Seb Bishop: (RED)

The international CEO of (RED) on building an iconic brand, the power of enterprise and why he has “the best job in the world”


Seb Bishop, entrepreneur and international chief executive of (RED), tells Growing Business about building an iconic brand, the power of enterprise and why balancing the demands of business with a social conscience makes his role “the best job in the world”

“If (RED) were a charity, I probably wouldn’t have taken the job,” says Seb Bishop. The international CEO of the iconic social impact brand is almost a senior statesman among the burgeoning generation of entrepreneurs wanting to put something back, on their terms. For him, like many social entrepreneurs, the power of (RED) to bring about social change lies within its status as a commercial business. It’s not about asking for donations, it’s a sustainable business model where everybody wins, he says. (RED) was founded in 2006 by U2 frontman Bono and attorney, activist and nephew of John F Kennedy, Bobby Shriver, to raise money for the fight against HIV and AIDS in Africa through the Global Fund. The organisation ties up with brand heavyweights such as Apple, Armani, Converse, Dell, Starbucks, Gap and more recently, Nike, to release exclusive special editions of their products bearing the (RED) brand, with up to 50% of the profits generated going directly to the Global Fund. So far, this model has raised just under $150m for the cause. Meanwhile, partners pay (RED) a licence fee in return for the use of its brand, which is used to fund the organisation’s operating costs. The idea was to create a brand so powerful that not only would businesses want to be associated with it, but by placing it on products, consumers would be more likely to buy them. “And that’s exactly what we’ve done,” insists Bishop, who admits that he finds it mildly frustrating when the media insists upon referring to (RED) as “Bono’s charity”. Social business The Global Fund was established in 2002 by former UN secretary general Kofi Annan, who wanted to create a global war chest to try and eradicate HIV, Tuberculosis and Malaria. “It’s an incredible organisation,” says Bishop. However, while the Global Fund did a phenomenal job of engaging with the public sector in the fight against these three killer diseases, with grants totalling $18.7bn at work around the world, it struggled to win over the private sector, which is where (RED) comes in. “The beauty of the idea that Bobby and Bono had is that in order to engage with the private sector, you need to be a business yourself,” says Bishop. “You must present a business case.”   Although some charities were initially uncomfortable with the fact that partners also profit from the arrangement, for Bishop this is an absolute must. “It’s very important that they can make some money from this, because if they don’t, it’s unsustainable,” he argues. “The beauty of (RED) is that the partners, the Global Fund and consumers all benefit.” Bishop has previously described (RED) as the place where “desire meets virtue”; people don’t buy (RED) products out of pity. It’s this duality that makes it a compelling  model for consumers eager to give something back but sometimes uncomfortable with being accosted by people with clipboards on the street. “We’re not asking people to donate,” he explains. “We’re not saying give us £5. We’re saying go about your business. Do as you would normally. But if you’re going to buy a computer tomorrow, or an MP3 player, or a cup of coffee, choose one that has the (RED) brand on it. Why? Because up to 50% of the profit from the sale of that individual item will go directly to the Global Fund to help people with HIV in sub-Saharan Africa.”

