Dinesh Thirupuvanam is founder of the Viv Biz Club, a green buyer’s club that offers deep discounts for green businesses on certain green cleaning supplies, office supplies, and packaging.
Green Marketing TV interviewed Dinesh to get his tips on saving money without sacrificing sustainability, and how to make it as a green start-up.
Let’s get started by asking you to explain a little about what the Viv Biz Club is and how it works.
Sure thing. The Viv Biz Club is an eco buying group that helps small businesses pool their purchasing power in order to access deep discounts on eco-friendly supplies. Our members get access to two major discounts with suppliers today: World Centric offer’s Viv businesses 20% off their catalog of compostable food packaging (e.g., compostable cups, plates) and Office Depot offers Viv businesses 15-80% off their greenest office & janitorial supplies.
What types of screening do you do to ensure that products are really green?
Well, more broadly we look at things like: sustainable characteristics of the product, manufacturer’s commitment to sustainability, certifications, materials sourcing, etc.
The specifics, though, really depend on the product. With compostable food packaging, for instance, it’s essential that businesses purchase products certified according to one of the major international standards for compostability (ASTM D6400, ASTM D6868, or EN13432). We’ve also chosen to work with the manufacturer in the space that we believe has the deepest environmental commitments (e.g., World Centric is carbon neutral, donates 25% of their proceeds to grassroots environmental organizations, sells some products at cost to K-12 schools… the list goes on).
What product types do you feel need the most green innovation, either because the existing green options are not good quality or because there aren’t currently any green options at all?
So this is a slight twist on your question, but as opposed to citing a specific product category, I’d say that the entire composting business is ripe for innovation and growth. The US only composts 3% of its food waste and there are only a handful or municipalities that offer curbside composting to citizens and businesses.
Some start-ups are already moving into this space and offering innovative composting alternatives to consumers and businesses, but there’s a huge opportunity here to drive our country toward zero waste. Major innovation (and likely regulation) is needed to give most of our country access to simple & easy composting services, but luckily that means there’s a whole lot of opportunity here for green entrepreneurs!
B2B services such as the Viv Biz Club are still comparatively rare in the green business world. What gave you the idea to start a green buying club for businesses and how did you get started?
Well, we actually started out as a green loyalty program under the name “Do You Viv?” – we were working with about 80 businesses in the San Francisco / Bay Area and we noticed that one of the biggest problems for our eco-minded business owners was finding affordable eco-friendly supplies. Cases of compostable containers or recycled paper were just too expensive for most of the small businesses we were working with, and they couldn’t get access to large, volume-based discounts because they weren’t putting in orders that were large enough. We knew about GPOs in the healthcare space and Groupon was just getting popular, so we decided to evolve our program to focus on helping our businesses overcome this problem through cooperative purchasing.
What has been your biggest obstacle as a green entrepreneur and do you feel you’ve overcome it successfully?
We’ve had to overcome a lot of obstacles (as I said, we changed our whole business model around!), but I’d say one of the biggest we’ve dealt with has been driving engagement with our program.
Earlier this spring we were enabling businesses to join the Viv Biz Club for free. We thought this would be great as it would remove a friction point in our sign-up process and we’d see more businesses joining the Viv Biz Club. From a revenue standpoint we weren’t too concerned about missing out on the membership fee revenue because we make most of our money through small commissions we earn on the purchases Viv businesses make with our suppliers.
At first, we thought the free move was working great. The number of businesses joining Viv each week jumped 5-10x and we were very excited! Then, a month a two later, we were looking at our numbers and saw that only a few of these businesses were making purchases with our suppliers. We were investing time & money getting them signed up and set up, but they weren’t invested in the Viv Biz Club.
We had to learn the hard way that the quality of customers you bring on is just as important (if not more important) than the quantity. We moved Viv over to a $50 one-time membership fee and made our sales materials much more robust, showing how most businesses should break even on that fee in just a matter of days, and now almost all of our new businesses are putting in purchases. We’re not seeing quite as many signups, but we are seeing much better financial results for Viv.
What marketing strategies have you found to be most effective for reaching out to your fellow green entrepreneurs?
I’ve found that just being personal, showing genuine interest, and adding value (even in a very small way) to someone’s businesses can be a first great step.
One of the simple things I’ve done to engage with other green online entrepreneurs is to simply comment on their blogs and interact with their websites. This adds value to their site and for me has resulted in some great exchanges with folks. In some cases, I’ve then followed up via email and we’ve started collaborating in other ways (e.g., I now guest write for a handful of green blogs).
Your business model is based on helping other green businesses save money without sacrificing sustainability. As a small green business owner yourself, what other tips do you have for saving money while going green?
For small green business owners, I think most of it comes down to reduce and reuse. These days most offices are run on a laptop and an internet connection. Little things like turning off your computer at night, keeping a tray for scrap paper that has one side printed, but another side blank, or even just eliminating paper towels and replacing them with cloth dish towels (or even old t-shirts) can all make a big difference. In many cases, we’ve found that for startups or small offices, the “standard” office purchases can actually be avoided with a bit of creative thinking and reuse.
What advice do you have for wanna-be green entrepreneurs?
I’d say two things:
1) For green entrepreneurs specifically – make sure you’re building transparency into the core of your businesses from day one. There’s a lot of greenwashing out there (and a lot of backlash against it), and one of the simplest ways to avoid being labeled a greenwasher is just to be very open about your businesses from the get go. (quick tip – a simple way to start is just to have a company blog).
2) For entrepreneurs in general – go out and get feedback from potential customers as soon as humanly possible. Even if your product or service isn’t complete, take the 50% version (even the 20% version), and do some mock sales. See what folks like, what they don’t, how much they are willing to pay, etc, etc. The quickest way to learn is by doing and the sooner you start selling the quicker you’re going to realize what works, what doesn’t, and how to really make it.