Sanja Milosavljevic: Hello, welcome to Mondopreneur podcast. We are trying to share stories of successful women all over the world to see how they are doing in these challenging times and what are their plans for the future. Today, my guest is going to be Enrika Arena and she comes from Italy. She’s from Sicily but she lives in Milan. So, hi Enrica, how are you?

Enrica Arena: Hi Sanja I’m fine, thank you. What about you?

Sanja Milosavljevic: Well I am also fine. As we discussed earlier, before we started this interview, I had a very challenging two months but now I am totally fine. Thank you for accepting our invitation to participate in this project. I think that you are a very interesting lady. Your story is very- how should I say, not just interesting in terms of what do you do but the most fascinating thing about you and your job is that you predicted the future and that you actually ran towards the future. Can you tell us something about yourself? What do you do, what is your educational background and, you know, something like that. Just a small introduction.

Enrica Arena: Yes, so – I’m 34, born in Sicily. As you said I live between Catania and Milan and I studied as a background in communication and languages in Milan. Then I started to move towards development incorporation and development studies, so more about the political side I would say, but always with a merge with communication. So I always wanted to have an impact somehow, but kind of trying to navigate to international organizations and NGOs and the private sector. 

Sanja Milosavljevic: And what do you do? I think that your company is something very, very interesting. The thing that your company does is very interesting. Can you tell us more about Orange Fiber.

Enrica Arena: Yes for sure. So, my company is producing a fabric for fashion, starting from citrus food byproducts. That is to say all the leftovers of the food industry – the orange juice, lemon juice industry. So imagine for one second that when you have a fresh orange that is squeezed half of its weight and 60% is just a waste or byproduct that gets to be disposed of in the household. You just put it in the organic waste. But at the industrial level it’s quite a cost and also can represent an environmental challenge. So we have developed a process to transform these leftovers into innovative materials for fashion.

Sanja Milosavljevic: Perfect.That’s why I said your story is very interesting and that’s why you are heading towards future. What is sustainability for you? When you speak about sustainability what do you think?

Enrica Arena: Well I think it’s super complicated to define sustainability. Sometimes it relates to the environment and social impact. I think it’s a way to really encompass different pillars of how things are produced. So, in our case it has to do with the surplus of the raw material with the process that we use, but also it has to do with the clients. So, we want to work with people who are either already sustainable in their production or who want to start a process towards sustainability. Because frankly speaking nobody and no one is really sustainable nowadays. So it’s really a process because you start from materials, then you have the electricity, then you have the logistics and then you have the salaries and so much and so on. So it’s really completely different mindset that I would rather define as ‘aware’. So we have to make our choices understanding that whatever we buy and whatever we do have an impact. And we can decide where to allocate our positive and negative impact every time we buy or do something. 

Sanja Milosavljevic: So, who is your major client. I know about two, but can you share with people who are your major clients?

Enrica Arena: Yes, so we normally work with fashion brands. So, we take care of the world production supply chain, but basically we sell to brands, fashion brands. So our first client ever was Salvatore Ferragamo, a fashion house in Milan- sorry, in Florence. And they are Italian and they are quite renowned for quality in general in the raw material. I hand material at the end and they are very focused on sustainability. So our first collaboration with them was back in 2017 and after that we collaborated with H&M for their conscious exclusive. So in 2019. So it was a totally different story because they are Swedish and they are multinational on so many different levels, but they are also very committed towards sustainability. 

Sanja Milosavljevic: So, perfect. Because people can relate with H&M they are a huge international brand, just to make them think about what is a sustainable material for fashion. Do you have any insight about the circular economy, or blue economy or green economy? Is it something that is popular in Italy or is it something that is just of a personal interest of people who are running their own business?

Enrica Arena: Well I think that a sustainable economy or blue economy is something that is becoming now more and more mainstream in Italy. Of course this is related to main European policies that are now- some are translated into the national or local level I would say. So I think there is a bigger legal framework that is coming into place also in terms of incentives or grants and opportunities. Of course education is also very crucial to understand why sustainability matters. And in particular in fashion I think it really has come after food understanding what is the supply chain, where the products come from. Starting from the egotistical point of view – so, I buy something organic or something artisanal or handmade because I think it’s done with more love or more care and it’s less harmful and positive for my health. These also trickle down to fashion. So on one hand we buy sustainable because we want organic cotton on our skin instead of something from oil for instance. But also it has become a little bit more planet related. So we don’t want to do harm or we want to contribute. And I think this is super interesting and I think also the final word is following. So now there’s a lot of discussion around ISG permits when it comes to finance and big investment funds. So when we started our company this was really kind- not even a blue ocean but rather like a solitary desert because nobody was even interested in investing in sustainability. Now we have been invested by Impact Funds specializing in investing in women entrepreneurs. That has become also a factor where a lot of jobs are created, sustainability in general. And where a lot of specialization and professionalization is taking place.

