have two start-ups on-board. One was the IOU (I-Owe-You) Project, a clothing e-tailer which uses its website to link weavers, artisan clothing manufacturers and the end wearers in a worldwide measure to beat out factory machines that are mass-producing millions of meters of the same fabric and cookie-cutter clothing. C.E.O. Kavita Parmar, a fashion designer, created the IOU Project out of sheer frustration because she feels the industry has become about being faster and cheaper, with quantity trumping quality. She argues that machine-based design leads to poverty, lost jobs and sameness.
"The IOU Project’s mission is to promote responsible consumption by disrupting and transforming existing supply chains into 'prosperity chains,' in which products are embedded with full traceability from artisan to consumer," says Parmar. She says by knowing the entire supply chain, buyers can be rest assured that their clothing was not made with child labor or by mistreated, under-paid workers, for which all of the big three -- Gap, H&M and Inditex, which owns Zara -- have at least been investigated. Also, without the overhead cost of running stores, IOU can pay the artisans more, and charge the shopper less.
The members of the 18-month-old company truly relished their time on the entrepreneur ship. "To be part of a community of entrepreneurs with the same drive to change the world around them has been a growth experience," says Parmar. Even before setting sail, she found the Unreasonable team truly understanding of the unique challenges faced by a for-profit social enterprise, particularly one that is lean and self-funded. The access to Epstein and the other mentors was "a real luxury for someone who is from a country with very limited access" to entrepreneurs at that level of collaboration. This includes 20 mentors who are helping IOU and the other start-ups to expand their business, particularly to the 13 countries they've visited, including China, India and Ghana.
Parmar told SP of the challenges with running a start-up in Spain. While she says Spain in general does not have a large entrepreneurial scene, it's especially bad in the fashion and supply chain sectors, leaving her and her team with a sense of being isolated in their venture. She describes starting a company in Spain as bureaucratically painful, particularly when compared with the U.S. and Northern Europe, where the team has built start-ups before. She also says that finding an angel investor was very difficult because the Spanish investor community is "very traditional," relying usually on banks as the sole funding channel. However, Spain was attractive to them because they could call on their personal network of family and friends, as well as what she refers to as a "big pool of very talented and relatively cheap designers and engineers."
While the Unreasonable itinerary was set by the Semester at Sea program, with which it shared the ship, it was fortuitous to end its journey in Barcelona. As Epstein says, "I think it was incredibly serendipitous for us to culminate the entire program in Spain. Spain is a country hungry and ripe for an entrepreneurial renaissance."
One of the most unique points of Unreasonable at Sea is that it only accepts for-profit world changers and maintains a stake in the profit of each. This especially stands out in Europe, where incubators are nearly all publicly funded. Each two- to three-person team has the assumed, all-inclusive cost of about $100,000. Instead of these entrepreneurs putting up that kind of cash, Unreasonable claims a stake of either six percent equity in the venture or up to $100,000 in equity, whichever is less. If, by halfway through the journey, a team is unhappy with the service provided, they can disembark, owing nothing. However, in the maiden voyage of Unreasonable at Sea, none of the teams jumped ship.
Epstein says this makes sure that the Unreasonable team, mentors and the success of the program as a whole are intrinsically linked with the success of the 11 start-ups. This way, "we are in this for the long haul," he says, chuckling at his pun.
Photo: Semester at Sea
Apr 28, 2013