As We Navigated the Evolution of the GoldX Business Model

This is the story of the business model evolution of GoldX.  I'm deeply honored to share the story of how our initial vision, a mere concept of a gold trading business, blossomed into a social innovation model. for a gold trading business model evolved into a social innovation model. This transformation was not happenstance as it was crafted meticulously through intensive data collection and rigorous qualitative research analysis. Guided by the invaluable mentorship from our esteemed professors at the Asian Institute of Management (AIM), we embraced startup frameworks that infused life into business model design.


The Compassionate Gold Model: A Heartfelt Initiative

BAN Toxic's Executive Director Rey San Juan in the launching of 'Compassionate Gold' line of fashion jewelery and business model during the Philippine Fashion Week on 23 November 2018in Makati City, Philippines.

The initial framework, dubbed the "Compassionate Gold" Model, aimed at fortifying ethical mining practices within the Minahang Bayan. Championed by our partner NGO BAN Toxics, we initially throught of adopting the IP-protected "Compassionate GoldTM" metrics that comprise eight parameters and 42 sub-parameters for due diligence monitoring. The Compassionate Gold logo has been trademarked by BAN Toxics and serves as a tribute to the T'boli's amazing system of ASGM. Alas, the miners found these well-intentioned metrics financially burdensome, revealing the delicate balance required between ethics and economic viability. The early realization that even its initial customer segment – the local jewelry industry - faced practical challenges highlighted the complexity of the model. While the "Compassionate Gold" Model represented an elegant vision inspired by the pioneering work of BAN Toxics, the pragmatic lens of a Lean Startup demanded a pivot, urging us to craft a new strategy.

The Financing and Logistics Model: Navigating Practicality

On our way to the mines!
We needed to know what's on the ground. We need to immerse in the pain paints of the ASGM community. So, after office [yes, we still have our day jobs!], we had to drive for 8 hours to visit some Minahang Bayans in Camarines Norte. Barely having a shut eye, we crossed a raging river and trekked up the mountains as the rain started pouring.  Or phones were sending notification that Supertyphoon Karding has just entered the Philippine Area of Responsibility. We were these brave souls who risked life and limb to understand the enigma of the ASGM. 

As soon as we reached our destination, we were met by warm members of ASGM cooperatives who prepared a hearty meal.  After a pleasant conversation we organized focused group discussions and starting our immersion. At the end of the day, we unearthed two key pain points of our small-scale gold miners: logistics and financing. These stumbling blocks formed the cornerstone of our evolving narrative, leading to the inception of the "Financing and Logistics Model." Yet, after crunching the finances for rehabilitation of a key pilot Minahang Bayan, the substantial investment needed proved a hurdle. It was also compounded by early security risks and regulatory challenges in the area. Despite the ASGM miners' dire need for financing, lending millions for Minahang Bayan infrastructure, though vital, was not financially viable in the early stage of our startup journey. Agility in the bootstrap environment of a startup compelled us to reconsider our approach.

The Inclusive Empowerment Gold Model: A Social Innovation 

This was when we realigned our compass. We revisited the insights from our observations during community immersions and exhaustive interviews, and meticulously crafted the "Inclusive Empowerment Gold" Model. This model reaches deep into the veins of the entire ASGM supply chain, ensuring every participant receives equitable compensation, providing vital regulatory guidance, and fostering empowerment through a transformative social contract.

Polishing the Details of the "Inclusive Empowerment Gold" Model

Sankey diagram of ASGM social model assumptions and thematization
Developing the "Inclusive Empowerment Gold" Model was no small feat. Our GoldX's team initially generated 212 business assumptions crucial for developing a business model within the Lean Startup framework. After removing duplicates and merging similar assumptions, we consolidated 109 assumptions. These assumptions underwent a two-level content analysis. The first-level analysis used IDEO's Desirability-Feasibility-Viability (DFV) framework to assess each assumption. The second-level analysis thematized the assumptions according to the features of the ASGM business ecosystem and the sustainability 2018 business model framework by Lüdeke-Freund et al. Six themes emerged: (A) Formalization and Compliance, (B) Market Access and Value Chain Addition, (C) Sustainable and Ethical Practices, (D) Relationships and Community Ownership, (E) Traceability and Transparency, and (F) Supply Chain Optimization. Through the Delphi Method, these assumptions were prioritized. Qualitative research through interviews with 20 stakeholders validated these assumptions. This meticulous process of problem-validation and problem-solution fit analysis allowed startups, like GoldX, to identify and address potential risks and uncertainties before committing significant resources, culminating in the development of our business model.

The Importance of Strategic Alliances

Crucial to the evolution of our business model were the strategic alliances forged. Partnerships with NGOs, government agencies, and local communities are the bedrock of our strategy. The introduction of the "Empowerment Gold" seal trademark and the proposed implementation of buying stations are seen to bolster our reach ensuring a seamless connection with our valued stakeholders. 

Beyond the metrics and models, GoldX also champions a humanized approach. By empowering ASGM communities, nurturing sustainable practices, and eliminating mercury use through industry collaboration – and not mere regulation and education, we pave the way for a harmonious coexistence between humanity and nature. Our commitment lies not just in profits but in the profound impact we make on lives and environments.

GoldX Co-Founder Lana Revista presenting a root cause analysis of ASGM and explaining the "Inclusive Empowerment Gold" social innovation model during the 4th National Assembly of Small-Scale Miners of the Philippines on August 4 2023 at Koronadal, South Cotabato, Philippines.   

As we journey forward, we are not just redefining the narrative of gold production. We are crafting a story of empowerment, one community at a time.

Acknowledgement: We thank Ma'am Arleen Honrado and Arlene "Parekoy" Galvez of BAN Toxics for guiding us in this journey and connecting our team to the small-scale gold miners; the ASGM stakeholders for giving us time, sharing the knowledge of the small-scale gold mining ecosystem and friendships; and our esteemed AIM professors for mentoring us how on how to go about problem validation, problem-solution fit and project implementation design.   

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