S O U K E L T A Y E B : D E F Y I N G T H E L I N E S B E T W E E N

B U S I N E S S A N D N O N - P R O F I T

Rabeh Ghadban and Nathalie Laidler-Kylander, 2011

Souk el Tayeb’s initiatives are different expressions of one family. We are neither a non-

profit nor a business enterprise…We create incubators to nurture ideas that follow our

overall mission…We have one vision, with different models to achieve it. We seek to

break this system that defines the lines between business and NGOs.1

Kamal Mouzawak, Founder of Souk el Tayeb

By March 2011, Kamal Mouzawak, the founder of Souk el Tayeb (SET),2and his business

partner Christine Codsi had created a social venture that provided locally grown produce from

small farmers directly to consumers. Activities to achieve this included a weekly farmers market

and a restaurant in Beirut, Lebanon. Faced with opportunities to create additional for-profit

venture, Mouzawak and Codsi wanted to ensure that their next steps would be aligned with their

original mission to preserve local culinary traditions, increase market opportunities for small

farmers and sustain a socially responsible brand. Mouzawak and Codsi wondered if the hybrid

model that they had established would continue to work or whether they could have more impact

by being entirely profit driven or exclusively nonprofit?

Small Farmers and Preserving Lebanese Traditions: Socio-Economic Context

Lebanon had a long tradition of farming and rural agriculture. Part of the Fertile Crescent,

Lebanon‟s agriculture sector made up 11.7% of its annual GDP in 2010.3 The Bekaa Valley,

located in eastern Lebanon, had traditionally been one of the largest exporters of crops and

produce in the region. Dense agricultural lands were also found in the south and some northern

parts of northern Lebanon as well. Estimates of Lebanon‟s cultivable land were around 35%, but

1 Interview, Kamal Mouzawak &Codsi Codsi: August 7, 2010 2 English translation: “The tasty market”

3 "Background Note: Lebanon". U.S. Department of State. March 2010

2

it was believed that only 60% of this potential was used in 2010.4 Small farmers made up the

majority of agricultural workers, estimated at over 50%.5

In Lebanon in 2011, unemployment remained high and almost 30% of the country was below

the poverty line.6 Confidence in the economy was less than 20% and 70% of Lebanese believed

their country was heading in the wrong direction. The lack of opportunities for economic

prosperity was concentrated in rural communities away from the urban centers. The bleak

economic reality was even tougher on small farmers. With the development of the agricultural

industry through new advanced technological practices and the increase in competition across the

region, many small Lebanese farmers had lost significant portions of their business. Unable to

find the capital to modernize, what had for previous generations been the main source of family

income, had become a national pastime. As a result, new generations of farmland owners opted

out of traditional practices in favor for more mainstream professional careers, moving to urban

communities and leaving behind their inherited land for little more than weekend visits.

The Culinary Revivalist Movement

Home to eighteen confessional divisions, Lebanon was a country of deep social cleavages.

Having endured a fifteen-year civil war from 1975-1990, a war with Israel in 2006, and a

weeklong-armed conflict in 2008, it was no surprise that economic growth remained intimately

connected to political stability. Political divisions were often strictly defined along religions and

geographic lines. Indeed, political differences were palpable, leading one prominent Lebanese

politician to assert that, "Lebanon is not a nation. It's a bunch of tribes."7

Preserving Culinary Lebanese Traditions

If there was one common bond, however, that all Lebanese shared, it was their food. Scattered

around the world in Australia, Africa, Latin America and across North America, Lebanon‟s

Diaspora community was estimated to comprise 14 million people, over three times the 4 million

Lebanese actually living within the country.8 With the Diaspora came the proliferation of

Lebanese food and culinary traditions, connecting Lebanese abroad and promoting the country‟s

culture to a global audience.

Inside Lebanon, traditional culinary practices also served as a binding force that transcended

confessional lines. Food preservation had even become a serious issue for the Lebanese

government as well, as it prepared to file lawsuits against Israeli in international courts over

trademarks on hummus, tabouleh and falafel as Lebanese dishes.9 This sparked a “culinary war”

4 ESCWA, “Evaluation of agricultural policies in selected ESCWA member countries: A case study in Lebanon,”

United Nations, 1999 5 “National Agricultural Policy Report: Lebanon.” Agricultural Research Institute. October 2005

6 “Palestine, Israel and Lebanon: Politics and Peace Prospects.” International Peace Institute with Charney Research.