Sanja Milosavljevic: Perfect. Do you use any of this in any stage of development of your company? Have you used these investment funds, or Angel investments or crowdfunding campaigns? Did you use these kinds of things to gather money for your business? I’m asking you because this is something that’s just starting to develop in Serbia. We don’t even still have investment funds that are available for startups or for entrepreneurs. What’s the situation in Italy?

Enrica Arena: Well, consider that we started as an informal group of people in 2012 and created the company in 2014. So we are now almost 7 years old as a company and as a group 9 years old. So the situation has changed over the years. I would say that at first it was really self-funded and the family and friends. But we were applying to a lot of startup competitions where you would have rather than money, more like mentorship or people who would introduce you to relevant people that would give some insight or develop a business plan for those like us who didn’t really have economic background in our studies. This also builds up credibility of a new company. So when you’re awarded with a prize even if there’s not money behind it you gain the network and maybe you find the right person afterwards. Then we connected family and friends’ money. So I would say 100.000 euros from Angel Investor. But to get there you also need to create a proper business plan, have an evaluation of your company. So it’s not something you do overnight. So it requires like six months of work pretty much. Then we also applied to National Opportunities for Funding which were European funds managed on local – National or Regional level. In that case you never really have – not in my experience – something that funds the totality of your project. It’s more like co-funding specific projects. Whether it has to do with – in our case – buying machinery or hiring people. So it’s like you need to find some investors anyway and then use the money you get from investors to leverage public funds. So somehow to multiplicate the results you have with that same amount of money. And with that we arrived to the point where we had this prototype then this production and then this client through a gamble. So after that we needed to improve the process but also scale the production. So at that point we tried to raise money with round A which is like in Italy considered like 2 million euros, but it was really not at our level I would say. Because we had not enough stories of clients and delivery and KPI’s so we decided to go for equity crowdfunding which is a way of crowdfunding that enables you to serve stakes of the company to total strangers. But again this has to be seen not just like you put your project on a platform and money comes in. But it requires a lot of investment from any point of view. So, communication, finance – which is not impossible – I mean you are investing and then you are harvesting what you invested. In between 50-60 thousand euros – some of them were taxes fees. So like you pay up front and then you pay the rest if the campaign is successful. But all in all I think 10% of the toal has to be considered like an overhead. But we raised 650000 euros. And we have now 350 strangers that are stakeholders of the company. Not all of them have power. So some of them can’t even vote. Only the people who have invested more than a certain amount of money have special rights on the company, so they are not slowing down the execution processes. So I think these tools are super useful but they are not really the magic we think. Like it took us one year to build a campaign and be credible to the investors. So it’s work but the good part of the crowdfunding in my opinion is that you know when you are starting and you know when it is over. While normal conversation with an investor can take forever because you’re like “Okay we will update each other in two months” and then after three years you are still there updating each other and not really closing the deal. 

Sanja Milosavljevic: Yeah I know. But still if they can invest and it can improve development of your company, then it’s also worth waiting. But I agree the crowdfunding campaigns are time limited so you basically see the results sooner. Nice. I remember – we met in the States. We were together in the IVLP program. And I remember- and you mentioned it earlier – I remember you said something about mentoring and mentorship and mentorship relationship. Can you tell us something more about- what is that for you? And do you choose a female mentor or a male mentor? Who do you think is a better match for you?

