By Maria Bennici
Looking for a sweet way to keep the sun out of your eyes while keeping American small businesses afloat? Check out MyClo, a for-profit social enterprise founded by Niranjan Kumar and Devan Anderson, two people brought together by a common love for entrepreneurship and fashion. The company, which focuses entirely on hats, uses an innovative microfinance model in partnership with Kiva Zip in order to provide loans to American entrepreneurs in need, while providing adjustable hats to customers with an ethical and trendy streak. I talked to Niranjan and Devan to delve into their experience and hear their story.
While an economics student at UC Berkeley, Niranjan went to Honduras to work as a microfinance consultant, returning with not only experience but the inspiration to start his own entrepreneurial venture.
“I just really wanted to pursue something that was very different and jump into entrepreneurship,” said Niranjan of his post-graduation plans. After being introduced to Devan by a mutual friend, the two of them instantly hit it off and began to plot what sort of social enterprise they could collaborate on, gradually focusing more on “high quality products that look really good but also make a significant impact in the lives of others.”
“Before we focused on American entrepreneurship and American headwear, we were all over the place. We wanted to create T-shirts, jeans, pants, shorts, sweatpants—we didn’t know really, but we knew we wanted to create an impact model,” said Niranjan of the early planning days.
Niranjan said that he had always been interested in “using fashion as the vehicle to promote microfinance.” Luckily for him, Devan already had experience with fashion, from graduating from fashion school to working as a consultant for various clothing brands. In fact, Devan had already pulled off an entrepreneurship venture of his own, specifically focused on hats, and that guided the two of them to ultimately deciding on MyClo centering around hats. But why hats?
“Hats don’t really have a gender construct to them,” said Devan when describing their decision process. “It’s a versatile piece. If we go with an adjustable hat, we open up the availability to everyone else. We need to start with that crown, with that piece that makes you proud to be who you are.”
Using their own money from savings and previous work, Niranjan and Devan launched MyClo, with the dual purposes of making hats and using the loan structure to build a community for entrepreneurs.
How it works:
With each MyClo purchase, a $10 microloan is generated for an American entrepreneur. These microloans are collected for two weeks, and at the end of the fortnight, Niranjan and Devan aggregate the loans generated by the sales and personally choose the entrepreneur benefiting from the loans through Kiva Zip. Afterwards, the entrepreneur pays MyClo back, and the returned loans make their way into the hands of a new entrepreneur. So far, five entrepreneurs have benefited from MyClo loans, including to a store that suffered a devastating robbery and to a family-style Mexican restaurant. This model is powered through Kiva Zip, a mobile-to-mobile zero interest payment platform that works with American entrepreneurs.
As of yet, no entrepreneur has defaulted on their loan, but MyClo isn’t blind to the possibility. According to Niranjan:
“It’s the reality of the world, right? In entrepreneurship, the odds are really stacked against you. The most you can do is help an individual, create a community, surround them, and support them. We would notify our customers and let them know that the loan defaulted. I wouldn’t necessarily say that’s a failure on the customer’s part, on our part, or the entrepreneur’s part. That’s just the way entrepreneurship works. That’s the reality. So for us, when the money comes back, we were going to give the money out to someone else anyway, so it’s not like we are losing something from it.”
Successes and Outlooks:
Prior to the interview, MyClo had already sold out of the maroon line of hats, but this isn’t the only marker of success to the founders.
“So far, success has been that positive reception from entrepreneurs because at the end of the day, they’re the ones that we really want to help and they’re the ones that matter to us most,” said Devan.
Of course, the road to a successful enterprise hardly runs smooth, from the many iterations that a business model can go through to building an online presence.
“We’re e-commerce only, and as an e-commerce company, your biggest obstacle is going to be how you get your company’s face in front of a customer and how you get a conversion. That’s the biggest problem, for most e-commerce companies–finding that space and creating a customer dialogue early on and online,” said Niranjan, adding that Instagram, Facebook ads, and Mailchimp have been instrumental to their success so far.
Not many social enterprises focusing on microfinance for Americans are currently operating in the United States, which makes MyClo a fascinating company to watch, especially considering their long-term ambitions.
“We’d love to see our dreams of community realized,” said Devan. “We’d love to be really impacting and fulfilling entire loans, multiple loans, for entrepreneurs. So something goes up on Kiva and we can just fulfill it. ‘I need 10 grand for my new oven, I make pizzas.’ ‘Okay cool, here’s your oven.’ That would be”—
“The dream.” Niranjan interjected.
With that kind of entrepreneurial spirit (and enthusiasm for Mexican restaurants and pizza ovens), hats off to Niranjan and Devan! Check out their hats here, and keep an eye out for them at various pop-up events in the Bay Area.