Investing in Vietnam:
The Beginning of Our Journey
Let me tell you about our investment journey in Vietnam with BambooVision, how much money we lost, what we learned from it, and why we are now working on projects worth hundreds of millions of euros with over 60,000 hectares of forest land, all related to bamboo.
In 2018, KKN Beteiligungs GmbH was founded in Berlin with the goal of investing in Vietnam, one of the fastest-growing markets.
Originally, we planned to start an Airbnb business in Hanoi, Vietnam, based on successful European business models.
During our market research, we realized that the Vietnamese market was highly profitable, but our European business model wasn't feasible.
At the same time, the global movement against plastic pollution prompted us to search for alternatives, especially a substitute for plastic straws that could be produced in Vietnam for European consumers.
Bamboo Vietnam as a Promising Resource
Influenced by this movement, we also began searching for alternatives, particularly a substitute for plastic straws that could be produced in Vietnam for European consumers.
This quest led us to discover bamboo. Our founders, Ness and I, embarked on exploring the potential of bamboo straws.
Ness had the idea of using bamboo, and I was immediately falled in love with bamboo.
Ness, our Managing Director and Yoga Master, studied in Australia and was familiar with bamboo from the perspective of yoga philosophy, its strengths, and its spiritual connection.
As someone who grew up in Germany and returned to Vietnam as a "Viet Kieu" after spending 30 years in Berlin, I had little exposure to bamboo other than knowing it as a grass and a food source.
After thorough research on bamboo, we concluded that it is the most cost-effective natural resource for balancing the Earth's climate.
Thus, we decided to invest in a brand for bamboo products under our operational unit "Berlin Love Vietnam."
The Initial Setback of Bamboo Vietnam:
Our first brand was supposed to be "Bebamboo," but we missed the deadline for registering the trademark. A clever lawyer in Germany had already registered the name "Bebamboo" before we could do so.
We learned by the hard way, that making mistakes is part of the learning process, but some mistakes are more painful than others.
With the brand "Bebamboo" not an option anymore, we had to make a tough decision and scrap the entire project. We lost around 50,000 euros that had been invested in development, packaging, and products. After a duration exceeding four months of labor and experiencing substantial financial loss, it became imperative for us to promptly identify an alternative course of action, commonly referred to as a contingency plan or "plan B."
We dedicated a significant amount of time and effort to brainstorming with our respective teams in order to devise an optimal solution and formulate a novel appellation. It was crucial that the name had a dot-com domain, as that holds value as a brand.
Despite initially failing to find a suitable name, we eventually arrived at the idea of BambooVision, which was met with enthusiasm from everyone involved.
The first thing we did was to purchase the domain www.bamboovision.com and register the brand, the trademark.
The first bamboo product of the journey Bamboo Vietnam:
Completing the BambooVision brand took another five weeks, involving video shoots, photoshoots, website development, contracts, investments, and trips to various production sites.
Sourcing in Vietnam is different from the West, as information about factories and farms is not readily available online. We had to actively search, contact numerous people, and make weekly trips.
In some months, we went on up to 12 trips. We covered almost every location in Vietnam where bamboo could be found, meeting regional government representatives, communities, and many individuals. We ate and drank a lot in Vietnam, including drinking alcohol in meetings, which is customary.
Unfortunately, I'm not a fan of alcohol, but it is a significant part of Vietnamese business culture.
The toast "#mottramphantram" means to empty your glass 100%
The Birth of BambooVision:
On December 23, 2019, BambooVision was officially recognized as an international brand.
Our first product was a distinctive set of bamboo straws designed for families, offering three different sizes. We were confident that we had discovered the ideal solution to replace plastic straws.
Unfortunately, our lack of experience and the application of a German mentality, work approach, and high expectations in Vietnam resulted in issues and challenges.
We invested in two factories and ended up losing the money we had put in.
The first factory secretly sold our straws at an inflated price based on our production and stock. As a result, we couldn't meet our production targets and had to pay contractual penalties.
The second partner didn't adhere to the contract, and the production didn't meet our quality standards. We lost the contract and were left with inferior-quality products.
What did we learn from this experience?
The bamboo industry in Vietnam is still in its baby’s shoes. To be successful, we need to develop our own factories and processes, set our own quality standards, and establish systematic production.
We cannot blame our partners entirely. In business, what matters is the law and the contract. If a partner exploits loopholes in the contract to harm you, you cannot blame them. As long as they adhere to the contract, using all existing loopholes, you will lose. The responsibility lies with us.