Man on a mission

Given Bishop’s CV, it’s not hard to see why the (RED) board took him on. Bishop created ad campaigns for some of the world’s leading brands before co-founding and then selling pay-per-click advertising pioneer Espotting for $186m. At just 31, the deal saw him become one of the youngest ever presidents of a NASDAQ-quoted company. As well as running (RED), he’s the chairman of award-winning digital marketing agency Steak, the company co-founded by Bishop’s brother Ollie, and a non-executive director of both Future Publishing and AdJug, the online advertising exchange co-founded by former Espotting team member Satish Jayakumar. Now 36, earlier this year Bishop was named a Young Global Leader by the World Economic Forum. And that’s not all. Along with an indisputable knack for problem solving he has on-the-ground experience of building businesses in Uganda. In 2007, he was asked to star in a Channel 4 TV show, The Mission. He wasn’t interested in becoming a reality TV star, nor was he too thrilled when the producers changed the name at the last minute to Millionaires’ Mission, but the concept fascinated him. The show’s premise was to take eight successful entrepreneurs to a village in Uganda, to see if they could use their business acumen and overcome the lack of financial infrastructure to generate sustainable sources of income in the region. Each ‘millionaire’ contributed £15,000 to get the projects up and running. “A lot of what I learned while building Espotting came in very useful for being on the ground in Uganda, particularly never taking no for an answer,” he says. “You’ve got to keep pushing and adapt to the situation.”   His aptitude for logic soon became apparent. Bishop’s ideas – a farmers’ co-operative to take the local population from subsistence to commercial farming, plus a hotel for Western guests to visit and teach local children English – were the ones implemented. The Teach Inn hotel is still going today, and when I first met Bishop in early 2008 he had already returned to see how it was getting on. Although he is in no way dismissive of the role charity work plays in the developing world, the experience opened Bishop’s eyes to the vital role business can play, too. An enduring passion for social entrepreneurship was born. “Enterprise is a very powerful force for change,” he says. “When you look at Muhammad Yunus and the impact that micro-financing has had on the ground, it’s clear that business can improve the lives of the people that need it.”   Following his TV appearance, Bishop received a phone call from his friend Danny Rimer, of VC firm Index Ventures, who recommended him to fellow VC Juliet Flint, a partner at Kleiner Perkins Caufield & Byers (an early backer of Google) and (RED) board member. As international chief executive, Bishop’s mandates are to raise as much money for the Global Fund as possible while increasing awareness of the cause, supporting (RED)’s partners and engaging with new ones. Bishop’s entrepreneurial background really comes into its own when speaking to potential partners about (RED). “Having run and started several businesses myself allows me to talk about it from a business perspective, not just from a marketing angle,” he says. While he acknowledges the inevitable PR boost its famous co-founders gives the (RED) brand, he is keen to stress that it isn’t merely a vehicle for celebrities to pay lip service to a good cause in order to raise their profile. “(RED) isn’t just a fluffy marketing ploy,” he insists. “It’s about helping the performance of businesses at the core level.” According to Bishop, partners gain a plethora of benefits from striking up an alliance with (RED), and he draws on his own entrepreneurial experience to explain to CEOs how the partnership will help their organisation at a core level. Brand differentiation and awareness, association to a cause, an increase in sales, customer loyalty, and, interestingly, increased employee engagement and a higher calibre of job applicants are just some of the benefits that (RED) partners can expect. Then there’s the chance to engage with more than a million (RED) Twitter followers and the search engine optimisation benefits of being linked to the other partners on the web. Naturally, the possibility of having their products endorsed by brand ambassadors such as Scarlett Johansson, Penelope Cruz and Christy Turlington doesn’t do them any harm, either.

 
Striking a balance

If (RED)’s story charts the rise of the social entrepreneur and the disruption of the traditional charity model, it also demonstrates that it’s not just entrepreneurs who are looking for new ways of putting something back. Bishop cites recent research which found that 87% of consumers are more likely to buy a cause-related product than one that’s not. “Consumers are changing,” he says. “Generation X is gone. Generation Y is looking for products and services that give back.” While Bishop won’t disclose how much partners pay to licence the (RED) brand (it depends on the partner, the category, the geographical location, he protests) it’s clear that what they get in return is a lot more than a logo to slap on their products. Partners pay (RED) a licence fee, he says, because “when they do so, their sales go up.” For this reason, perhaps unsurprisingly, there is no shortage of brands wanting the (RED) treatment. “I actually spend a lot of time turning away brands that want to go (RED),” reveals Bishop. Isn’t that counter-intuitive, given that the more (RED) products sold, the more money is raised for the Global Fund? Not so, he says. “People often ask me: ‘Why don’t you turn more things (RED)?” The answer is simply that he can’t risk brand dilution. An explosion of (RED) products on the market could jeopardise the brand’s current sought-after appeal. Around 146,000 people in Sub-Saharan Africa currently receive two ARV pills a day because of the money raised by the sale of (RED) products. The provision of this life-saving medication needs to be ongoing. “These people need to have their two pills a day, every day, for life,” says Bishop. “This has to be sustainable.” It’s no good flooding the market with products and raising a huge lump of cash if this leads to over-saturation and future funding drying up. “Our product is our brand,” stresses Bishop. After spending the morning with him, and being shown various videos and graphics to ensure my thorough understanding of the model, it’s abundantly clear that the (RED) brand is something he’s both incredibly passionate about, and fiercely protective of. Understandably, with stakes this high, (RED) is highly selective about its partners. Brands have to be “iconic” leaders in their field, with products or services that are already sought after by consumers. As CEO, maintaining this balance between raising as much money as possible and building an iconic (and enduring) brand falls squarely at his door. But he’s always on the look-out for new tie-ups with the right partners. For example, a recent partnership saw the launch of FLOWE(RED). Unveiled by TV presenter Cat Deeley in Covent Garden and operated in collaboration with Flamingo Flowers, the online service selling ethically sourced arrangements (through an e-commerce site built by Steak) has proved a major hit, smashing initial sales targets. The BT Tower, London Eye and Premier League have all gone (RED); Twitter, Google and Facebook went (RED) to mark World AIDS Day, while across the pond, (RED) Nights has generated revenue from gigs by artists such as Katy Perry. Through these partnerships, Bishop says (RED) has helped the Global Fund to support more than five million people in Ghana, Lesotho, Rwanda, South Africa, Swaziland and Zambia since its launch. In Rwanda, for instance, there are 225,000 HIV+ people, of which 75,000 need ARVs. (RED) provides drugs for a third of them. In Africa, one of the biggest challenges is preventing the transmission of HIV (which is carried in breast milk) from mother to child. Since its launch, (RED), through the Global Fund, has provided preventative treatment to more than 88,000 mums. Bishop, himself a father of a four-year-old and an 18-month-old, says meeting children who are HIV free because of the work (RED) has done is one of the most incredible, and fulfilling, aspects of his role. “To have a job where I still get to run a business, but actually impact on people’s lives as opposed to just looking at the bottom line of the spreadsheet, is the best job in the world.”