December 2010. 7 A resurgent Syria, alarms Israel and the US. Washington Post. Dec. 4, 2010 (http://www.washingtonpost.com/wp-

dyn/content/article/2010/12/03/AR2010120306852_2.html) 8 UK Foreign & Commonwealth Office, “Lebanon Country Profile” (http://www.fco.gov.uk/en/travel-and-living-

abroad/travel-advice-by-country/country-profile/middle-east-north-africa/lebanon) 9 Lebanon to sue Israel for marketing hummus as its own. The Guardian. Oct. 7, 2008

(http://www.guardian.co.uk/world/2008/oct/07/israelandthepalestinians.lebanon)

3

between Israel and Lebanon through a contest to create the world‟s largest hummus dish.10

After

Israel initially took the Guinness World Records for the largest hummus dish ever made,

Lebanon “reclaimed national pride” by gathering 300 local chefs from various religious

communities, to construct a 22,000 lb. dish of hummus in May 2010.

This unifying cultural heritage had also been commercialized within Lebanon. Local

entrepreneurs, primarily in Beirut, who often defined themselves outside the religious

sectarianism equation and as part of the broader Lebanese fabric, began to open various cafés,

bars and grocery stores that were emblematic of a culinary revivalist movement. This included

cafés like Al Falamanki, which served traditional Lebanese dishes and was designed as a

traditional Lebanese village in the heart of Beirut. Widely popular, Al Falamunki proved that a

concept based on culinary heritage could be successful, with annual sales of $4 million and over

$1 million in profits in 2010. Having announced plans to franchise this concept, Al Falamanki

planned to open additional stores in different regions within Lebanon over the next five years.11

Small Farmers and the Organic Sector Analysis

A critical part of the culinary revivalist movement was the growth of the organic industry in

Lebanon. Organic agriculture had primarily gained traction among middle to upper income

Beirut residents who became increasing willing to buy produce from local farmers at a higher

price point. Initiated in the late 1990s, the movement grew in reaction to the uncontrolled over-

application of synthetic chemicals in Lebanon.

After decades of intensive use of agro-chemicals as a means to increase yields and

improve their living, an increasing number of farmers have become concerned about

issues of health and environment. In fact, a lot of farmers used to practice organic

agriculture by default. Poor farmers couldn‟t afford the high cost of agriculture inputs

and they relied on the available resources such as manure and organic residues. Yet, those

farmers were driven by economic necessity to shift to what is now called conventional

agriculture, leaving behind the traditional practices.12

The Association for Lebanese Organic Agriculture (ALOA) estimated that there were over 300

organically certified farmers in Lebanon in 2009.13

With assistance from NGOs and universities,

this number was expected to grow as the organic market was projected to gain traction among a

broader group of consumers in Beirut.

Organic Produce & Packaged Goods

The local organic produce market in Lebanon included: apples, bananas, grapes, apricots,

peaches, cherries, citrus fruits, potatoes, tomatoes, onions and garlic. In addition, packaged

organic products were increasingly being added, including: honey, tomato paste, wine, kishik

10

Lebanon escalates hummus war with Israel. The Telegraph. May 9, 2010

(http://www.telegraph.co.uk/foodanddrink/foodanddrinknews/7701856/Lebanon-escalate-hummus-war-with-

Israel.html) 11

Al Falamunki: Traditional Lebanese Café – Franchise Information (http://www.alfalamanki.com/) 12

Touma, Rania. “Going Organic in Lebanon.” Cahiers Options Méditerranéenn, 2008 13

ALOA Newsletter, “Organic Agriculture in Lebanon” ALOA, 2009

4

(oatmeal), arak (local alcohol), mraba (jam), labneh (dried yogurt), rose water, wine, olive oil

and a variety of local spices, most prominently, zaatar (oregano).

