I’m pleased to report that on January 14, 2015 my wife and I welcomed our little girl, Sofia Grace, into this world. The past few weeks have been quite a blur, so I’m thankful to my friend Landon Yoder for writing the following guest post about his experience launching a social enterprise in Kosovo.
Ride a time machine back to Kosovo in 2009 and chances are good you would land in a smoky coffee bar. Around the room men of various ages nurse identical cups of espresso. Racy music videos stream from a TV bolted to the wall. Half of the people you see are unemployed. If their tabs were proportional to the national economy, a third would be subsidized by loved ones working abroad or from aid organizations working in Kosovo.
A Coffee Shop in Kosovo
A short walk from several bars like the one described above, I partnered with Lacey Yoder to launch an American-style bakery and café. In doing so we challenged not only other cafés but also prevailing ideas about value creation. Sweet Bean Bakery & Coffeehouse served its first espresso on January 1, 2010 and nine months later hit positive operating cash flow. The model had become a self-sustaining platform.
Sweet Bean’s mission had two parts:
- Model an alternate reality for local workers, consumers, and suppliers
- Equip local youth with the skills, experience and confidence to lead ventures of their own in the future.
In short, the vision was to blend the simplicity of a lemonade stand and the rigor of a corporate leadership rotation program.
Our inspiration to leave stable jobs in Washington, DC and move to Kosovo came in part from an entrepreneur and philanthropist named Michael Holthouse. A couple years earlier Holthouse had launched a foundation to train at-risk youth in America about entrepreneurship. His flagship program, called Lemonade Day™, teaches kids the basics of management in a tangible way that stays with them for life.
More Than Coffee
In its first year and a half, Sweet Bean recruited and trained 18 future leaders. Besides learning to bake, serve and clean, they also completed special assignments in accounting, marketing, and operations; they hosted a local lawyer and tax advisor for guest lectures; and they toured the facilities of suppliers around the region. We even took an outing to the ballet.
At the end of their initial contracts, some of the original workers became managers and began to help train and supervise new recruits. The awareness that we were doing something different, taking social and financial risks, helped bond the team together. A corporate culture took shape around several key values like experimentation, integrity, fairness, fun and excellence.
The fruit of this all was that Sweet Bean became a regular stop for professionals and school kids, for work meetings and dates, for locals and for expats. Women and children made paid frequent, extended visits. Aromas of espresso and pastries, not cigarettes, filled the air. Artwork, books and newspapers fed our customers’ curiosity and productivity. Gradually, the employees began to operate the business with minimal supervision, first for a few hours at a time and eventually for periods longer than a month.
Today most Sweet Bean alumni are completing college or grad school, and some of them continue to work as managers. Currently Sweet Bean continues to operate as a social enterprise under new ownership.
Lessons from Kosovo
Three lessons emerged from Sweet Bean that I believe also apply to other markets and business models.
1. Business can open windows into an alternate reality
People in Kosovo are proud of their small country yet many also felt confined and stifled. When they stepped into Sweet Bean, Kosovars saw familiar building blocks from their own society arranged in a novel way. They saw new ways to tap the latent value in local ingredients, materials, and talent. They saw a new way that things could be.
2. Business can set new standards
Sweet Bean helped to adjust expectations in the local market. Evidence of this came in the feedback from customers that Sweet Bean was the “different” experience they had craved ever since a trip to Western Europe. On payday, workers beamed with pride and sometimes confided that their previous jobs had sometimes paid only part or not at all. Our team took pride in helping to build the profit and loss statement each month and knowing that the books were correct. Suppliers never fully recovered from their surprise that Sweet Bean always paid in cash despite the common habit of paying one another “eventually.”
3. Scaling can amplify both good and bad effects
Part of the reason Sweet Bean surprised people is that the country’s large, visible employers were widely understood to practice fraud, cronyism, and command-and-control management. Although Sweet Bean never grew to that scale, it demonstrated the potential to propagate positive values in a similar way. For instance, teams from other cities in Kosovo and in neighboring countries conferred with our team while planning startups of their own.
Expect a pause if you ask Landon where he’s from. That’s because after living in five countries and as many US states, he has learned to thrive just about anywhere. After returning from Kosovo, Landon earned an MBA from Thunderbird School of Global Management. As a student, he advised several early stage startups and conducted due diligence research on behalf of investors in the Phoenix area. He currently lives in New York City.
Photo Credits: Landon Yoder and Umer Shabib