010 – Reluctant Entrepreneurs

[00:00:00] David: Hi and welcome to the IDEMS podcast. I’m David Stern and I’m here with the IDEMS co founder, with my IDEMS co founder Danny Parsons. Hi Danny.

[00:00:16] Danny: Hi David nice to be here. What’s, what’s our topic today?

[00:00:20] David: I think this is the first time we’ve had a podcast together and so I’d like to talk a bit about where IDEMS came from and particularly from your perspective.

So, I suppose, I was at Reading University and you were jumping around in different places, at Stats4SD, a Partner, Oxford and I came to you and said I think I want to set this up, but I can’t do it alone. Are you interested? And…

[00:00:50] Danny: Yeah, that’s… that’s how we started. And yeah, we’d been working together for quite a while.

[00:00:57] David: Yeah.

[00:00:57] Danny: As you said, I was working on a research project at Oxford at the time, but we were still working closely together on that with you in Reading, and before that we were working together in Kenya on…

[00:01:09] David: A whole range of things.

[00:01:11] Danny: A lot of education projects, and then other things, the climate work and data analysis work. So we’d been working together for quite a while and I had been exposed, I guess, to quite a really broad variety of different areas of work, especially in Kenya from the mathematics and education, to development studies and agriculture focused work and yeah…

[00:01:37] David: And you got thrown in the deep end occasionally, not just in Kenya, in Ethiopia, in Ghana. Those, those are maybe other stories for another podcast.

[00:01:44] Danny: Yeah. Yeah, yeah. I got, um. I got thrown around a lot of countries, which was very exciting for me. A lot of really interesting experiences; learning a lot about how different things worked and seeing a lot of different projects that you were involved in, but other people are involved in, other organizations, and seeing how they work. So that was a real, yeah, a real learning experience. And I really enjoyed that variety of, of, of work.

I was just really interested in doing lots of different things and learning as much as possible and I, the only thing I was conscious about was not wanting to, to get stuck into something specific because I, I knew I didn’t know what area I wanted to go in if I was going to narrow down into something. And so that was the only thing I was trying to to…

[00:02:34] David: To avoid.

[00:02:35] Danny: Avoid.

[00:02:35] David: And I, I was quite good at helping you avoid that by introducing you to different people who I wasn’t necessarily working with, but I thought, oh, they could use your skills. The Corruption Project, I had very little to do with. You drove that forward with Oxford and Sussex, or Essex?

[00:02:51] Danny: Yeah, with Sussex…

[00:02:52] David: Sussex, yeah.

[00:02:52] Danny: …University and other collaborators in Cambridge. And even in the time in Kenya, you were working with the Development Studies Group there as well, and that was very interesting, different teaching ideas and software development, and working with computer science students at Maseno University who were interested in stuff.

And, you know, that wasn’t something I had really that much experience of apart from doing a bit … of computer programming at university but just kind of jumped into and…

[00:03:24] David: Yeah and recognized that your core skills were enabling you to actually help in that context.

[00:03:29] Danny: Yeah, exactly, yeah… As was discussed in your podcast, explaining the IDEMS acronym, that Mathematical Sciences. I think it’s also not just the sort of field, but the actual, that kind of way of thinking and that kind of mathematical thinking they call it, but all those kinds of skills that come with that, which I think gives you a bit of confidence to go outside your comfort zone more often.

[00:03:55] David: I would argue, in this transdisciplinary way, where you were not coming to say, I’m an expert in computer science, but coming to say, well, I can probably contribute if you can work with someone, and that’s sort of how it often works.

Let’s fast forward a bit to actually then, okay, so we had a long history. We’ve done lots of fun things together before, and I approached you with this crazy idea for IDEMS.

[00:04:21] Danny: You did. And yeah, it was, it wasn’t something I had thought about for myself, going into becoming a business owner. It sounds very unusual. I was doing this research work at the university at the time. And that felt sort of…

[00:04:37] David: Comfortable.

[00:04:38] Danny: Comfortable, yeah. And that was within the area I was had been doing work in. So, this was a sort of, an unusual opportunity. But I think, coming back to the sort of variety of things I was interested in, when we discussed the scope of the work that we were thinking about for IDEMS and the sort of vision and the big picture. I guess that was the other thing that we worked quite well together on, was sort of being able to focus on specifics of a project and individual things, but also seeing the big picture and sort of see how a lot of seemingly disjoint bits of work and projects actually did have a loose connection to each other and tied together into into sort of coherent aim, at least, and vision. And so, when I was thinking about it, and thinking about, you know, maybe other options that I might have for my career path then they all felt quite narrow compared to IDEMS.