Barriers Into Domestic Organic Market

Significant barriers to entry impeded small farmers from capitalizing on the growth the organic

industry. Most small farmers, for example, were unable to compete as they were not organically

certified and did not meet requirements to export their products. Indeed, sophisticated medium-

sized farmers with a long family history working in organic trade or large corporations, already

exported and sold products via established distribution channels. Small farmers, then, were

forced to compete in local markets at a cost that matches their more advanced, much more cost

effective competitors. This left small farmers having to sell their products at a lower price, as

consumers outside Beirut often lacked the willingness to pay a higher price point for local

produced products.

The lack of government support in the development of organic agriculture was also an obstacle

for small farmers.14

Organic agriculture was not a priority for the Lebanese Ministry of

Agriculture, due to budgetary constraints and a lack of awareness. Finally, the high costs of

increasing capacity for small farmers to acquire and learn new technologies, coupled by limited

financing options provided by local banks for entrepreneurs, represented a significant barrier to

gaining the capital needed for investing in organic agriculture.

Sector and Distribution Changes

NGOs such as ALOA and Biocoop Lubnan, as well as, universities like the American University

of Beirut through the Faculty of Agricultural and Food Sciences (FAFS), who sponsored The

Healthy Basket, a local organic market in Beirut, had worked to level the playing field for small

farmers and increase their market access. Together, they had helped promote organic products in

Lebanon through public advocacy campaigns, while also enhancing the capacity of small farmers

to achieve organic certification.

To cater to this growing industry, organic markets had sprung up in Beirut, led by The Healthy

Basket, and A New Earth. The leading supermarket chain in Lebanon, TSC, also followed suit,

creating an organic section and a “buy local” produce section to cater to its customer‟s increasing

demands. By creating its own brand of organic products in late 2009, TSC had raised the

visibility of the organic movement, and also significantly altered the competitive landscape as it

was the first highly capitalized entity to enter the organic market. In addition, restaurants such as

Bread Republic and Al Falamunki had also begun to use cause marketing to inform customers

that their produce was from local farmers.

Origins of SET

An eccentric man, Mouzawak was filled with ideas and brimmed with positivism. A free spirit of

sorts, Mouzawak only gradually developed his passion for culinary heritage. It was his love for

Lebanon that came first, unaware early in his professional career that this passionate fervor

would soon lead to a successful social venture.

14

Touma, Rania. “Going Organic in Lebanon.” Cahiers Options Méditerranéenn, 2008

5

A native of Jeita, a small city about 20 minutes north of Beirut, Mouzawak began as graphic

designer and journalist, bumping from one job to another, before stumbling on an opportunity to

write a guidebook on Lebanon in 1993. Getting the opportunity to travel his native land,

Mouzawak developed a strong affinity for its people and learned to appreciate new parts of his

country that he had never been to before, soaking in the contrasting landscape and disparate

peoples. Through this experience, Mouzawak gained candid exposure to Lebanon‟s often

conflicting cultures between Christianity and Islam, and was overwhelmed by the local

hospitality he was greeted with, regardless of where he went.

For the next 10 years, Mouzawak continued to write but also worked as a chef and television

host for a cooking show that was aired in Lebanon and other parts of the Middle East. His

interest in food began to peek when he took part in a nationally televised cooking show known as

“Sohtak bil Sahenn” or “Your Health in Your Plate.1” In addition, when Mouzawak moved to

his new house in Batourn, he used his garden to host a cooking school. At the Kitchen

Workshop, Mouzawak “ran frequent workshops, largely on the foods of the Eastern

Mediterranean, taught schoolchildren about regional ingredients and dishes, and organized

programs that brought farmers to schools, and pupils to farms or apiaries.”

It was not until 2003, however, at a Garden Show, a yearly festival organized at the hippodrome

of Beirut, which celebrated the environment and traditional culinary practices, that the idea for

SET emerged. At this event, Mouzawak was asked to organize something around farmers and

agriculture, which he called “The Garden‟s Fruit.” His booth was tremendously successful and

attendees asked Mouzawak to make this more than just a yearly event. Inspired by the positive

feedback, Mouzawak founded SET in 2004, creating Lebanon‟s first farmers market.

Registered as a non-profit in Lebanon, SET sought to “contribute to local community initiatives,

implement advocacy through education about food traditions, and create a platform to bring

together people of different regions, origins and beliefs around a shared goal.15

” From this

mission, a number of development programs evolved, as well as two separate commercial

projects.

