G Adventures provides low-interest loans to its employees to start tourism-related businesses that provide a win-win for everyone.
June 29, 2018 8 min read
Ruben Diaz had the life. As a tour guide and CEO—chief experience officer—for international tourism company G Adventures from 2008 to 2016, he proudly showed people from all over the world what his home country of Peru had to offer. There were the trips down the Amazon river, hikes to the stunning Machu Picchu, walks along the Inca Trail, tours to the Sacred Valley and swims in Lake Titicaca, one of the highest lakes in the world.
“I loved my job,” he tells Entrepreneur.com.
Image credit: Best Bites Peru
But this sort of lifestyle can take a toll. Being a CEO required him to constantly be “on,” answering inquisitives tourists’ questions, plodding through rugged terrain, all in the name of the customer experience.
It also required Diaz to be away from his family, friends and local community for long stretches of time. It wasn’t uncommon to do back-to-back trips, each being 21 days long. His wife had a hard time adjusting to his schedule, and his kids even needed to see psychologists to help them cope with his frequent absence.
Burnout eventually hit—hard.
In 2015, after seven years on the road with the company, Diaz’s customer evaluation scores started to slip, going from regular 10s to 7s and 8s. His name was no longer among those nominated for awards, and he wasn’t where he needed to be in terms of G Adventures’ values.
His boss took notice.
“Ruben was on that trajectory out,” says Bruce Poon Tip, the CEO (chief executive officer) and founder of G Adventures. “He was one of our superstars and then he just disappeared into the abyss. His scores aren’t great, so he doesn’t get recognized, and is then on the path to being bitter.”
Founder and CEO of G Adventures Bruce Poon Tip
But neither wanted to cut ties. For Diaz, this was his livelihood, a well-paying job that kept him in demand. Indeed, international tourism in Peru rose by 7.7 percent in 2016, according to the World Tourism and Travel Council. (The global average is 3.9 percent.) The country had 3.8 million tourists in 2017, with this number expected to nearly double to 6.5 million by 2027, according to a recent report.
For Poon Tip, the company invests a lot in its chief experience officers. “We spent so much time training these people; they knew everything about our brand, everything about our customers, I didn’t want to lose all that training,” he says. “We have a very aggressive brand promise and there are no better people to deliver that brand promise than the people that are on the ground every day, who know our customers better than I do.”
But Poon Tip had seen this happen with his best guides before–and he already had built a solution.
G Adventures had just launched the G Values Fund in 2015, a venture arm that allows CEOs who are at the tail end of their careers to continue working with the company in a different capacity: as entrepreneurs. Through G Values fund, CEOs are able to apply for a low-interest loan to start a tourism-related business that provides value and branded experiences for G Adventures customers.
“Within all our thousands of trips we run all over the world, there are thousands of little suppliers that supply us services,” Poon Tip says. “So why don’t we offer microloans to our CEOs to start their own businesses? They are understand our customers, are completely evangelists of our brand and they deliver a much better, branded service.”
For Diaz, he had always dreamed of opening up a hospitality business – and this afforded him the opportunity. He applied to the G Values fund, was accepted, and in year 2016 launched Best Bites Peru, a culinary tour company. The business takes tourists—from G Adventures and other travel companies alike—to local markets. There, they taste some of the country’s unique fruits—including the granadilla, pitahaya and chirimoya — and learn about Peruvian gastronomy. Once back to Best Bites Peru’s “Guest House,” clients enjoy a cooking class where they make making pisco sours, ceviche and a chicken dish called causa a la limena.
Best Bites Peru Founder Ruben Diaz
“It is very fulfilling,” says Diaz. “I am into service; I like talking to tourists and people.”
It’s not only a win for Diaz, but also G Adventures.
“He loves the brand, the company, and there is no better ambassador for us than someone like Ruben,” says Poon Tip, adding, “He talks about the years on the road, the G Values Fund, and the customers love it.”
There are currently two other companies that received a loan from the G Values Fund: the Hanoi Food Culture in Vietnam and The Street Kitchen in India, both of which provide employment opportunities to young adults who have been the victims of homelessness, human trafficking and abuse.
Hanoi Food Culture in Vietnam
While the G Values Fund is open to every CEO (there are currently from 70 countries), not every business gets accepted for a loan. For it to fit into the G Adventures business model, the entrepreneur must supply a service that complements the brand, meaning it must be an experience the company’s tourists can enjoy, while also building awareness and making money.
“This is not a charity; it is not like a Kiva microloan,” says Poon Tip, referring to the global non-profit lending platform. “This is a business and has to be approved on the basis of creating a better experience for our customers while honoring our brand promise.”
The aspiring entrepreneur must go through a lengthy and comprehensive process to get the funds, including getting the initial idea approved, writing a business plan (in English), working with a mentor to refine the plan and pitching it to the G Adventure’s board of advisors. On average, the process can take up to a year, and if accepted, the newly minted entrepreneurs are put on a payment plan for the loan, which hovers around 5 percent interest.
Interns at The Street Kitchen in India
When Diaz found out he was accepted, he was ecstatic. “It was the most beautiful time I have had, after getting married and having kids,” he says. “It was like, I did it!”
He was granted a $5,000 loan that he used for website design, a phone and additional expenses; he also put some of the funds aside to cover family expenses while he was getting Best Bites Peru started.
As more companies are launching through the G Values Fund – two additional businesses are on track to launch soon — more CEOs are feeling comfortable applying, a challenge Poon Tip faced early on.
“Even though our employees trust us with their jobs, it doesn’t mean they are going to trust us to quit their jobs, start a business and take a risk,” he says. “They have to go through periods of not getting a salary, they have families to support,” he says.
To date, there have been nearly 25 applications submitted to the G Value Fund, with the company seeing applications doubling from 2016 to 2017. Later this year, the Poon Tip says he will roll out the G Values Fund to other G Adventures employees, and is working with the advisory board to determine the minimum criteria needed to apply. Currently, the available funds from Poon Tip’s book sales will help launch 10 new businesses, but the CEO envisions the G Values Fund being long term, telling us, “It won’t end.” He will support other endeavors with the gains received from businesses already operating under the fund, including interest made off loans, while promising to invest G Adventures profits back to the fund, if needed.
“There are no good ideas that don’t get funded,” he says. “We want everything to happen.”
Source Link:- https://www.entrepreneur.com/article/315928