And I think it was also that ambition. I think that was the thing that attracted me as well. That the only interest I had really was contributing to something that could be quite big and could make a really big difference and and you don’t see that very often.

[00:05:55] David: And let’s be clear on this. We don’t really talk much about that original dream. And at that point it was just a dream, but it was this idea that actually, and I think you arrived at a similar conclusion, that every other route that I could take, I had to be narrow. I had to sort of have a small influence. And if I actually wanted to influence the things that I cared about deeply, the only way to do it was to dream big. And that’s where, once I recognised that and I started thinking, okay, well, what would it mean to do that? I realised that I couldn’t do it alone.

And you were the only person who I had who I thought, you get it. And that’s where, when I presented it to you, I was surprised at not only how quickly you said yes, because it was crazy, and you actually understood quite quickly and said, yes, actually, this isn’t going to be easy, but I can see why you’re doing it. And you understood me well enough and where I’d come from to understand where this had come from.

And more than that, you immediately added value to all the discussions, all the thoughts I was having about what to set up, that I was really confused about at the time, and you really brought me down to ground on some of these. And you’ve been doing that continuously since.

[00:07:19] Danny: Yeah, and that’s, I guess, was, a bit of a surprise for me, because being much less experienced and not [having] done all the variety of things that you had done for as long a time. Yeah, it wasn’t clear to me that you needed another director and you had a very sort of clear, uh, vision already in a sense, but it was interesting the way you kind of explained, you know, wanting this to be not just your sort of own thing and a shared thing, which would I think enable it then to become something bigger and not just become something of an individual. I must say that was probably at the time when I was gaining all these experiences and basically saying yes to everything that was available to me as an opportunity and starting IDEMS was probably the last thing I just said yes to without, um, putting a huge amount of thought into what it could lead to because it was just an exciting opportunity and I thought, yeah, it’s worth, um, it’s something I couldn’t say no to, like all the other things. I couldn’t see a reason to say no, because it would be a great opportunity and experience anyway.

[00:08:28] David: And, and let’s be clear, you mentioned that you never saw yourself owning or running a business. We’re not really owners because of our legal structure. You know, we are directors, we’re responsible but the ownership is a bit complicated because of our legal structures: asset locked to a charity, which is part of the community interest company structures. But once you said yes, I think you were also surprised by the value you added in so many different ways, and we were clear from the beginning that we needed to be at least three directors, and we have failed to find a third director.

We’re trying to grow a third director, but we have failed to simply find one. And that’s maybe something worth just discussing a bit, that this sort of combination of experiences that we’d shared and other things. Somehow, we’ve never really had that right person. We’ve had, we’ve been close a couple of times.

[00:09:27] Danny: Yeah, and I think, as you said it wasn’t sort of your dream to run a business either. And I think we were quite I felt sort of not quite comfortable with that position at the start of being a entrepreneur or social entrepreneur because it didn’t kind of feel right. I sort of would have thought of myself working with a charity or working in the university on some research and impact projects.

And so, although of course we’re a community interest company and we’re not for profit and call ourselves a social enterprise, it is still a type of business. And that seems, you know, it wasn’t quite comfortable I think discussing that with other people who worked in the more traditional places for development kind of work. But, for me, once we saw what was possible that couldn’t have been done any other way and what, what we’re able to, how we’re able to try and do things a bit differently through IDEMS, I think then it really made sense. Then we could really explain it to other people.

[00:10:30] David: I think you’ve expressed that quite well in the sense that we were both, well, we wrote this, we were both reluctant entrepreneurs.

[00:10:37] Danny: Yeah.

[00:10:37] David: This is something.

[00:10:38] Danny: First year report.

[00:10:40] David: Our first year report. That’s how we described ourselves. And we didn’t feel comfortable with that part, but we knew it was necessary. So I think abstractly we discussed this and we knew that that was what we needed to become.

[00:10:53] Danny: And I think not wanting to do it in the same way as other people have done it, which is where maybe some of those negative connotations… Even the social entrepreneur I didn’t feel was a term I was comfortable with because I felt that gets quite misused and exploited by some people in sort of wanting to, appear that way, but actually doing things as normal.

[00:11:15] David: Exactly. We didn’t come into this and we can never sell out and become rich out of IDEMS’ success. That’s how it’s set up. And that’s not how we came into this. We came into IDEMS as a social enterprise because, as you framed it, because of the desire to contribute to something bigger. And actually to be able to see through the impact that, we were I would argue, that we were always on the periphery of in some sense, because we were never able to scale.