SET Development Programs

As the son of a farmer, Mouzawak leveraged his previous experience as a food and travel writer,

teacher of macrobiotic cooking and chef of a budding television series broadcasted in the Middle

East, to implement development programs that could offer a platform for small farmers to sell

their produce at a fair price.

Farmers Market

From a small booth at the Garden Show, SET evolved into weekly farmer market that held over

70 farmers in downtown Beirut in 2010 (Exhibit 1 shows a birds-eye picture of SET‟s farmers

market). This was SET‟s core activity, as it connected both consumers who valued traditional,

naturally grown products, with farmers and producers, for a fair price on their goods. The goal

was to allow small farmers to gain recognition while also increasing access and income

generation. Indeed, of the 70 farmers showcased at SET, on average twenty other farmers from

15

Souk el Tayeb Website: http://soukeltayeb.com/

6

the same village were employed in some capacity.16

This meant that in total, over 1,400 farmers

were directly impacted as a result of SET‟s weekly farmer‟s market.

Food and Feast

In addition, SET developed programs beyond the farmers market to increase the scale of social

impact. This included a two-year project, originally funded by USAID and then taken on by

UNDP, called Food and Feast in 2007. These festivals included SET farmers, but primarily

sought to feature local food culture and culinary traditions of each region.17

Six festivals were

held in 2007 and fourteen more in villages across Lebanon were put together in 2008 (Exhibit 2

shows promotional material used to advertise Food and Feast from five different sites). This

project worked toward providing a forum for urban and rural interaction, breaking down the

traditional segregation between these communities through the commonality of food.

Educational Program

Programs to raise the capacity of small farmers and build awareness around the importance of

incorporating natural products into one‟s diet, had been another important component of SET‟s

activities since 2004. This included a project called Tatweer,18

which sought to build, reinforce

and improve farmers‟ capacity in agricultural and food processing techniques and business

development. Subjects included guidance on sales, administration, financial management and

brand identity.19

Another educational program implemented by SET was the Farmers Exchange project.

Leveraging bilateral exchange programs in London, Galway, Amsterdam and New York,

Lebanese farmers were given the opportunity to share their work experience with fellow farmers

and producers from different countries. This initiative put farmers though workshops that

prepared them to be effective participants in SET‟s farmers market.

Finally, Souk @ Schools was a yearlong project that SET managed in partnership with

elementary schools in Beirut to increase awareness amongst school children, of the importance

of a healthy diet. This was accomplished by putting together a small version of the farmers

market on two school campuses and introducing students and their parents to SET‟s producers.

SET further built on this program by incorporating “Kid‟s Corner” at the regular farmers market,

which hosted educational games and activities for students of all ages.20

Network of Small Farmers

Advocating for organic agriculture and conscientious consumption practices since 2004, SET

gained first mover advantage against competitors like Healthy Basket, A New Earth and TSC.

An article in Time Out Magazine reinforced the notion that SET was at the forefront of the

budding organic industry, asserting that it had become “the local gold standard for all things

16

Interview, Kamal Mouzawak & Christine Codsi: August 7, 2010 17

Souk el Tayeb Website: http://soukeltayeb.com 18

Arabic for “professional development” 19 Souk el Tayeb Website: http://soukeltayeb.com 20 Souk el Tayeb Website: http://soukeltayeb.com

7

organic, delicious and original.”21

Indeed, SET was the first initiative to recognize the potential of

small farmers. As Mouzawak explained:

Nobody in Lebanon up until then had paid any attention to small farmers who were

basically left to fend for themselves, trying to survive without any governmental

assistance; usually forced to leave their villages and either immigrate, or move to the big

city and abandon their land.22

Through these development programs, not only did SET develop brand awareness, but it also

created a network of small farmers. SET‟s early market entry, and the strong profits that farmers

made from selling their products through SET, resulted in a loyal base of producers that were

satisfied with the structure of their partnership with SET. Recognizing that not all farmers can

take part in the farmer‟s market, SET used development projects to expand access to different

farmers. While this extended additional opportunities to small farmers, it also increased the

number of suppliers for their commercial projects.