Search for success

There were signs of Seb Bishop’s entrepreneurialism even before his Espotting days. He left school at 18 and, following a six-month course at the School of Communication Arts (where he is now a governor), the budding film director hoped to follow in the footsteps of Robin Hood’s Ridley Scott. Landing an internship at advertising agency Publicis and eager to make an impact, he and colleague James Burrows, “smuggled a brief off another creative’s desk”. It paid off, with the pair subsequently flying to Moscow to launch Coca Cola in Russia at the age of 20. A role as art director at Rainey Kelly Campbell Roalfe followed, which Bishop left to set up Espotting with school friend Daniel Ishag in 2000. The pay-per-click model, where advertisers bid on keywords to show up in search results, was originally devised by US-firm GoTo (which became Overture), Espotting’s main competitor. “We effectively introduced pay-per-click advertising in Europe,” says Bishop. Google didn’t release its own AdWords tool until 2002. However, this didn’t stop pretty much every venture capital firm in town, bar one (Proven, now Beringea) turning down the opportunity to invest following the dotcom crash. Espotting was sold to US player FindWhat.com in 2003, in a deal worth $186m. By this point, the company had close to 300 employees, was powering Yahoo, Lycos, Ask Jeeves and AltaVista, and had offices all over Europe. Bishop became president of the company, which rebranded as MIVA. He continued with entrepreneurial pursuits, investing in several businesses, including AdJug, which enables website owners to sell space directly to advertisers; and Steak, which now has offices in London, Melbourne and New York, and clients such as Virgin Holidays and John Lewis.

In his own words

On (RED) co-founder, Bono

“Bono’s very active in the business. He recently turned the U2 tour (RED), with part of the ticket sales going directly to the Global Fund. He’s an incredible marketer and a very smart man”

On preserving your founding culture

“I only tend to hire people I’m willing to have lunch with. I ask my direct reports to use the same mantra, then, the chances are that, as the family grows, we’ll all be able to hang out together”

On running a NASDAQ-listed company

“I found myself spending more time dealing with the complexities of running a publicly listed company in the US than actually running the business. You go from quarter to quarter and you end up taking your eye off the core of the business. I admire those who can do both incredibly well, because that was not where my strengths lie”

On what he looks for as an investor

“I tend to invest in the entrepreneur and not necessarily the idea. I’ve met a number of entrepreneurs with good business models, but when you challenge them about it, they’re so convinced their idea is the best that they don’t think it should ever change. That puts me off. I look for those that are willing to change with the market, of which there are very few, believe it or not”

On Millionaires’ Mission

“After the way that running my own business empowered me, and the confidence and drive it gave me, when I was presented with the idea of making that happen again on the ground in Uganda, I jumped at the chance. That’s what I thought was really interesting, to see whether you could help people feel the same way” On the most fulfilling part of his role “To go to Africa and meet mothers whose children are born HIV negative because of the work that all of us do collectively is incredible. Meeting those children that now have a normal life, and won’t be on ARVs for the rest of their life…there’s nothing like it”

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