A Revolutionary Bank
Social entrepreneurship is all about the triple bottom line, which is maximizing the positive impact on People, minimizing the negative impact on the Planet, and generating sustainable Profit. In the landscape of social businesses that accomplish these goals, there are so many inspiring stories. We want to share one of these galvanizing stories so you can realize how this world is being changed one social business at a time, and perhaps be inspired to yourself challenge the status quo and contribute to a healthier planet and society.
David Katz is the perfect example of a new kind of entrepreneur we call social entrepreneurs. After successful ventures in the more traditional business world as an entrepreneur, he decided to sell his previous business and invest his earnings to launch, along with Shaun Frankson, a new type of bank. A bank meant to help the poor people of this world AND the devastated environment of our planet. A revolutionary bank. The Plastic Bank.
The Plastic Bank was founded in 2013 and its mission is basically to prevent plastic flow in the oceans, a truly growing problem our planet and all its species are facing. The motto of the organization is: Gather together, reveal value & love people. We can immediately understand the connexion they have with the triple bottom line. After two years of preparing their business process, identifying the target countries in which it wanted to have an impact, and finally making sure they had carefully planned their operations structure, the Plastic Bank launched operations in its first country. In 2015, Haiti is where the social enterprise decided to launch its innovative concept. The following year, the Plastic Bank signed its first major European customer, but most importantly, it expanded operations in a new country, the Philippines. So far, the Plastic Bank currently has over 2000 registered plastic collectors, who basically live off this work, and can support their families and hope for a better future for their children.
Internally, the organization currently has eight people working worldwide, along with about twenty external contributors, plus thousands of collectors in Haiti and the Philippines who earn a living through this social enterprise. At this point, it is probable you are asking yourself a very specific question: What does the Plastic Bank do and what makes it a business? Here is the answer.
Business Process and Operating Structure
First, let’s recap what we know so far. Plastic Bank is an organization that gives opportunity to others, mostly poor people in developing countries to stand-out and provide for their families. These people are called collectors, as their occupation is to do beach clean ups and recover as much plastic as possible that is polluting their communities and their countries.
The priority of Plastic Bank is to educate and help people first, before thinking of making any financial profit. They invest a lot of time and energy in educating local populations, as they truly believe in the saying that to give food to someone will prevent him or her of starving today, but to teach that person to cultivate the land will prevent him or her to never starve again.
Now that we better understand the social mission of the Plastic Bank, let us dive and understand how the business is set up and how it operates. The first step of the process for them, when they decide of entering a country, as they did for Haiti and the Philippines, is to work with the local authorities in order to upgrade existing recycling centers. They invest time and resources to make sure these recycling centers have the structure and the capacity to receive large amounts of recuperated plastic. Once this step is ensured, the Plastic Bank can reach out and train local people who want to get out of poverty while working to make their country and their planet a nicer and healthier place for them and their children. These people become certified plastic collectors and work to recuperate all the plastic they can from the beaches of their communities. Once they have collected a sufficient amount of plastic and want to call it a day, they simply go to the recycling centers and exchange the recovered plastic for financial compensation. This compensation used to be cash, but because of all the corruption and violence around the cash system, Plastic Bank has developed a compensation system that ensures food and essential goods for the families of these collectors. This new system is built around the blockchain technology. We will get into this innovative system shortly. Before, let’s make sure we finalize the business operations overview, as we have only seen the first part of the process, the input of raw material, which is recuperated plastic. We still need to understand what exactly is the output of transformed materials, and how the Plastic Bank is able to generate revenues in order to be a sustainable enterprise, which is at the heart of what true social entrepreneurship is and should be.