Enrica Arena: Well I have quite a mix of male and female mentors and I don’t really have a 1 mentor to whom I have a continuous relationship. I’d rather have a few mentors about specific topics. So it’s more like when something is complicated or controversial I tend to go to someone I may have met at an accelerator or boot camp or some other reason and ask them like one hour of their time to discuss a subject. Of course it’s not something you want to abuse. Because at the end of the day most of them are professional persons so they are also paid for it. So for instance with one of them we have secured a contract so they will be a formal part of our advisory board. So they have to deliver results and also be present. But with most of the others it’s really informal how we conduct it. But it’s really- like when you’re an entrepreneur you’re always so overwhelmed by day to day activities that you totally lose track of the global vision. I mean, you have the global vision and maybe you also have a business plan and maybe you also have an action plan or maybe it’s just in your head. But you really need to have someone external to remind you and enable you to rethink why you are doing what you’re doing or maybe you can do it better. Because otherwise I tend to keep the status quo as long as it works. Even if it’s not the best, it’s like – it takes less time and less effort sometimes to keep- we feel that it takes less time and less effort but in the long run I understand it’s better to find the problem when it comes. And if you can’t solve it just find another way. And this was something for instance that came from a male mentor from the finance ward. Because also I don’t know if it’s for every female entrepreneur or just me, but I tend to feel like I don’t know everything about the subject and I want to learn more. And by the time I learn everything it’s already too late to act. So having trusted people that are quite knowledgeable about their sector also speeds up the decision and they are able to understand the problem you are having or at least challenge you with- I mean, they don’t have the solution. They rather have the question that enables you to navigate through your problem and see it in a different light.

Sanja Milosavljevic: And what do you think about the community and returning to the community?

Enrica Arena: Well I can say is that I hope to do that as soon as possible because that means that we have revenues. (laughter) No, but apart from that I think that it’s- I mean in our case returning to the community or being mindful about the impact it’s really in our DNA. So, it’s what we do every day, so-

Sanja Milosavljevic: Can you explain? Can you explain what you mean when you say ‘in our DNA’? Can you explain more?

Enrica Arena: Yes, it’s like being a sustainable company or impact-driven company, whatever we do we do like having in mind either our local community or in general the best interest in our opinion of our planet. So we don’t do that just for profit, but we do that mainly because we want to be an alternative to a more polluting material for instance. So the community in a broader sense is part of our DNA in that sense. On a specific level, for instance, we are super open to people, for instance – male or female we don’t really care – but I understand that our level of flexibility for instance has been a great tool for people, especially for women that maybe has just had a child and were looking for a job that doesn’t really require you to be at the office eight hours a day. Or that were out of the job market for a while but they are super able to work even if the situation was confused. So, I mean we try to hear, we try to listen but I really hope that in the future we could do more in terms of education and in terms  of giving back to our community in the local sense. But also I think- I feel like I’m part of a presence in the community of sustainable material. For instance we are mentoring each other sometimes or providing introduction to brands or to potential research centers, so I think community and giving back is something we can relate to different layers of our everyday life. So for instance now with the COVID situation the sense of community is like “okay I buy from a small shop instead of ordering something online”. So I think again we really decide and define which community we are in and we feel part of it in how we contribute. So maybe I ordered delivery from a restaurant instead of cooking because I want to support them in this difficult moment. So it’s- it can really depend. But it really impressed me the way during our IVLP exchange program how in the US it was perceived that sense of community in terms of also donating our- for schooling other people’s children, or baking cookies for the homeless. So it’s really something that I don’t really feel around me yet, but that I want to apply as soon as possible in a structured way in reality.

Sanja Milosavljevic: Yes, I know. I actually remember we were together in…oh, I forgot the name of the biscuit house…nevermind. But actually at that point we discussed about community and returning to the community and what are the ways to contribute to the community. It’s not just the money, it’s your time, it’s your knowledge. It’s being mindful and careful towards nature and what’s surrounding us and towards resources we use. Can you tell us something about COVID situation in Italy? Because once it started people in Serbia, we were looking at Italy like Italy is going to give us all the answers. Because you had the dramatic situation at the beginning of the pandemic. So we were basically watching our national TV and then we would watch, I don’t know, Rai or something like that and go to the portals and try to read some news and some advice. So what was the situation in Italy in February and March?

