This case study explores KOTO, the first social business in Vietnam, from its founding in 1999 to 2019, including its development, achievements, and challenges. The research draws from reliable online resources to provide an overview of KOTO’s social business model. The insights gained from studying KOTO’s story can inform SeedU’s understanding of social business and potentially lead to collaborative strategies between SeedU and KOTO for mutual business expansion.

2. KOTO Vietnam Background

2.1 KOTO Story

KOTO was founded by Jimmy Pham to provide vocational training and education as a pathway for underprivileged youth to overcome challenges in life. Born in Vietnam in 1972 and later immigrating to Australia, Jimmy studied hospitality and developed a passion for travel and tourism. During a visit back to Vietnam, he encountered homeless children who expressed a desire for skills and stable jobs. Inspired to make a difference, Jimmy decided to permanently return to Vietnam and established KOTO with the mission of improving the lives of underprivileged youth.

Recognizing the potential in these young individuals, Jimmy aimed to create a business that would break the cycle of poverty, and build a brighter future. Education became the key foundation for their personal growth and job opportunities, and Jimmy identified a need for reform in Vietnam’s vocational education system, particularly in hospitality and culinary arts. As a result, KOTO opened a training school with free housing, meals, and comprehensive soft skills and vocational programs lasting 1-2 years. Additionally, a restaurant was established to provide real-world practice for the students.

2.2 KOTO Overview

KOTO, short for “Know One, Teach One,” is a non-profit organization in Vietnam that empowers underprivileged and at-risk youth through comprehensive hospitality training. Founded by Jimmy Pham in 1999 (after starting in 1996), KOTO began as a small sandwich shop in Hanoi’s Old Quarter during Vietnam’s rapid economic development. The shop, located near the Temple of Literature, soon transformed into a high-end restaurant.

Figure 1. KOTO Vietnam’s Vision Statement

Figure 2. KOTO Vietnam’s Mission Statement

Figure 3. KOTO Vietnam’s Culture Statement

20 years later, more than 1,000 graduates are executive and sous chefs, general managers of hotels and resorts, business owners, and recent college graduates. Everyone gives back to their communities and family.

KOTO Vietnam is regarded as a preeminent, distinctive not-for-profit social enterprise, both domestically and abroad. In order to break the cycle of poverty and truly empower trainees to realize their aspirations, KOTO now offers over 100 at-risk and underprivileged adolescents the chance to enroll in a 24-month holistic hospitality training program.

2.3 Evolution and Growth Proces

3. KOTO’s Business Model Analysis

3.1 KOTO Social Business Model

The figure below is KOTO’s social business model conducted by SeedU’s team.

. 3.2 KOTO’s Business Model Analysis

3.2.1 Customer/Beneficiary Segments

3.2.1.1 Customer Segments

Restaurant customers: Local diners or tourists who are looking for a one-of-a-kind eating experience with a social impact.

Retail customers: People who are interested in baked goods such as artisan bread, cakes, pastries, and other tasty treats.

3.2.1.2 Beneficiary Segment

KOTO Vietnam’s initiative targets those who encounter hurdles to education and work, such as those from low-income families, marginalized neighborhoods, or difficult life circumstances.

3.2.2 Value Proposition

Beneficiaries: KOTO equips disadvantaged youth aged 16 to 22 with vital life and hospitality skills by providing a training course with real-world experience

Customers: KOTO offers restaurant services with a warm friendly atmosphere and high-quality food and beverage selections.

Partners: KOTO enables its partners to promote their products and services, and strengthen their brand credibility and reputation.

Sponsors: KOTO provides a platform for sponsors to grow their name while making important social contributions.

Volunteers: KOTO helps them enhance their portfolios through hands-on experience by supporting KOTO’s events and operations.

Government Entities: KOTO asks for help from government agencies for its recognition expansion and vital resource support (finance, network, etc.).