[00:11:43] Danny: Yeah. I think… If we think about now coming into the first year of IDEMS operating, there was, there was then some clear things that I saw that we could do that wouldn’t have been possible elsewhere. So there was a lot of projects that we were involved in, which had any or big or consistent funding behind them. And it’s not clear how those projects could carry on if, if you don’t have that behind them. And we were sort of able to balance out some projects where we had good funding for, and some projects where there was less funding for, and we were able to be that stabiliser to keep the projects going, and yeah, smooth out those inconsistencies of the funding. So that, I felt, was already in the first year something we achieved.

[00:12:31] David: this was a very conscious decision towards the end of the first year. We now were quite proud of ourselves. We were making enough of a profit and there was a crisis. I’m thinking of Francis and his PhD funding. Do you want to just mention that?

[00:12:45] Danny: Yeah. We have this, collaborator in Ghana, Francis, who had been working with us and in projects with the University of Reading for a long time and doing excellent work as a person on the ground in Ghana, but in lots of other countries as well where he was able to go. And he had sort of funding to do some of this work and funding through his PhD through a project and suddenly, I think, unexpectedly, that funding didn’t get renewed or didn’t continue.

[00:13:13] David: It got cancelled in the middle. This happens occasionally, but this was a big funded project, which had his whole PhD laid out as part of it, and then halfway through, in the middle of, of, of everything, it got cancelled.

[00:13:27] Danny: Yeah, and that’s, you know, I remember the colleagues in Reading wanting to do something about this. Well, there’s nothing they could, and they can’t just say, can we just send some money to this guy because he’s doing great work still. Well, that was by this project and that project doesn’t exist anymore. So, you know, where’s the money coming from?

[00:13:44] David: Exactly, they had their hands tied.

[00:13:45] Danny: Yeah.

[00:13:46] David: And actually we only found out about this three, four months later. He hadn’t been paid his stipend for about four months by the time we found out.

[00:13:53] Danny: Yeah. So yeah, it’s really, something that would be, I guess, disappointing to people living and working here, is sort of disastrous to someone there when that’s their whole income. I remember sort of also feeling, you know, reluctant to commit to that because it also seemed kind of unusual to me to say, well, we commit to this without us having the funding behind it. And it wasn’t just something we wanted to do to be nice. It was something we thought would be… Something that would pay off in the long run because of the value that he would bring to our work and bring in other work and so on. But, yeah, it did seem a bit, unusual and a bit of a risk for us to take. But yeah, we would’ve lost him to something else. He would’ve found some other work in other ways and be helping other people instead of carrying on still to this day with us…

[00:14:46] David: And doing the work he wants to do. We stepped in, there was the gap in funding we just covered that because at that point we were in profit. And over the next few years, he’s continued to work with us. He’s now set up GHAIDEMS in Ghana with a number of colleagues. But he’s been at least break even within IDEMS over the length of the period of time because he’s been involved in a whole range of other paid projects. He goes and he gives trainings. He’s been involved in all sorts of different components. And so it’s been a mutually beneficial relationship.

[00:15:17] Danny: Yeah, I think it’s taking that long term perspective that even from a financial perspective, that’s been good, that’s paid up.

[00:15:24] David: Exactly.

[00:15:24] Danny: It’s brought in the funds. But you could imagine in a university or another organization, if they were trying to evaluate that from a financial perspective, well, there isn’t the funds now for the next three, four, five months, so they wouldn’t be able to approve something like that.

[00:15:39] David: Exactly. They can’t make that investment and then recover it later. That’s exactly what a business can do. We were able to invest in him as a person and he’s contributing in ways which mean that that has been a good investment.

[00:15:52] Danny: Yeah.

[00:15:52] David: And this is where I think, you know, we were very much in our early years reluctant on this, but, but we’ve grown into that role. I’m now comfortable calling myself a social entrepreneur.

[00:16:01] Danny: Yeah.

[00:16:01] David: And it’s, something which has changed in how we’ve approached things.

[00:16:05] Danny: Yeah. And it’s also that flexibility that we were able to make that decision quickly and it was needed to be done quickly.

[00:16:12] David: Less than a week. I mean, we suddenly found out he’d not been paid for months on end. It was a decision which had a long time scale in terms of the implications for us. But we made it very fast.

[00:16:24] Danny: Yeah, and obviously we were a lot smaller at that point in our first year, so it was easier to be that bit more flexible, but I think that’s also what you get, still as a young organization. And I think we’ve kept lots of elements of that flexibility even as we’ve grown and obviously built in more structures.

[00:16:41] David: Yep.

[00:16:41] Danny: But that sort of reactiveness is really important and will continue to be important.

[00:16:47] David: Absolutely. And one last thing that I think I’d like to sort of get you to just mention in this first episode which is that we’ve talked about ourselves being reluctant entrepreneurs as we started. I want to dig into that a little bit more in the sense that you’ve mentioned this is not something either of us had ever thought we’d do.