Enrica Arena: Well of course this is just opinion because I am not a doctor and I don’t know what was the real situation. But the perceived situation was that all of a sudden we were hearing these news from China. And from an entrepreneur point of view I had some shipments that were delayed or taking just too much time to arrive to Italy, but this was not yet a clear connection with the pandemic. So it was more like okay, things were particularly slow. But after Christmas that happens that all of a sudden there was this Corona situation – I was like in Belgium with my family because my dad lives there. It was total panic. We didn’t know if we were allowed to come back to Italy and what would happen when we came back to Italy. So at first it was panic, then it was okay. Everything is- you can go around until six PM, so it was relaxed for a while. I also came back to Sicily. It was not so much but it was like okay we are trying to figure out. Because it seemed like only a few cities were hit by the virus and then all of a sudden in March everything shifts and we were locked-down for, I don’t know, like two months. And like often, things happen and then life follows. So it was like okay, we rent a house- I rent a house in Milan for work. And all of a sudden this house was empty for two months. And I was totally scared that someone could enter and I don’t know. So you run into so many strange fears like all of your things are just there and you cannot have a look. And you start looking around at people when we can go out again or maybe when we go to a supermarket and we’re looking at each other like ‘maybe you have COVID’. And so it was really strange at first and I think the impact on the small and medium enterprises has been incredible and still I think most of them are trying to figure out…some restaurants I’ve seen in my- where I live in Milan for instance never reopened. And even here in Sicily. So this really hit those sectors. I mean, the most basic everyone will see, but the sectors in which it’s most visible is the ones that are living on daily revenues from clients walking in. So even small shops and stuff like that. And we are about- we are waiting in this minute to have a new law. On red, oranges and green zones. So it’s like again we don’t know what will happen in the next two months.

Sanja Milosavljevic: Now with the experience from March, can you say that you are better-prepared or still you cannot influence and you cannot change anything, it’s out of your control?

Enrica Arena: I think it’s out of everyone’s control. So I have my tracking app on my mobile but I never received a notification. So it’s like maybe I was just very lucky or maybe there’s just a missing part because you need your doctor to enable you to signal if you are positive. So a lot is still left to people’s choices. Which is good, but when it’s so big I don’t know if it’s so good. Not to be controversial. But like I was doing my test because I was on a second-level contact with someone who was positive. So I let the 10 days like, when I knew we were already past 10 days from the regional contact. So I tried to go for a test but everything was test, so I went for a serological- I don’t know the word in English test. And then like I see that you can choose whether you want the result to be or not to be communicated to the national authorities. So it’s like okay. Why is that even possible? So there’s a level of discretionality that I think should not be left to the personal level at this moment. Because we all- I want to still work and everyone that- I can’t imagine people who have their own family to care for they don’t want to be locked inside for 30 days or 10 days. But on the other hand we can’t really- like one person can really trickle down to so many new cases that is I think now the fear or the situation right now that I see is that – it’s not about the death. I mean of course there are people who are dying because of this and that is terrible. But the worst thing is that you cannot access or- the access to normal health care has been almost stopped. So this of course is very heavy on the elderly but also people who have recurrent conditions. And also so you don’t really do a lot of screening or your surgery that was not necessary was postponed so a lot of things that maybe were small at the time then with time could increase their severity. And also what we see now a lot of people were cured in their household so they are not really saturating the health system but still it’s a heavy weight on the health system. So, the number of that is increasing in exponential ways, but if you compare it to the number of people who have just contracted the infection and you know that when they have contracted the infection a percentage will need hospitalization anyways, then you see how much this would cost in the system. As a wall in terms of not availability of resources. So I think we can do better. I don’t think anyone has solved this situation yet. So, it’s more in control so I think now people are cured better because they know how to deal. But still they need like 10 or 15 days of hospital if the situation is severe and then that’s really distracting from other health priorities.

Sanja Milosavljevic: I know, I know. I had some small issue a while ago and the first thing they suspected is that I had COVID. And I was like no, but there are still other health issues that are not related to COVID. You can have a high temperature that is not connected to COVID, it can be whatever. But still it’s a huge burden for- also in Serbia for the health system. So do you expect another lockdown? Or are you-

Enrica Arena: Well, they have already announced it actually.

Sanja Milosavljevic: Already? For the whole Italy or for just a part or certain towns.

Enrica Arena: That’s what we are trying to figure out. Yesterday there was this discussion from the president saying that okay we got the numbers and the numbers are getting worse. There are parts of Italy that are more hit and other parts that are less hit. We need to relate these to parameters in the health system in that particular region or area. Because maybe you have less infections but still you have less hospitals so how you handle that. So they are dividing- there are some measures that are for the whole Italy, that will- like we are waiting for the decree to be public to understand. But the situation looks like there will be some national-level restrictions. Stricter than the ones in place now. And then there will be three zones. Like some of them will be totally locked down, some will have a mild lockdown and some others will keep like the current level of the restriction plus the national level of restriction. It has already been announced. We- it doesn’t look like it will be a total lockdown yet – hopefully ever. But for some regions it looks like it will really be similar to the first one.

