RIGA, Latvia – Sabine Sile was hoping to score a location that would allow her business to operate rent-free. She’s the co-founder of Latvia’s first charity shop Otra Elpa (in Latvian, meaning “second breath”). Worried she didn’t have the aura of a wise person because of her age, she brought along the Canadian ambassador’s wife to a breakfast meeting with a property owner.
“Since during the crisis there were a lot of shop spaces empty, we asked if they had any shop space that we could use for a year or two – hopefully with no rent ha-ha,” she said at the Social Entrepreneurship Forum in Latvia.
Sile is a pragmatic entrepreneur. Before the meeting, she took steps to enlist as many people behind her idea as possible. As a charity shop, she needed to make sure that when the shop launched there would be enough things to sell. Through her many encounters, she was able to obtain the support of the Canadian ambassador’s wife.
After a two-hour meal, the property owner offered to take them to tour a location. Being on the second floor, connected by a gloomy staircase, it didn’t look appealing for a storefront to say the least. But figuring that the property owner offered it for no rent, Sile thought it would be a good way to start.
Otra Elpa was founded in 2009, when Latvia had the highest unemployment levels in the EU at 23 percent while the economy grew at -18 percent.
In the Baltic states where economies persevered back into positive growth since 2009, earning the praise of the IMF chief Christine Lagarde, modesty and determination are common traits among social entrepreneurs. Riinu Lepa, who started the social enterprise Tagurpidi Lavka to introduce fresh food options to Estonians and connect them with small farmers and producers, didn’t know whether her idea would work. But she knew that it was becoming more difficult to buy food without food additives. So she wanted to try the idea.
To source local food, Lepa and other volunteers called their grandmothers asking for food from the garden that they didn’t need. They rented out spots at the flea market to test if people wanted to buy local food, and did the same thing for several weekends. Later they transported food to “pop-up” locations three times a week, and ended up doing this for a whole year.
Tagurpidi Lavka was also founded in 2009. Its name means “upside down shop” to suggest that food is ironically being delivered to farmers from the city instead of the other way around. Before going back to Estonia to start the venture, Lepa was working in a multinational corporation in Prague. She dreamed of a large career after graduating university. But in that environment and newfound lifestyle, the dream of a huge career didn’t seem so appealing after all. Her values had shifted. She began asking herself questions – what do I want to do? Who am I?
Things didn’t always go smoothly. Lepa, although determined, realized that the model wasn’t working well. It relied upon a lot of voluntary work – most of the original team grew tired from the labour – and pays just enough to get the next batch of produce to sell. So Tagurpidi Lavka pivoted and started selling online.
When they found out that NGOs in Estonia are not supposed to have more than 50 percent of their activities as business, they were startled. On top of that, there were huge regulations for food in the EU that they should have been following, but in practice it was too much to handle. It proved difficult for Lepa to be a lawyer, bookkeeper, and entrepreneur at the same time. As a result, she established the Estonian Social Enterprise Network to take care of the advocacy of social enterprises, deal with legislation, and make it easier for social enterprises to operate in Estonia.
Today, with four employees, Tagurpidi Lavka is still a humble operation. But they’ve managed to become self-sustainable while providing Estonians an opportunity to choose fresh food.
In contrast, Sile’s idea for a charity shop came as the number of donors for Partners in Ideas Fund, the charitable foundation operating Otra Elpa, was visibly shrinking at the time of the economic collapse. Otra Elpa provided a way to generate regular income for the foundation’s programs. Each month, they invest 800 lats (US $1,500) in social causes, including a venture philanthropy fund that supports social enterprises in Latvia.
For other social entrepreneurs, the motivations for starting up are close to heart. Zane Bojare co-founded Latvian designer rug company Lude this year. The inspiration came from her mother, as she wondered how those like her mother would manage after retirement, or how seniors without children would take care of themselves. Pensions in the Baltic states are low. “One of my parent’s income is 250 euros,” said Bojare.
It’s also a heartbreaking experience to see what happens when you’re not needed in the work environment anymore, says Bojare. There is the loss of one’s social circle, lack of motivation to get out of bed, and loss of reason to live.
“A lot of seniors or retired people are healthy enough to continue working, but might not be able to do it within their existing workplace,” she said.
Lude employs seniors to create stylish rugs, providing them with a reason to get up in the morning. For some it has become a place to gather. A 90-year-old woman once told Bojare that she could sit at home and talk to her cats, but prefers to be at Lude.
Paavo Ala from Estonia also addresses a common problem affecting the elderly. A growing number of seniors live alone. If they run into an accident, no one is there to take care of them. Other times they are unable to call for help themselves. Ala started Meditech Estonia to provide an emergency button wristband that can communicate with a device inside the house to call Meditech for help on the push of a button. If the person is unconscious, the wristband can detect immobility and send a warning to Meditech. Depending on the situation, Meditech will send over a relative, neighbour, welfare worker, or emergency worker.
Ala’s motivation for starting Meditech is to help people feel safe in their own homes, including eventually himself. “By the time I will be that old, I’m going to need an alarm button. I really want the service to be there,” said Ala.
Meditech is also useful for people with disabilities, added Ala. Homes are the places where most accidents occur and where most people die.
No matter what type of social enterprise, one important thing that applies across the board is to understand that ideas are cheap. “Ideas [are] nice, but I think 90 percent is execution,” said Bojare, who is hopeful of the future of social entrepreneurship in the Baltic states.
“What I’m actually very, very happy to see is that we are approached by other people who are starting to see senior workforce as a good workforce, and I’m sure there will be popping up some new social enterprises in Riga, who knows maybe in the Baltics very soon.”