Introducing Wenfeng Wei: An Innovative and Dedicated Chinese Social Entrepreneur
Unlike counterparts in Western countries, social businesses in China are still in their infancy. The distinction between non-profits/social philanthropies and social businesses has been introduced to the public only in recent years. The China Social Enterprise and Impact Investing Forum (CSEIF) created in September 2014 has been actively uniting all the social entrepreneurs in China and organizing events to promote their growth. I was particularly interested in one of them — Wenfeng Wei, the founder of Daddy Lab.
Before founding Daddy Lab, Wei was the General Manager of a private firm (which provides assessment services on the safety and toxicological risk of chemicals) and managed more than 150 employees. Prior to that, he had worked in the Entry-exit Inspection and Quarantine Bureau as an expert in product testing and certification for more than 10 years. He held a degree in Physics from Zhejiang University, a top Chinese university in the STEM field. His academic and professional experiences laid a solid foundation for his creation of Daddy Lab.
Back in 2015, right before the new school semester began, Wei bought some plastic stationery for his daughter. At first sniff, he was alerted by his expertise that the stationery might be toxic. He immediately sent some pieces to a lab for testing and was astonished to find that they contained a large amount of toxic and cancerogenic substances. It suddenly came to him that he had been so ignorant about the safety of the products used by his daughter. He had tried every means to report the results to the local authorities but received no response, so he decided to make a documentary of the testing process of some stationery for children of multiple brands available on the market at the national testing center. It costed him more than 100K RMB (13K euros) to do so, but in return, his documentary attracted more than 15 million views and received the support of official media including People’s Daily. What he had done for his daughter led netizens to call him “Daddy Wei” and motivated thousands of parents to join his fight. As more and more people became Wei’s allies, higher-level authorities stepped in and engaged themselves in the improvement of product standards. Just several months later, before the next new semester, the authorities performed a thorough examination of the stationery on the market and set stricter safety standards for future products.
The triumph over this war placed public trust in Wei. He surely was not the first one to stand up and fight against outdated safety standards and non-compliant producers but was probably one of the most famous and professional. More and more parents approached him to seek opinion on the safety of a certain product. They regard Wei as the patron saint of the safety and health of their children. Specimens of pot, rice, water bottle, chopsticks, plastic runway, etc. from across the country continued to arrive and Wei spared no efforts to get them tested. Contradicting his huge success in upgrading the standards, however, is his drained pocket and body. He counted all on himself to carry on the testing procedures and fund all the related activities. Before he started Daddy Lab, he had contributed more than 800K RMB (100K euros) to this fight. He even quitted his well-paying job to be fully devoted to his enterprise.
Although it’s very simple to describe what Wei was doing — sending the specimens he received to authorized labs and interpreting the testing results with a conclusion on whether the product is safe enough — the process in real life was extremely time-, energy- and money-consuming. Apparently, without an efficient operation model and stable sources of revenues, the enterprise which aims to ensure that what Chinese kids eat and use are assuringly safe simply couldn’t sustain itself. This was how Daddy Lab came into being.
Daddy Lab is an innovative creation that takes advantage of the booming e-commerce ecosystem as well as online content-sharing platforms / social media in China. Its online store on Youzan, an e-commerce platform, sells products that meet high safety standards. What differs it from a profit-making business is the fact that it doesn’t charge any premiums for the quality certification. The selling price of each product only comprises the cost of production, packaging, and manual order processing. All other expenses are offset by crowdfunding among parents, which strengthens the philanthropic characteristic of this enterprise. As these fundraisers are at the same time consumers themselves, they are mutually benefiting each other in a way similar to insurance, the efficiency of which has been proved in the business world.
The project has evolved to target a larger audience than pure parents. Wei now wishes to give third-party accreditation that can be fully trusted to any product that is widely used by Chinese consumers. With a productive team, the products that have been tested and accredited are increasing at a rapid speed.
Daddy Lab now operates four lines of products/services — content creation, e-commerce, interior decoration safety checking, and quality spot check. It has a presence on almost all the major social media in China (WeChat, Douyin, Weibo, Xiaohongshu, Zhihu, Bilibili, etc.) with a total of more than 30M followers. Wei’s team frequently publishes informative short videos and articles to educate people about the potential safety and health risks that are usually ignored in daily life. Its e-commerce carefully selects quality products after strict testing and resells them to ordinary consumers (as detailed above). The interior decoration safety checking services actually started with a formaldehyde measurement equipment sharing program. For a normal family who only needs the equipment for several tests, buying a costly brand-new one is not worth it. Most will choose to skip the testing step, yet the harm can be severe. Wei, therefore, took the initiative to buy a new one and let it be passed on to those who need it. The equipment kind of drifts around the country. Now the service line has expanded to include various tests of interior air quality and decoration material safety. The last service (i.e., quality spot check) strives to evaluate a product based on the whole lifecycle of its production including the choice of raw materials, manufacturing techniques, and end quality assurance. It directly answers the concerns of every consumer using rigorous scientific approaches.
Wei’s huge success in establishing Daddy Lab as an influential, trustworthy and self-sustainable social enterprise was not by chance. First of all, he is trying to solve a problem that deeply concerns every Chinese yet is hard and costly to tackle. As the world’s factory, China’s capacity in manufacturing things is incredibly high and is still growing. New products keep emerging and are produced in large quantities, which makes it extremely hard for ordinary consumers to tell good from the bad. Even words-of-mouth sometimes can’t really help because there are many false comments. This increasing production capacity also exerts a huge burden on the authorities as regulations and production standards are constantly challenged by new concepts and techniques and become outdated. Moreover, many products are now sold solely on e-commerce platforms, making it even harder for the authorities to supervise and perform spot checks. Daddy Lab unites forces from the general public to share the expenses (through crowdfunding) and eventually lowers the cost for everyone. Secondly, thanks to its location in Hangzhou, China’s e-commerce center, Daddy Lab takes good advantage of the highly developed e-commerce ecosystem and logistics network there to generate stable revenues from selling accredited products. Its online shop does not only ensure sufficient financial resources for the continuous operations of Daddy Lab but also creates a reliable and convenient channel for consumers to buy trustworthy products. This forms a growing flywheel as more buyers bring more revenues to upgrade operations and get more products tested, which in return offers lower prices and a wider product range that attract more buyers. Thirdly, innovative business models from the tech industry introduced new sources of revenues that are not hard-earned but rewarded. As aforementioned, Daddy Lab is a KOL on major content-sharing platforms with a great many followers. Its original content can be rewarded with a share of the advertising revenues earned by the platforms. Some platforms also offer motivational rewards to encourage content creation in order to retain their users. As a good result, Daddy Lab only needs to focus on creating high-quality content that can attract a large audience and the money will naturally come in. Such business models empower social enterprises like Daddy Lab to stay focused on what they specialize in without worrying much about how to get the necessary financial resources to survive and thrive. Lastly, Daddy Lab was established not to challenge the authorities but to compensate for their inertia, actively engaging itself with open discussions and collaboration with the authorities. This positioning helps it gain governmental trust and support to a large extent, which is critical to its success under the Chinese context.
What remains unclear, however, is how Daddy Lab is going to continuously scale-up. Wei is the key figure in all the original videos that Daddy Lab films as his physical presence is the source of public trust. Even though he can trust the testing procedures to his team, he needs to be somewhat involved in basically all the activities. He and his team probably need to figure out a way to extend public trust from his name to the brand he created before he gets burned out.