Funding

Development projects like Food and Feast, and educational programs like Farmers Exchange,

Tatweer and Souk @ School operated on a traditional donor-patron model. SET had previously

received grants from USAID, UNDP and the Ministry of Tourism, which were used to fund

independent projects. SET continued to take on independent projects funded by external donors

when the management felt it aligned with its core mission, but with the model of budgetary

balance that offsets their costs, SET did not depend on donor funds for financial stability. SET

charged $25 per farmer at the farmer market, which resulted in $85,102 in revenue in 2009

(Exhibit 3 shows the income statement for SET development programs). These fees offset the

majority of the costs incurred for renting, licensing, labor and raw materials needed to manage

the farmers market.

SET Commercial Projects

In order to sustain and expand SET‟s development programs, Mouzawak began to think about

opportunities to commercialize his non-profit through new for-profit ventures. He recognized

that he needed help to achieve this and recruited Codsi to join him as his business partner and co-

manager of SET‟s two commercial projects.

With no professional training in business, Mouzawak was introduced to Codsi through a mutual

friend. Codsi had heard about SET, and became a regular at the farmers market. Fed up with her

corporate job, where she had spent the last six years in strategic management consultancy, Codsi

joined Mouzawak in 2008 to develop income-generating projects for SET. The two

complemented each other, as Codsi provided business acumen, allowing Mouzawak to focus his

entrepreneurial vision on new potential ventures.

21

“Olive Oil with Souk el Tayeb,” Time Out, January 23, 2009

http://www.timeoutbeirut.com/explorer&ownthiscity/article/4157/olive-oil-with-souk-el-tayeb.html 22

Kamal Mouzawak, food visionary for Lebanon

http://www.tasteofbeirut.com/2010/01/Mouzawak-mouzawak-food-visionaire/

8

While SET‟s development programs had not been isolated to a particular socio-economic class in

Lebanon, broadly encompassing different segments through its various projects, both

commercial projects, Tawlet and Dekanet, attracted high-end, affluent customers from Beirut.

Young professionals and upper-class families in Beirut were their primary target audiences.

Tawlet

Registered as separate legal entity, Tawlet kitchen was SET‟s first for-profit venture. It opened

for business in October 2009 and remained intimately linked to SET‟s core mission and brand, as

the restaurant was created to allow SET‟s producers to share their recipes and local traditions in

Beirut. Indeed, most of the produce and ingredients used at the Tawlet were purchased directly

from SET producers, helping to increase the revenue to small farmers. Tawlet also actively

targeted disenfranchised women who were small farmers or came from rural communities as

their featured daily chefs, offering them an opportunity for social recognition (Exhibit 4 profiles

one of the chefs from Tawlet, Suzane Doueihy). “At Tawlet,” explained Codsi, “people do not

just get their food and leave. It is a full experience. The chefs present their food and give a bit of

background on its history. This process empowers the women who are able to present their skills

and be recognized by the customers. So not only is there an economic benefit, but it provides

social recognition.”23

Mouzawak expanded on how this opportunity for women chefs could become a transformative

experience.

One of the chefs has become the main bread-winner of her household, making more

money than her husband and providing for her family as a result of her participation in

Tawlet. She is a chef at our restaurant and provides private lessons for contacts she has

made at Tawlet and now how been able to buy her family‟s first car.24

For Mouzawak and Codsi, Tawlet was an extension of its development projects, as it was “built

around the idea of coexistence through sharing food and sharing tables.”25

With rotational chefs

that created a constantly changing menu, a kitchen style layout that invited interaction between

the diners and the cook, and an open buffet concept that only served seasonal food to ensure

freshness and taste, Tawlet became a new restaurant concept that utilized SET‟s network of

farmers to create a profitable business venture (Exhibit 5 provides pictures of Tawlet).

