'I truly believe, that most people are good. But it is our challenge as entrepreneurs to reveal and foster it, in order to solve the most urgent problems of our time.'
A rapidly growing number of brands, retailers and consumers are becoming aware of the social challenges in the supply chain and looking for ways to improve the conditions for the workers involved in the production of their products.
We are thrilled to share with you the story of impact entrepreneur, Jonathan Funke. His passion for social causes fueled his ambition to build a company driving change in the industry.
Tip-Me connects consumers with those that make their clothes while providing fashion retail brands with a way to enhance transparency and accountability in their supply chains.
Tell us about yourself, your past, present and your future ambitions? What is sustainability to you, and how are you driving change through your organization?
I was a real sustainability nerd pretty much for my entire life. While most teenagers were going to parties, I was sitting in my room researching and writing literally hundreds of blog posts on how to lower your carbon footprint and how a sustainable and fair economy could look like.
At the age of 17, I started to delve deeper into sustainable fashion. At a demonstration against the fast-fashion company Primark, I learned that only 3% of the price we pay for a t-shirt actually goes to the people that made it. I made it my life’s mission to change that. In a cafe, we all tip the waiter. Imagine you could tip the coffee farmer, too. With a 3% tip, we could double the wages of most workers around the globe. Tip me is an organization that connects consumers and workers directly. We believe that we can reshape the way fashion is consumed by showing the customer who made their product. We believe we can make globalization fairer by redistributing wealth one tip at a time.
About Tip-Me. What does your platform do and what was the main driver for you to launch this platform?
Tip me enables you to tip the people that made your product. The next time you buy ethical jeans, shoes or t-shirts in our partner shops, you can give a tip to the person that made the item. In the online shop, you can see a short profile of the worker and their personal wish. Tip me ensures that your tip is sent directly, safely and without deduction, to the individual workers. Tip me cuts out the middlemen. We have an international payment system that sends the tips directly to the bank account or mobile phone of the individual workers. We have also developed a verification software that cross-checks the data for maximum security.
What kind of companies do you collaborate with? Are there requirements for them to join? Do you support them to make a positive impact?
We, at tip me, do NOT tolerate greenwashing. That is why we only work with ethical brands and factories that fulfill the standards of the UN International Labour Organization (ILO). In order to work with tip me, partner brands need to prove responsibility and transparency along their supply chain. We only work with brands that are fair, sustainable, and respect the criteria of the ILO. This allows us to ensure that our partner companies also contribute their share to making fair and sustainable supply chains the norm. We are always looking for more brands to join us on our journey.
Many brands claim to be investing in sustainability and communicate to be on 'their way' to becoming socially and/or environmentally sustainable, but today they are doing very little. What would you like to tell them?
I would tell them to watch out. Things have changed in the last years. Be it driven by the climate protests or the black lives matter movement, people are tired of the same old promises that they have heard for decades. Our generation does not have time to wait for promises to be kept. We have less than a decade to minimize the impact of climate change. And our generation feels this threat. We will be your future customers, your future business partners, and future employees. And we will not forget what you did or did not do.
About workers & protecting their rights
Tip me offers a way for consumers to support workers in the fashion supply chain, enabled by companies that have adopted the tip me tool.
Many of the current brands that work with you are already investing in better working conditions for their employees. How do you ensure that the companies who use tip me use fair practices in their supply chains?
We only work with brands that ensure fair working conditions in their factories. In practice, we have several checks in place to make sure that workers are treated with respect. First of all, factories that want to join tip me have to provide certification by trusted third parties such as the Fair Wear Foundation, that Human Rights are upheld. In particular, we need to be sure that workers have the right to form unions, that there is no child labor and the workers are paid decent wages. We have already turned down several factories that did not meet our standards. Because tips can never replace human rights.
Additionally, we are in direct contact with the workers. We have a big WhatsApp group with the workers from Pakistan for example. We keep them updated about when to expect the next tips and they can report any dubious behavior. So far we only received cute GIFs or questions on the next tip transfer. But it is an additional layer of safety we provide.
How do the tips reach the employees?
All the tips are collected in a digital pool. We then split the tips fairly among the team members in the factory. Each worker receives his or her amount on their personal bank account. If bank accounts are not available, we also provide SMS-based payments. So there are no middlemen between tip me and the individual workers. Through this direct connection, we can ensure that a tip goes directly - safely and without deductions - to the workers.
We are also working on a new system enabling brands to pay living wages directly. Currently, if brands pay 1 USD more in order to raise wages, only 0.15 USD makes it to workers, because every middleman takes his piece of the pie. We want to change that. With our system, we can ensure that the money goes directly from the brand to the personal accouns of the workers.
About your Impact - What are the results of brands that are already collaborating with tip-me? Can you share some insights for us to understand the impact of your tool?
There are four important ways tip me has an impact;
- The most obvious one: workers have more money to spend. Through our first surveys, we found that the additional income is invested primarily in food and education of children. But others will also use it to fix their motorcycle or start their own business. That’s the beauty of tip me: the workers are empowered to determine their own future.
- A more subtle effect is that workers feel respected. For the first time, they get direct feedback from literally the other end of the world, some thanking them for their everyday work. I think we all need that sometimes.
- Consumer love tipping. Every second customer tips in our partner shop. The average tip is around 4 USD. For context: 3.5 billion people on earth live on 5.50 USD a day.
- We have found that consumers value the transparency and human connection our partner brands offer. If they know the workers, they are more likely to buy from these ethical brands again. That’s exactly the kind of impact we want to have: reshaping the way we consume by showing you who made your product.
Your insights and vision towards a fairer supply chain- Based on your experience and market insights as impact entrepreneur, do you see change happening in the industry? How do you expect the fashion retail supply chain will develop going forward?
I believe that impact always moves in two waves: innovation and consolidation. Currently, we are in the innovation phase: many brands, both big and small, are starting to experiment with new garments, product cycles, supply chain transparency and fairness solutions such as tip me. And that is exactly the way it should be. We are facing new consumer demands, new ecological and social challenges, and also have new tools to solve them. But within the next 5 years, we need to come to the phase of consolidation so that these solutions become the new normal. And this can only be done through industry-wide standards and political action. The pioneer brands just don’t have the leverage to change the way a factory is run or the mass consumers behave. But they can show us what is possible. And that’s also where I see tip me - as a catalyst for change.
Tell us about your journey towards where you are today. What are the learnings you would like to share with other social impact entrepreneurs in fashion retail?
Go to the factories. (I mean, not now obviously. But really do, after covid.) Talking to workers, listening, and understanding them is the best fuel and motivation you can get to make change happen. Plus you can make sure you’re solving a real problem.
About Tip Me
Tip Me offers solutions for fair products. They aim to enhance transparency and accountability in supply chains and support consumers in making informed and sustainable decisions, by leveraging digital technologies of our time.
Meet & Connect with Jonathan Funke
We warmly welcome you to meet and connect with Jonathan Funke. In his live-webinar he will take you on his journey as impact entrepreneur, the challenges faced and vision for the future of fashion retail. The webinar is followed by a 10-minute Q&A. Register on the event page.