‘Better before bigger’: How Thankyou is changing the social enterprise game

In the 14 years since Thankyou started, it’s grown, changed shape, learnt some big lessons and even come close to shutting its doors. Now, it’s looking towards a new challenge; disrupting the way we give, writes Maggie Coggan in this month’s Spotlight on social enterprise. 

While there were many moments that led to Thankyou becoming the business it is today, for the company’s co-founder, Daniel Flynn, it was the realisation that his life could have very easily been different had he not been born in Australia. 

“At the age of 19, I was at university and interested in getting into business and property development,” Flynn tells Pro Bono News. 

“But I remember just watching all these videos of kids who don’t have access to clean water. And while I already knew that was happening around the world, it was the individual stories that were really compelling. 

“I had that moment of what if that was me?”

Flipping a $50 billion industry on its head 

With around 800 million people unable to access clean drinking water, having an industry that made $50 billion profit selling bottled water didn’t sit right with Flynn and his co-founder (then girlfriend, now wife) Justine Flynn. 

“It was really just sitting down and saying, ‘well what if there was a brand that builds a bridge between the $63 trillion we spend as consumers every year and the nearly 800 million people who don’t have access to clean drinking water and are living in poverty’?” he said. 

Thankyou started off selling water to help fund water projects, but the intention was never to keep it at just one product. 

Today, the company produces 55 products including food, soap, hand sanitiser and nappies.

All profits are directed to a charity trust run by Thankyou. The money is then distributed to charity partners. 

Flynn said that it has always been Thankyou’s role to fund development, not do it themselves. 

“The complexity in the development space is incredible. There’s also a lot of people already doing great work, so it was always our mission just to raise the money for the work already happening,” he said. 

Since 2008, the company has raised $17 million for their impact partners. 

But over the years, the way the business has distributed this funding has changed shape dramatically. 

“Previously, our view was that we would fund water and food projects, because that’s a really beautiful consumer story,” Flynn said. 

“But actually, solving global poverty is complex and it needs a myriad of solutions.”

In its latest round of funding, Thankyou will spread money across 18 grassroots organisations working across everything from water, sanitation and hygiene, to maternal and mental health. 

As well as changing the projects funded, the brand has also undergone changes to the products they are stocking as well. 

Playing the big game 

While Thankyou struggled at first to get into the mainstream market, the rising interest in social enterprise among consumers meant it didn’t stay that way for long. 

In 2013, thousands of people successfully petitioned Coles and Woolworths to stock Thankyou products on their shelves, making its food and water widely accessible to Australians across the country. 

But entering the mainstream market didn’t come without challenges. 

In 2017, Thankyou launched its own nappies and secured 10 per cent of the market share, which from an industry perspective was unheard of. 

“Nappies is a category where it’s really hard to move a consumer, but we managed to hit a level in the market that certainly sent a message to everyone that Thankyou had a lot of potential,” Flynn said. 

“But when major brands started to realise that maybe we were actually a bit of a threat, they immediately discounted their stock. It turned into a price war that nearly killed Thankyou.”

Flynn said it was this near-death experience that actually forced the company to rethink everything it was doing from the way it was giving, to the way it was operating. 

In 2020, the company announced it would stop selling its flagship bottled water in an attempt to reduce its environmental footprint. 

Flynn told Pro Bono News in 2020 that while bottled water was its “genesis product”, the purpose of Thankyou was never about selling water but rather harnessing collective consumer power to take action on extreme poverty.

“Water was the first product to introduce Thankyou as a concept, but we feel like it served its purpose and probably lived a little past its use-by date,” Flynn said.

“We are looking to make the biggest positive impact we can on the world and single-use bottled water is the environmental enemy number one in the consumer space. It’s something that we really shouldn’t be buying.” 

Disrupting giving 

As part of this rethink, Thankyou is on a mission to disrupt and shift the way the public and philanthropists give to charities. 

Flynn said that one of the biggest obstacles facing the charity sector was the time spent pleasing and pandering to donors, rather than focusing on innovation and outcomes.  

“The level of transformation and growth that’s coming out of the not-for-profit sector is really archaic compared to the for-profit sector,” he said. 

He said that Thankyou’s giving system had been built by “donor dysfunction”, driven by a desire from donors to support projects that they can tangibly see and understand.

One example of this was giving Thankyou Water consumers tracker codes to see the GPS coordinates of the projects they funded.

But Flynn said the social enterprise now realises that this has led to organisations treating the symptoms, but not the root causes of systemic issues – resulting in temporary fixes and broken solutions.

“If you booked heart surgery and you got a surgeon, you wouldn’t be telling them how to do that job and how you want it done just because you paid them,” Flynn said. 

Thankyou’s new approach is called trust-based philanthropy, which involves funders taking a step back and not controlling every detail of a project. Since the shift to an unrestricted model of giving in 2020, Thankyou has given $8 million to 16 partners worldwide.

He said that now the enterprise was letting its charity partners control the process, it could work to encourage others to follow a similar path. 

“I know that we are not alone in this, there are others already in this space, and there are others championing this idea of unrestricted funding, but we think it’s just so important to share our experience,” he said. 

A work in progress 

As the social enterprise looks ahead, there’s no shortage of projects in the pipeline. 

In 2020, it sent a partnership invitation to 11 of the biggest product companies (and some of their biggest competitors), including Proctor and Gamble, Unilever and Pangea, in a bid to flip consumerism for good. 

Flynn explained that while they knew Thankyou could not compete directly with these companies, if they offered companies the exclusive rights to manufacture and distribute Thankyou products, then it would be a win-win for both parties. 

“It would result in positive commercial outcomes for both parties and ultimately help us reach our mission quicker,” Flynn said.  

“And what’s interesting about most businesses and industries is there are some that aren’t doing any good, but there’s a bunch that want to do more good. They’re kind of stuck, and I guess that’s where we come in.” 

While the initial campaign attracted a lot of attention, Flynn said at this point there were no partnership announcements to make. 

“I think we’re 75 weeks into our five week campaign, but we are dedicated to taking the time to find the right partnership and not rushing this. 

“I know that we will find the right partner though, and the day we do will be a great day.” 

He added that for now, Thankyou’s growth was guided by a single phrase; better before bigger. 

“It can really be applied across everything we do… from giving, to the products we are putting out there, it has to be better before it gets bigger,” he said.