At Tawlet, a fixed price of $25 per meal and short hours of operations, had helped SET earn near

$615,000 in sales in 2009-2010.26

After operational expenses were subtracted, SET achieved

$106,500 in profit in its first fourteen months, which was reinvested towards SET development

projects (Exhibit 6 shows the SET commercial project‟s income statement). Initial start-up

capital was low, using only a loan of $20,000 to create an interior design layout that used

recycled furniture to provide “an atmosphere of elegant simplicity.27

” In addition, Tawlet used a

buffet style, all you can eat and drink approach, cutting the cost of hiring any staff besides the

23

Interview, Kamal Mouzawak & Christine Codsi: August 7, 2010 24

Interview, Kamal Mouzawak & Christine Codsi: August 23, 2010 25

Interview, Kamal Mouzawak & Christine Codsi: August 23, 2010 26

Interview, Kamal Mouzawak & Christine Codsi: November 19, 2010 27

“Tawlet „kitchen table:‟ Mom, What‟s for lunch today?” El Tayeb. No. 14. October 2009

9

daily cook, and one full time employee, the kitchen manager. Chefs brought in to cook at Tawlet

were not considered official staff members, but were paid on a daily basis.

Dekenet28

Another venture launched by SET in 2009 was Dekenet, which expanded SET‟s visibility by

selling SET products through a major supermarket chain in Lebanon. Dekenet’s organic

packaged products were sourced from the network of SET small farmers, and were sold through

a partnership with TSC‟s flagship super market in Beirut, a retailer that was on the same scale as

Whole Foods in the US. TSC featured Dekenet in theor stores as part of its organic and locally

produced section at a 5% market up relative to other organic products. Products were labeled

with the SET brand and profiled the small farmer or producer (Exhibit 7 shows Dekanet products

on display). In addition, net profits (after overhead expenses for distribution and packaging

incurred by SET) were directed back to the farmers. Dekenet, however, only played a marginal

role in its financial operations, as SET took 10% off the selling price of products sold at TSC to

offset the cost of packaging and distribution.

Although divided into separate bank accounts that were managed separately, the sum of profits

made from Tawlet, fees derived from the farmers market, and revenues from the Dekenet, funded

SET‟s operational expenses and activities.

The SET Brand

Tawlet and Dekanet were created as a natural evolution of SET‟s development projects. Indeed,

the success of the original non-profit entity was the primary catalyst for the for-profit extensions

that were created. Mouzawak and Codsi were careful to ensure that their commercial projects

were seen as a further embodiment of SET, utilizing synergies between the two and leveraging

the brand equity of their non-profit for its for-profit success.

Promotion

SET employed minimal resources to its promotion strategy. Using only a modest website with a

basic overview of the organization as their main investment on communications, it was their

development projects and weekly farmers market that served as their primary channels of

communication and promotion tools. Additional communication had come as result of great

press coverage from local and international media outlets like the NY Times, The Guardian, Time

Out Magazine, Monocle and various travel magazines (Exhibit 8 displays some of these articles).

This increased both buzz and awarness so much, that Tawlet and Dekenat incurred almost no

costs towards promotional material, relying only on word of mouth.

Product

A rigorous control of farmers and producers selected for SET projects was used to ensure quality

consistent with the organic label. Although SET did not only pick producers who were

organically certified, understanding the obstacles that many small farmers faced in achieving

certification, it did send out its quality control manager on location to each producer‟s farm to

28

Arabic for “small market.”

10

ensure that minimum standards similar to those of organic certification, were being upheld. In

addition, Tawlet only used seasonal ingredients, produced locally and never frozen. This ensured

a high standard of quality that helped justify the relatively high $25 price point at Tawlet.

Mouzawak and Codsi insisted that in order to be competitive with the agro-business model that

could afford to price its produce low because of mass distribution, their venture had to offer a

clear added value in terms of quality. To circumvent the regional competition, SET utilized

Lebanon‟s limited resources. Without access to cheap labor that existed in Turkey, Syria, Israel

and Jordan, SET decided to cater to Lebanese “very sophisticated palette.” Lebanon, and by

extension SET, could therefore compete “using the best quality produce and marketing niche

products.”

Distribution

SET projects connected small farmers directly with consumers. It was the farmers‟ products that

were sold at TSC supermarket through Dekanet, and it was the farmers or local chefs who

directly interacted with customers at Tawlet. By using a distribution strategy absent of

middlemen, SET had created a supply chain that allowed for a more personalized experience by

bringing additional value to both the end consumer and the small farmer. Indeed, SET provided

a venue for rural residents to build relationships with urban dwellers that reinforced the bond of

preserving traditional Lebanese heritage and bolstered the sense of a shared sense of identity.

