While shopping, send a tip to the people who sewed your clothes – the young social enterprise “Tip Me” from Cologne makes it possible with their innovative software solution and thus improves the lives of many sewers.

The topic of transparency in supply chains has recently experienced a significant upswing. More and more customers want to know under which conditions their products are manufactured. In addition to the increased demand on the consumer side, more and more ethical fashion brands are voluntarily publishing the coordinates of their factories and relying on certificates. By 2023, companies in Germany with more than 3,000 employees will also be legally required by the new Supply Chain Act to disclose their supply chain transparently. The main purpose of this is to ensure that fundamental human rights are protected and, in particular, that the ban on child labor is enforced. After all, millions of people around the world are still working under exploitative conditions in textile factories due to a lack of minimum social standards and environmental regulations on-site.

A tip for the seamstresses of your clothes

How about supporting these people already today by giving them a tip when shopping online, similar to what you know from going to a restaurant? With their innovative software solution, the young social enterprise “Tip Me” makes it possible. With just one click, customers can donate a tip to the makers of their clothes in participating partner stores. The tips are collected, fairly divided among the seamstresses, and transferred to the individual accounts of the people. This is not a way to express appreciation, but to actively improve the lives of the seamstresses. For example, the life of Thi Be Ty Ngyen from Vietnam.

 

 

At the age of 16, he moved from the country to the city to work in the textile industry. His job is to sew the waistband on the jeans pants of “Dawn Denim”, which is again the most complicated part of sewing. Thanks to the cooperation with Tip Me, Thi receives about 86,- Euro per year in addition to his income. With this money, he wants to support his sick mother and dreams of building her a house in the countryside.

A 13th month’s salary through tips

For Fozia Bibi from Pakistan, a single parent, and deaf woman, Tip Me has also made a big difference. She sees the tips as recognition for her good work and uses the money to buy clothes for her three children. She is one of the few female workers in Pakistan who mainly glues soles to shoes during her working hours. Like Fozia, Muhammad Boota also works in the shoe production of “Ethletic”. Tip Me earns him a 13th month’s salary, which he uses to pay his four children pocket money and give them small gifts.

Whether in Pakistan or Vietnam, all Tip Me creators have a personal profile where customers can find out more about the individual stories. Tip Me is in direct contact with them via WhatsApp & Co. and transfers 100 percent of the tips to their respective bank or cell phone account. So the startup doesn’t take any commission from the tips. Rather, Tip Me makes its money by having participating partner stores like “Ethletic” and “Dawn Denim” pay a monthly usage fee and commission for using the software solution. The idea is well received: nearly half of all customers who shop at participating stores also tip the seamstresses.

How you can participate financially in Tip Me

Tip Me is a social business that reinvests future financial surpluses in its own company and thus uses them for its social purpose. It thus differs from traditional companies that distribute profits to their founders or investors. Nevertheless, there is currently the possibility to participate in Tip Me. The company has launched a crowdinvesting campaign and would like to involve the community in providing the necessary growth capital.

 

Tip Me works with the Viennese crowdfunding platform Conda, which also has a branch in Germany. The platform fills an important gap in the market, as it offers forms of financing that are particularly attractive for young social enterprises that do not want to transfer company shares (equity) to external investors, as this could lead to a conflict of objectives between increasing returns or impact and thus possibly dilute the social purpose of the enterprise. The participation takes place via a subordinated loan and is still possible until the end of September. This even with very small amounts starting from 100, – euro.

From our point of view, this is a great possibility to support a real purpose enterprise. Because an investment in a social enterprise has, if it develops successfully, enormous leverage. The positive effect continues even after the investment has been repaid. That’s why we at GOOD like to support projects through social investment when possible. 

As with any investment in a young company that has yet to establish itself on the market, the following also applies to Tip Me: It is by no means certain that the money will flow back or even that the quite high-interest rate of 7 percent will be earned. However, for those who would otherwise have donated the money or who have money they don’t absolutely need and are careful not to put all their eggs in one basket, this is a strong option to increase impact.