We were not adequately prepared and failed to adapt to local facts and circumstances.
When entering into a deal, meticulous attention must be given to all important aspects: import/export, contracts, financial flows, taxes, third-party inspections, etc.
What else did we learn?
We lacked the skills to manage a factory in Vietnam with Vietnamese employees.
As investors, our core expertise lies in building a brand.
Our focus should be on developing high-quality services and products related to bamboo.
Initially, our product range mainly consisted of household and kitchen items and everyday essentials. However, over time, we continued to evolve and expand our range of products and services related to bamboo.
BambooVision is a brand oriented toward the future.
We made a conscious decision not to be Chinese copycats or engage in price wars. Our primary objective is to concentrate on the creation of exceptional and pioneering merchandise.
We believe that bamboo is the most cost-effective natural resource available for balancing the Earth's climate.
When the Earth is suffering and lacking oxygen, bamboo should be planted wherever possible. Bamboo has the advantage of having over 1600 different species that can adapt to various temperatures and different land areas, survive, and, most importantly, grow quickly.
Once bamboo is planted everywhere, there should be businesses built around it to sustain its growth. This applies everywhere.
Planting trees alone doesn't make much sense. Following the principle of the Green Circular Economy Model, an industry must also be built around bamboo to allow locals in respective regions to earn money from it. This is the only way to protect forests.
If people don't earn money from bamboo, it will be harvested like any other plant species and replaced with more profitable tree species.
To build an effective business around bamboo, it can only be achieved through innovation. The goal is to develop more and more products and applications related to bamboo, boost consumption, and create a larger market.
Investing in the Future and brands related to bamboo:
In recent years, we have not only built BambooVision but also created other brands for bamboo tea (Bleaf) and many other brands for our partners.
Some examples of wonderfully new products developed from bamboo include:
Bleaf:
A brand that produces environmentally friendly, healthy, and delicious tea from bamboo leaves, Sophora Japonica, and Sweetgrass.
Vanavero:
A sports brand that manufactures shin guards made from bamboo. It offers elegant design and an innovative approach to expanding bamboo products.
Hiddenhelper:
They have also chosen to be environmentally friendly and offer bamboo steps for children in every household in the USA.
The Biggest Bamboo Fraud:
Many of our customers are large international companies that conduct high transfer volumes through international banks, making them targets of criminal schemes. In 2023, one of our biggest customers also fell victim to a massive fraud by scammers.
The criminals somehow gained access to their email account and intercepted email communication between us and our customers. I had not experienced such a horrible situation before, and I sincerely hope we never have to go through it again.
The individual order amounted to a larger five-digit sum, which was fraudulently obtained. The culprits managed to gain access to our customers' email accounts and manipulate the email exchange with us.
The emails from our customers and us were exchanged, and the same thing happened with our emails to our customers. The scammers placed a server in between and swapped our emails with ones using "name@bamboovisiom.com" instead of "name@bamboovision.com."
Since the initial email was already present during an ongoing email conversation and the response email followed, both our team and our customers were already in the middle of the communication. Nobody noticed the email addresses because the recipient fields only contained the recipients' names.
As a result, when we finally sent our customer an invoice, it was the correct one. The invoice was replaced with a new one that had different bank information when it was sent to their accounting team.
The company's accounting department transferred a sizable sum to Turkey, and then the money vanished. Even the responsible bank could do nothing by the time we noticed it four days later.
Always double-check your email senders when it comes to international transfers.
Positive Developments of Bamboo Vietnam:
Nevertheless, we have turned BambooVision into one of the most significant players in the bamboo industry over the years. We have built a massive network of partners and knowledge.
We have optimized new production methods and processes, created many jobs in rural areas, developed numerous innovative products, and today we are capable of creating bamboo items that we could only dream of five years ago.
We have contributed to promoting bamboo globally, and most importantly, we have built one of the most significant brands for Vietnam. Bamboo is a cornerstone of Vietnam, both economically and culturally. The country has so many stories and traditions connected to bamboo, from culinary to religious aspects.
Our next step is to prepare for the development of thousands of hectares of forest land with the Vietnamese government and implement our Green Circular Economy business model. This model focuses on forest development and sustainable management.
We are developing regional businesses around the forest, including carbon offset projects, sustainable forestry, BioChar, etc. We are also planning retreats in which bamboo will play a significant role.
Those interested in investing in sustainable bamboo forest land can connect with us and be a part of shaping a green, clean, and sustainable future for all of us.