This interaction became financially rewarding to both SET and the producers, and personally

satisfying for the customer. As Mouzawak explained:

„Souk el Tayeb‟ a product? No. It‟s the souk‟s people and places and faces. But it is

never a Souk product. What we are doing is cutting out the middlemen. We save costs

this way and the money then goes directly to the producer. Simple. The producer only has

to pay a small rent to have the space to sell their produce, but it‟s not a percentage or cut

of their sales. This is how we make the system economically viable.

Cause Marketing - Social Inclusion and Cohesion

Acutely aware of the Lebanon‟s political history, Mouzawak wanted SET to exemplify the

diversity of the Lebanese people, using his venture to transcend sectarian divisions. Mouzawak

saw SET as an extension of Lebanese society:

In Lebanon we have many different religious sects with seemingly nothing in common,

except food. Tradition, after all, is heritage. And there is no such thing as religious

cuisine in Lebanon. Whether Christian or Muslim, we all eat the same foods.29

Through the farmers market and the various educational program, Mouzawak brought together

fractured communities and created links between people through the commonality of Lebanese

food. Rami Zurayk, an Ecosystem Management professor at the American University of Beirut,

applauded Mouzawak‟s work:

29 Interview, Kamal Mouzawak & Christine Codsi: November 19, 2010

11

Lebanon is hopelessly confessional and sectarian. Against this background, the souk

(SET) offers an alternative in which people from all sides of Lebanon - social,

geographic, class, culture, and sect - can meet and not exchange views about the politics,

but just interact in routine activities like buying and selling. Somehow, in the souk, a

truce is declared.30

On the 30th

anniversary of the civil war in 2005, SET gathered their food producers and farmers

in the heart of Beirut, handing out brochures designed like passports. Inside was a map of

Lebanon, with landmarks identified by regional food specialties.31

Even during the July War in

2006 with Israel, Mouzawak refused to close down SET, holding weekly farmer markets as

usual. For Mouzawak, the best form of resistance was to continue on with life as normal, as

anything else would have been “communal suicide.”

Placing social inclusion and cohesion as a priority in SET‟s development programs resulted in

brand loyalty towards its commercial projects from members across sectarian divides. As a

result, SET leveraged political schisms to its advantage, positioning itself as unifying actor in

conflict-laden community.

Organizational Structure and Leadership

Although Mouzawak was the founder of SET, he shared his management responsibilities with

his business partner Codsi. Mouzawak maintained a majority stake in SET commercial projects,

as the ownership breakdown was 60/40 between him and Codsi. The quality Control Officer

ensured new farmers brought into SET were either organically certified or upheld a basic quality

standard (Exhibit 9 shows SET application process). Additionally, there was a kitchen manager

at Tawlet and a manager for the farmers market, responsible with overlooking daily logistics and

collecting participations fees. Finally, SET had on staff a financial manager, in charge of

accounting and office administration.

Mouzawak and Codsi‟s different management styles facilitated a collaborative management

approach. Mouzawak was seen more as the visionary of SET, while Codsi, with many years of

experience as a strategic management consultant, provided discipline and structure to SET and

Tawlet. In addition, Mouzawak and Codsi had shown their personal commitment to SET

through financial sacrifices of their own. In the early part of the venture, Mouzawak was often

left strapped for personal cash, having to default his salary to SET to ensure it would remain

above water. Similarly, when Codsi moved away from her comfortable job as a strategic

consultant, she spent the first six-months without salary at SET, managing to get by on savings

she had tucked away from her previous job.

An Evolving Social Venture

Mouzawak and Codsi seemed to be unconcerned about the legal status or title that SET‟s

different initiatives assumed. Unfettered by whether their organizational structure would grow to

resemble a traditional business ventures or an NGO, all new projects emanated from the goal of

30

“In divided Lebanon, farmers' market a model of unity,” The Daily Star, August17, 2009

(http://www.dailystar.com.lb/article.asp?edition_id=1&categ_id=1&article_id=105366) 31

“A Lebanese chef's vision: Make falafel, not war,” NY Times, August 16, 2007

(http://www.nytimes.com/2007/08/16/world/africa/16iht-souk.4.7144729.html)

12

extending their core mission. Indeed, Mouzawak and Codsi refused to be confined to traditional

discourse and contemporary definition of a “social enterprise,” or defined as “social

entrepreneurs.” Driven by a commitment to create a social venture that was measured beyond the

ruler of financial performance, SET saw its development and commercial projects as “different

expressions of one family.” Mouzawak outlined his take on how he saw SET:

We are not a non-profit, nor a business enterprise. And we definitely are not a

philanthropy! No one needs charity, charity is seen at temporary, short term, not

sustainable and a business is too impersonal.32

Codsi explained the process of deciding between development and commercial projects.