Essentially, the output of this social business is transformed plastic, in the form of small pellets created from recuperated plastic, that is sold on the international plastic market. That part of the process is fully owned by the Plastic Bank, while the first part, that takes place in the recycling centers, is managed by local populations. It is basically the same process as with recycled paper, where recycling centers produce a type of recycled paper from all used types of paper and cardboard. Thus, the Plastic Bank invests in recycling centers in developing countries, so they are able to transform the recuperated plastics from beaches within their country into plastic pellets that can be sold on the international market, so other companies can invest and buy recycled plastic. Currently, the 3 largest companies partnering with The Plastic Bank are Marks and Spencer (UK), Shell (Netherlands), and Henkel (Germany).
There are two specific innovative strategies we want to focus in regards to this social enterprise. The first has already been mentioned, it is the blockchain technology that enables the Plastic Bank to compensate its plastic collectors and make sure they get out of the poverty cycle they sadly are caught in. This payment process is done through an exchange platform, which also provides a turn-key POS system for collection center operators and enables many innovative capabilities. Indeed, the Plastic Bank’s platform creates digital tokens, encrypted money, and functions like a bank for the poor “unbankable” populations, that account for billions of people worldwide. This platform facilitates the exchange of plastics for value and rewards that can be transferred within the financial ecosystem created by the Plastic Bank along with local partners. As you might have understood, the Plastic Bank App acts as a digital wallet for local populations in developing countries, where large majorities of people own cellular phones. These participants can then exchange these digital tokens for cash or products with the Plastic Bank’s exchange partners, who constitute the ecosystem created by the social enterprise, both in Haiti and in the Philippines, and as we will shortly see, in many more countries to come. Finally, this exchange process qualifies as a ‘Reward and Loyalty program’ for recycling, so it is not subject to currency regulations and thus help the participants escape all sorts of corruption that may take place within the local institutions.
The second innovative strategy we want to share relates to marketing, the true key to open any doors for market expansion. The Plastic Bank really thought outside the box and made a bold move. They developed the concept of social plastic and registered the term for marketing purposes. This means that any time in the future that you see the term Social Plastic®, you will know exactly where it comes from. This strategy enables the Plastic Bank to precisely identify a type of verified recycled plastic, which allows businesses and consumers from around the world to purchase a specific type of plastic, recycled plastic, allowing these agents to directly contribute in solving the worldwide problem of ocean plastic. Furthermore, this is a great way of getting large corporations involved in the effort, incentivizing them to purchase Social Plastic® and focus on their corporate social responsibilities. In a way, this new type of plastic created by the Plastic Bank enables a democratization of plastic consumption around the world, allowing consumers to demand products made of Social Plastic and support businesses that purchase this kind of plastic. Everyone needs to understand that true democracy, in this 21st century, comes through the votes made everyday with your dollars spent. Consumption is true democracy. Will you vote for Social Plastic in the future? We truly hope so.
Looking Towards the Future
In summary, the Plastic Bank works in solving two major problems, poverty and pollution. They are able to do that through education about the environment and on the benefits of recycling. Looking towards the future, the social business will continue its growth as it is planning to launch operations in Brazil and Indonesia, for the moment, and hopefully one day they can have operations in every country of the world as the demand for this new kind of plastic grows through consumer consciousness. Also, the Plastic Bank and its collaborators have many capacities and objectives they are dedicated to develop, such as expanding Social Plastic supply exponentially, collecting data in real-time, tracking volumes throughout the supply chain, tracking metrics on environmental and social impact, guaranteeing supply-chain transparency, eliminating corruption and increasing overall efficiency. Humble Dreamer sincerely feels that the Plastic Bank is an amazing example of what true social entrepreneurship really is and what should be the new business model for the new millennia.
Finally, we would like to thank Shaun Frankson and David Katz for the information they contributed and that made this article possible. To all Humble Dreamers out there, we hope that this story gave you some inspiration of what can be done to make our planet a healthier one, while helping others caught in the cycle of poverty find their way out and enjoy life as it should be enjoyed.
Here are a few links to learn more about the Plastic Bank, starting with their website, and see some of the amazing things they have been doing over the past years.
by Tobi Rodrigue
Photo By: Plastic Bank
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