— The contest includes projects that address economic, environmental, and social objectives. Statistics from recent Enactus projects show an increase in the number of socially oriented projects. What triggered this?
— Though subtle, it is particularly noticeable in the international Enactus program: teams brutally exploit the element of political correctness. The juror finds himself in a difficult situation when he is shown, for example, starving children in Africa: it is difficult to vote against the project or give it a lower score, even if the project doesn’t represent entrepreneurial values. As a result, the decision is emotional rather than rational, and such projects receive more points than projects based on economic principles, such as the idea that by lowering investment you can tackle bigger problems and generate more revenue. But if you were in America, where the business climate has existed for a long time, everyone understands that it is necessary to compete. In Russia, we have historically developed community relations: we help those close to us: this is an implicit advantage. Perhaps this is why the practice of the Russian division took on a tone of “spread the wealth”.
— It wasn’t formed with the help of certain mechanism of stable, self-sustaining business systems, and collecting money for the poor. The main problem with the current state of affairs at Enactus is that projects don’t outlive the people who create them. Currently, Enactus isn’t using its full potential to explain entrepreneurship laws. We want to change this.
— What do you plan to do?
— First, we plan to review evaluation criteria for projects in the Enactus Russia branch, placing sustainable projects and economic development indicators at the forefront. There are many sustainability projects, but not current evaluation criteria for them.
We presented a virtual business incubator to the international Enactus branch and received approval for implementation. So in Russia, we are presenting Strategyzer.com, which allows you to turn an idea into a business strategy and have a clear understanding of the niche, human resources, costs, as well as the necessary communication in different project stages.
— And how much are niches considered on a perspective market? Given its title “niche products and services”, it would seem that they are not focused on a wide consumer audience. Is there a scaling process?
— In fact, niches can be quite sizeable. For example, I’ve heard Alibaba company executives say that about 100 million Chinese people are ready to try condensed milk branded like it was during the 60s in the USSR. This is a standard niche product, but there are just so many Chinese people! At Enactus, we have to teach startups how to determine whether there are enough consumers in that niche, and where they should plan to pitch their product. And we also provide them with techniques to determine the least expensive way to identify a market that would be interested in the product.
For example, at Mabius, we are the first Russian food startup accelerator that uses hypothesis-testing technology and where entrepreneurs lay the basis for their plans, with the help of social media marketing. In fact, by knowing the offline community, they can accurately estimate the niche size. We do all of this research at our own expense. By checking the overall project, we make the investment decision whether or not we work with the startups and develop the product, or if at this stage, our investment is complete. If a startup successfully passes through all testing stages, then it is ready for investment. And we also plan to offer Enactus the use of the same technology.
— What effect do you expect from the reorganization of the Enactus Russia?
— I believe that cooperation with Enactus has the serious potential to be even more profitable for large companies. In its current framework, Enactus solves the PR problem, as it has the opportunity to present itself as a socially oriented company. But that’s not all, we will create an operational tool, and as a result, Enactus will benefit its members.
The international Enactus branch isn’t satisfied with the current amount of financing (the organization’s business model is based on company membership fees). They want to be more helpful to business, and we have ideas how to do that. We have already unlocked such ideas with Enactus Russia, and such positive changes can be replicated at the international level. KPI will attract many new corporate event participants.
Another positive impact we see is the possibility of opening a corporate university. Enactus allows us to work closely with universities and form a database of graduates and the quality of their projects. Look at the best practices of global companies – they do not have their own universities. Corporate education is based on professional education institutions. For example Coca-Cola organizes a two-week introductory course to the profession in partnership with Dresden University. In this case, companies are able to carry out a tender and choose the best conditions and highest quality education. This will be beneficial to companies and organizations, and will provide Enactus with an additional source of income.
— What is your motivation as an entrepreneur and an executive of a large company?
— For NMGK, Enactus is primarily a search tool to find the most talented young people. Second, it helps solve companies’ problems (which is so far a hypothetical possibility, since we do not have quantitative data on solutions for difficult technology problems that businesses face). In theory, student teams provide a workforce that is competing for a price to conduct market research, for example. Third, Enactus provides access to universities, where we can conduct regional courses and qualification training for personnel. Once this system is set up, I will be able to recommend Enactus members, based on their statistics, to business managers. It should be easy to compare costs, especially if the company is from the FMCG, merchandising, R&D, or recruitment industries.
— Why do you believe in the success of reforming Enactus?
— Because it is economically advantageous.
As of January 2015 Ivan Sidorok is the Chairman of the Board of Directors of Enactus Russia.
In addition, Ivan is the Manager Partner and Co-Owner of the NMGK Group (Nizhny Novgorod Fats and Oils Plant), which is top three leader in the Russian market. Sidorok is also the founder of the Mabius Food Startup Centre, Russia’s first business accelerator specializing in gastronomy. The idea of Mabius is to co-create a food project along with entrepreneurs and big business.