3.2.3 Channels

Dining with a difference at KOTO | Vietnam Tourism

KOTO Vietnam communicates with its customers, beneficiaries, partners, and sponsors through a variety of touchpoints which are critical in promoting the organization’s mission, services, and products, as well as creating awareness regarding underprivileged youth empowerment. The following are the specifics for each communication channel:

Restaurants in Ha Noi and Ho Chi Minh City: KOTO runs two restaurants in Ha Noi and Ho Chi Minh Cities. Customers can directly engage with KOTO’s goals while enjoying a unique dining experience at these restaurants, which serve as vital communication channels. KOTO develops an atmosphere that invites consumers to learn about the organization’s social effects and contribute to its cause by providing friendly hospitality and excellent Vietnamese and international dishes.

Training school in Ha Noi: provide extensive life skills and vocational training for disadvantaged young people. Trainees meet with mentors, trainers, and staff in person to build a feeling of community and offer a touchpoint for direct contact and feedback.

KOTO’s website: KOTO Vietnam maintains an informational and user-friendly website that acts as a major information hub for customers, beneficiaries, partners, and sponsors. KOTO’s mission, training programs, social enterprise outlets, goods, and events are all detailed on the website. Customers can use the website to make restaurant reservations, book catering services, and purchase goods. It functions as a communication, engagement, and transactional platform.

KOTO’s social media channels (Facebook & Instagram): KOTO is active on popular social media sites including Facebook (KOTO) and Instagram (@koto.vietnam). These platforms allow KOTO to share with its customers and stakeholders the latest updates, stories, images, and videos about its activities, beneficiaries, partners, events, and accomplishments.

Partners’ social media and website: KOTO gains exposure through partners’ social media platforms and websites, where they post information about KOTO and its forthcoming events. This raises KOTO’s profile, broadens its reach to new audiences, and strengthens its legitimacy through endorsements from reputable partners.

3.2.4 Type of Intervention

KOTO Vietnam provides disadvantaged young people with:

free 12-24 month soft skills, English and hospitality vocational programs
free housing and eating during program
practical experience through working for KOTO (restaurants, fundraising, etc.)

3.2.5 Key Activities

For training school:

KOTO recruits trainees from all throughout Vietnam every six months
Build health checks and vaccines system for students
Manage daily meals and accommodation for students
Track education program quality to meet Box Hill Institute accreditation

For KOTO’s restaurants:

Manage facilities and food sources in the restaurant
Distribute students in different positions in the restaurant

For donations:

Yearly fundraisers: the KOTO Dream Ride in Hanoi and the KOTO ONE gala event in Ho Chi Minh City

3.2.6 Key Resources

KOTO Vietnam has real-world training facilities, including restaurants and a villa, where students gain hands-on experience in culinary arts, hospitality, and customer service. These venues offer practical training, customer interaction, and professional exposure. The villa also serves as supportive student housing during their training.

KOTO collaborates with partners, such as hospitality enterprises and educational institutions, to create job opportunities and career paths for alumni. Partners offer internships, apprenticeships, and work placements to enhance employment prospects. Educational institutions provide additional education options for graduates to further their studies and career development.

KOTO relies on sponsors and donors for financial support. Sponsors are corporate entities offering funds or resources, while donors are individuals, organizations, or foundations providing financial assistance for operations, training, and social activities. Their contributions are vital for supporting KOTO’s initiatives and providing resources for disadvantaged youth.

KOTO benefits from a dedicated volunteer workforce, contributing time, skills, and knowledge to various operations. Volunteers mentor and tutor students, provide administrative support, assist in restaurants or resorts, organize events, and share industry expertise. This volunteer workforce enhances capacity, personalized learning experiences, and ensures smooth program operation.

3.2.7 Key Stakeholders

The table below is a snapshot of KOTO’s key partners since its official establishment, which is taken from the British Council’s casebook in 2016.