We create incubators to nurture ideas that follow our overall mission. We seek to

naturally evolve as an organization and a business. We have one vision, with different

models to achieve it. We seek to break this system that defines the lines between business

and NGOs.33

Indeed, Mouzawak and Codsi both made a conscious effort to ensure that decisions to pursue

new ventures, aligned with supporting small farmers and local culinary traditions. They

summarized as follows:

The land, its people, history, production, food and traditions underpin the very existence

of the Souk el Tayeb. Souk el Tayeb has evolved in the past six years from an

experimental farmers‟ market promoting small scale farmers and producers, to a vibrant

organization working on many levels and projects, nationally and internationally, to

promote and preserve Lebanese food and culinary traditions, rural heritage and our

natural environment.34

New opportunities

Seven years since the inception of SET, Mouzawak and Codsi purposefully avoided defining

their hybrid social venture in order to allow it to naturally evolve into different developments and

commercial projects. By March 2011, Mouzawak and Codsi had created a social venture that not

only gained traction as a grassroots movement, but had also had achieved a profitable revenue

stream.

This social venture set-up, allowed SET to achieve donor independence. The significance of this

accomplishment was that SET had been able to avoid mission drift – a common obstacle for

many socially driven organizations that were forced to change their goals based on funding

cycles. SET, however, was able to have complete autonomy over their products and programs.

Using their financially sustainable model to invest in new initiatives, SET was able to set their

own agenda instead of molding their venture to donor‟s objectives.

32

Interview, Kamal Mouzawak & Christine Codsi: August 7, 2010 33

“Kamal Mouzawak: An interview with the founder of Lebanon‟s Souk el Tayeb,” November 16, 2009 http://jackson.linefeed.org/blog/?p=93 34

Souk el Tayeb Website: http://soukeltayeb.com/

13

Having also established strong brand equity through the SET brand and the recent success of

Tawlet and Dekenat, Mouzawak and Codsi looked to continue this momentum. They believed

this could be done by developing new profit bearing projects, that would be coherent with their

social mission, to support additional income-generating opportunities for small farmers while

preserving traditional culinary practices.

While Mouzawak and Codsi had until now been indifferent about their organizational structure

and the interplay between the various SET initiatives, outside investors interested in franchising

the model in the Arab region, and the possibility of investing in a new project, Eco Village – an

organic market, meeting space and restaurant under one roof – forced them to think strategically

about how their venture should be structured moving forward. Specifically, Mouzawak and

Codsi pondered the following questions:

1. What mix between new for-profit initiatives and SET‟s core development programs

would continue to provide for financial independence while also extending SET‟s

mission?

2. Should SET expand operations internationally into the Arab region? If so, should it focus

on development programs or commercial projects?

3. What was the role of the SET brand in its commercial projects? Could more be done to

unify the brand identity between its development and commercial projects?

14

Exhibit 1: Picture of SET Farmers Market

15

Exhibit 2: Food and Feast Promotional Material

16

Exhibit 3: Income statement for SET development programs (2004-2009)

Source: SET

17

Exhibit 4: Profile of Suzane Doueihry, Tawlet Chef

Exhibit 5: Pictures of Tawlet

18

Exhibit 6: Tawlet and Dekanet Income Statement (2009-2010)

Source: SET

19

Exhibit 7: Dekanet Organic Packaged Products on Display (Includes labneh, honey and

rose water)

20

Exhibit 8: Newspaper Articles

21

22

Source: NYTimes, “A Lebanese chef‟s vision: Make falafel, not war,” August 16, 2007

23

Source: The Daily Star, November 2009

24

Source: Time Out Beirut, October 2009

25

Source: Sydney Herald Tribune, July 2010

26

Exhibit 9: SET Application Form to Ensure Quality Control

27

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