But why, if we didn’t want to be entrepreneurs, didn’t we just set up a different structure? That’s important to come across, we knew we needed to be entrepreneurs, and we’ve seen some of the benefits of that thinking now through the example of Francis’s PhD. But it’s bigger than that, why did we need to be entrepreneurs?

[00:17:31] Danny: Yeah, that’s a good question. I think one of the things is this big vision and the big ambitions that we have. To be able to have the, the structures of the sort of business, but from a social impact perspective.

I think we felt that the other routes that were available that we had been involved in, like universities and charities, just didn’t seem to fit exactly what we were wanting to do, and the sort of big picture that we were wanting to achieve. And, and we are wanting to do things quite differently.

And that’s, that’s not easy through these more traditional structures. I think we’ve made it hard for ourselves with this, with the structures we’ve set up, because we’re halfway between this sort of we’re not a for-profit business, and we’re not a complete charity, and we’re somewhere on that spectrum, which I think we think should be a big advantage.

And I don’t think it’s recognised or valued generally in society at the moment as an advantage. You sort of get penalised from both ends. But I think we felt it was important that that’s the structure that should work. And we want to go with what we think should work. And hopefully it will in the future, and there are people pushing that even if it doesn’t right now. Instead of fitting in, we’re wanting to, to push and stand out.

[00:18:54] David: I really like the way you’ve explained this because we didn’t make that choice to make our life easy. We recognised the nature of the choice wasn’t making our life easy. But we feel for the ambitions, the big ambitions we’ve got, part of that is to demonstrate that another way of being entrepreneurial, where the social impact is considered differently, is part of how we were going. And I suppose there’s this tension between often social enterprises, community interest companies, are considered as focusing on a community, a local group.

[00:19:33] Danny: And I think it’s more in their ambition and, yeah, and scope. And it’s the big businesses that can do the big impact and they can do that because they need lots of money and they have to make lots of money to do that and it’s not seen as something that a social enterprise can do. You sort of think of that large size as something like startups and tech startups and things like this. You know, why can’t a social enterprise be like a tech startup as well? With very different values and, and ambitions.

[00:20:04] David: Exactly.

[00:20:04] Danny: And, and more positive impacts, hopefully.

[00:20:08] David: Well, and a very different approach. That’s, that’s always been the tension we’ve seen for ourselves. This idea of being a… organization was a relatively sensible, small, medium enterprise, charity sort of thing, and a tech start up. A tension between those two.

[00:20:27] Danny: And it’s sort of using the good and the useful aspects from both those areas. You know, there’s lots of good things about, or let’s say useful things about how startups and big businesses operate, but they often have the wrong incentives behind them, but, you know, the actual methods that they use can be purposed for social impact.

[00:20:48] David (2): And let’s just dig into that because saying they have the wrong incentives behind them… There are some things which we’ve discussed in the past which stick out in my mind. It’s this sort of big businesses where, let’s say there’s been a disaster at one of their plants which has had negative environmental or human consequences, and they’ve wanted to do the right thing and they’ve had to sort of change tack because of the shareholders. There’s been very well documented instances of this. This is not something which is new as a concept. It’s something we’d been aware of for many years and discussing. And it was really that idea that I think global isn’t bad, but if global is always like that, it has negative consequences. We’ve seen both of us going around Africa in particular, in different ways as we had with so many different opportunities the potential benefits that global can bring.

[00:21:45] Danny: Yeah, you know, we’ve seen the kind of disappointing aspects of some projects and charity. If only they had been thinking a little bit more entrepreneurial oriented, they would have been able to sort of scale and have a bigger impact and be more sustainable and not be relying on grants and, and sort of money being given to them. But actually sort of being sustainable on their own, which is what a business has to do.

So, I think it should be an advantage being in the middle, I really believe that, because you should be able to have the social impact and the impact which should be attractive to a lot of people. And with a bit of a business attitude. But not having to, you know, not having to pay shareholders and things like this. You should also be able to compete with them. And maybe the rules aren’t set up quite like that at the moment. But there are a lot of people working to try and change that.

[00:22:40] David: So, let’s just finish by me sort of re summarising that last point, because it’s so deep. This aspect that we don’t mind it being harder for us at this point in time, because what we’re trying to demonstrate is that the mechanisms of the social entrepreneurship can out compete.

[00:22:59] Danny: Yeah.

[00:23:00] David: And that, to me, that’s the essence of why we took on this challenge. It’s not been an easy route so far.

[00:23:08] Danny: That’s certainly right. A good point to finish on.

[00:23:11] David: A nice point to finish on, and I look forward to our next discussion.