Donors	EMpower, Project Happy Feet, Babonanum, GRM International, Donaco International, Vietnamese American Scholarship Fund (VASF), Center for the Encouragement of Self-Reliance (CESR), Hanoi International Women’s Club, International Ladies of Vietnam
Government (via embassies and consulates)	Australia, Canada, USA, Denmark, Ireland, Switzerland, UK, Germany, New Zealand
Government (via cultural cooperation agencies)	British Council, Goethe-Institut
Nonprofit, non-governmental organizations (NGOs)	LIN Center, Center for Social Initiatives Promotion (CSIP), HATCH!, Eaves for Women, Child Wise, Education for Development, Centre for Family Health and Community Development (CEFACOM), H2H, Mekong Plus, VUFO-NGO Resource Centre, Saigon Children’s Charity CIO
Restaurants and hotels	Caravelle, Park Hyatt, Sheraton, Hilton, InterContinental, JW Marriott, Sofitel, Jaspas, Refinery, Press Club, The Reverie Saigon, Hotel Nikko, MGallery, Serenity Holding, Fusion Resorts, Six Senses, Banyan Tree Hotels and Resorts, Pullman, Novotel, Hotel Equatorial, New World Hotel, Renaissance, Lotte, Villa Song, Pots ‘n Pans, Little Black Duck, LePub, The Refinery, Cousins, Emeralda Management Group, Last Call
Volunteer organizations	Volunteering for International Development from Australia (VIDA), Australian Volunteers for International Development (AVID), Australian Volunteers International (AVI), Young Australian Ambassadors Delegation (YAAD), Macquarie University, Participation and Community Engagement (PACE), Voluntary Service Overseas (VSO), Little Rose and Green Bamboo Children’s Shelters, Australian Business Volunteers (ABV)

3.2.8 Revenue Streams

KOTO Vietnam’s revenue is generated through a variety of ways:

restaurant and merchandise sales (main revenue stream): KOTO’s restaurants in Hanoi and Ho Chi Minh city, KOTO merchandise (sell T-shirts, aprons, and bags, ect,), KOTO bakery store
donations and sponsorships from donors and partners
financing from government initiatives

3.2.9 Surplus (Revenue after tax)

All income generated by profit-oriented activities (restaurants, catering services, and a bakery) are reinvested in activities (improve training programs, host social events, remodeling housing facilities, etc.) that serve to perform KOTO’s social goals development. KOTO Vietnam’s social enterprises are dedicated to providing great hospitality services to consumers while also supporting a good cause.

3.2.10 Cost Structure

The figure shows the main costs of KOTO Vietnam, conducted by SeedU team.

4. Lessons Learned from KOTO

For more than two decades, KOTO Vietnam has been able to make a good societal impact in the country. Many people have been inspired by their path, and there are various things that other social enterprises (like SeedU) can consider.

Focus on developing skills and empowering people: KOTO empowers disadvantaged Vietnamese adolescents through vocational training and life skills, benefiting both the trainees and the hospitality industry’s growth. They successfully equip disadvantaged youth with the skills to thrive in their vocations and produce industry-ready trainees employed by top hotels and restaurants. KOTO’s strategy and focus on high-demand skills could benefit other social enterprises.

Build a strong brand and get involved in the community: KOTO’s strong brand has national and international recognition. Their active community engagement helps with fundraising and raising awareness. The organization attracts new contributors and sponsors through their brand and interacts with the community through outreach projects, building a positive image and attracting trainees. KOTO’s branding and community initiatives foster a strong identity and trust for social businesses.

Support innovation and continuous improvement: KOTO stays competitive through innovation and program upgrades, incorporating input from trainees, staff, and consumers. They embrace new technologies, trends, and customized services, delivering greater value. Social businesses can learn from KOTO’s approach of focusing on innovation and continuous development.

Create sustainable revenue streams: KOTO sustains and expands by diversifying revenue streams, including a restaurant and catering business alongside the training program. This provides diverse income sources and work prospects for trainees. They establish lasting revenue streams through strong partnerships and sponsors. Social enterprises can learn from KOTO’s model by prioritizing long-term revenue streams.

5. Conclusion

KOTO’s business model focuses on vocational training and skills development for disadvantaged youth, and ensures that they have better career and life opportunities, as well as provides quality services in the restaurant and hospitality industry.

REFERENCES

British Council. “Vietnam Social Enterprise Casebook.” British Council, 2016, britishcouncil.vn/sites/default/files/vietnam-social-enterprise-casebook.pdf.
Kingsford-Smith, Andrew. “KOTO, A Culinary Charity in Vietnam.” Culture Trip, 18 June 2013, theculturetrip.com/asia/vietnam/articles/koto-vietnam-s-culinary-charity.
KOTO. “Who We Are.” KOTO, 2023, koto.com.au/about-koto.
My Guide Vietnam. “KOTO in Vietnam.” My Guide Vietnam, 2023, myguidevietnam.com/restaurants/koto.