by Ying Chen  on Thu 26 Jan - 0 Comments
Categories: International Development, Social Finance, Start-up

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5 years ago, when I was ~2 years into a career of management consulting followed by private equity, I realized that I won’t die of hunger for this life. This simple realization got me seriously re-thinking my life purpose.

The soul-search of that purpose was painful and took a while, but it could be now summarized in a phrase – “to reinvent lives.” This is a very personal statement: I can clearly tell those moments in my life that I have struggled, stumbled and reinvented my life over and over again. Born in a small rural town in China, my personal development was never linear, but instead, composed of a series of reinventions followed by exponential and transformational growth. The question is, how I should further reinvent my life, and in that process, best leverage my skills and passion to help others experience the transformational reinvention process?

My first instinct on how to fuel reinvention was through microfinance. Finance and social impact – it comes to me naturally. I have spent substantial time before and during business school in experiencing different models in Asia, India and Latin America, and working with Enterprise Solutions for Poverty (ESP) to explore opportunities and partnerships in China. I further spent a summer with Credit Ease, a leading innovative inclusive finance company in China, to help scale its rural microfinance operations.

However, I gradually realized that a financial product itself is insufficient for self-reinventions. Or to put it more broadly, any base-of-pyramid product alone is insufficient. Effectively distributing these products to the hands of the needed in a sustainable and scalable way is what matters in the end. We shouldn’t focus only on the product. We should also focus on the delivery organizational model (the logistics, the supply chains, and services, the talent program and the cost structure), which is severely lacking. I also think that we should somewhat change the product-focused mentality, as in many situations, delivering one product alone down to the BoP doesn’t generate sufficient volume to be cost-effective. Without a distribution platform of sound economics, resources get wasted and nothing gets done.

So that comes to my new purpose – to build a for-profit, base-of-the-pyramid retail and distribution platform. To be cost-effective, it has to be cross-product category. I will start with consumer products, because the demand there is more obvious and stable. The immediate problems to solve in consumer products are, (1) they are 15-50% more expensive than their urban equivalents; (2) they have as high as 30-50% fake and non-safe ratio. And we will provide low-cost but authentic products from secure channels by accumulating volume and cut through middle-layers. Rural mom-and-pop shops are our direct customers. As our model sticks, we can then expand to bring in other great BoP initiatives, such as energy savings, water purification, nutrient enhancement, medicines, financing, as well as insurance directly. We are also testing a retailing model for products that are not currently covered by rural mom-and-pop stores.

Together with Yixin and Gary, my HBS classmates, as well as a group of >10 extremely talented and passionate college grads from rural China (special thanks to Bang, Dongdong, Zhiguo, Shibo, Tingting, Yijie, Jianglin, Yanran, Fan, Zhiyi, Xiaolu, and Wentao), I spent a month in >35 rural villages across Hunan, Hubei and Anhui provinces in China this winter. I became more humble as I know so little about rural way of lives, and I think I should simply spend more time with them learning what they think and how they live. I also become more passionate about building rural distribution channels to enable reinventions, not because it is an easy thing to do (it is actually much more challenging than I initially thought), but because there are many like-minded people, who want to push this vision to the next level. I am not alone.

Next step: prepare my business plan during this semester, and execute the plan into reality after graduation. Hopefully get some financing from sponsors sharing our visions. 

This is not that I am still young and want to chase my dreams for a few years. No. This is a solid decision on a great long-term cause, and the opportunity is real, and I want to make it happen.

Though a very local, down-to-the-earth initiative, if you are interested in helping us grow this movement of reinvention, we should talk. My email is ychen@mba2012.hbs.edu.

Born, raised and educated in China, Ying Chen is a second year at HBS. Prior to HBS, he worked at consulting and Private Equity. Ying had also worked extensively with base-of-the-pyramid institutions including Kiva, SKS, Enterprise Solutions For Poverty, Alibaba Financial, and CreditEase. His current endeavors center around innovative rural distribution & retailing and inclusive social finance.