Sanja Milosavljevic: That was shocking for me, the first lockdown was shocking for me. But I think now if they announced a total lockdown I would organize my time and my emotions another way because now I have some kind of experience. What is that going to do- or how is it going to harm your job and your business?

Enrica Arena:  Uncountable. No, I mean – already fashion, I mean as a system in Italy has been really suffering a lot. Because if you think about it in January-February you are out of the sale like post-Christmas reduction and you are about to have the new collection in shop. Which was partly produced but never really sold. Then you had all these times when you couldn’t really open the shops and then you had Summer where a collection that was not really there yet- sales that were not sales because you didn’t have backup production. And now that we are entering again in the loop like most of the major firms were totally cancelled or virtual. So brands are living this uncertainty about the quantities and about the collection and about will they even be able to sell. So the fact that now that we will most likely lose the moment of the year when most of the sales actually happen which is Christmas, is really putting the world of the fashion system under incredible pressure of uncertainty of what will happen next. Because it’s not just about shops, it’s about people who don’t know if their jobs will be there the next month. So it’s also that people are less ready to buy and spend money on things that they don’t really need. Because we don’t really go out of our houses, we just stay in pajamas the entire day. So, there’s a- I mean in general the system is now living quite crises in terms of uncertainty and in particular what I am doing as a company is waiting to understand if the supply chain stays in place and when will it react. Because already in October we are seeing a slowdown in the companies and the lot we work with because in other European countries they have already started with soft lockdowns. So you can have less people in the labs and you can have people working from home so the normal working conditions are already altered. And if it’s stronger lockdown will be enforced, this means- I mean we were expecting to launch a product in June. Then, now we were expecting to launch the product in February. But I mean it looks like…

Sanja Milosavljevic: I know…what do you think, how long this altered situation is going to last?

Enrica Arena: I have no clue, but I think 2021 is already a little gloomy unless they get come out with the vaccine and very big availability of it, I fear we have this open and closed situation going on for a while. And so I don’t know. But I mean, for us as a company if June next year we are not able to close a deal or sell something then it will be two years in a row without selling and it’s like…

Sanja Milosavljevic: It’s not sustainable from the business..

Enrica Arena: It’s not looking good. So hopefully we will find a way and brands will embrace the risk of buying materials but I totally understand the uncertainty is for everyone. 

Sanja Milosavljevic: It’s strange how some sectors or some industries were- had the great opportunity during COVID like the food industry. But some other sectors and some other industries like tourism, fashion and some things that people just couldn’t- if you cannot travel you cannot travel. Or as you said if you’re staying at home and working at home and only wearing pajamas you don’t need a new pair of shoes or a new blouse. So they were hit very hard. Sometimes I think that normal people cannot even understand how it influences those kind of industries like tourism or fashion. So, we already came to the end of the conversation. What would you say, what will be your message?

Enrica Arena: Well, I think that the sectors that were hit so much somehow are not so necessary. So, I don’t want to be mistaken – fashion and traveling and discovery is definitely something that we need to evolve, to also be ourselves and to communicate with the rest of the world. But maybe the way that we were doing these things – the production, supply chain or the super low-cost flights made the whole system overcharged. So I think leaving these things as a luxury – not in terms of luxury but rethink and actually live at fullest when we travel because we don’t know if we get to do that again soon. Or buy something and wear something because we are going to dinner with friends really takes a different flavor. I think it’s useful for us to get out from that ‘everything is available 24/7 just hitting a button.’ So just thinking that there are companies there are families behind whatever we buy, or whatever we do. So I think this is- will turn to be positive if we find a way to sustain dead jobs in some other way. So my message will be this has been an incredible loss of course of people and opportunities and business but it has also been an incredible opportunity to rethink our system that we would never do if there was not an external force to oblige us. So if that will turn into an opportunity to be more conscious in how we use our resources in terms of income but also in terms of materials, also in terms of food. I think it’s- it could turn out to be a crisis with a good message at the end of the day.

Sanja Milosavljevic: With positive outcome, yes. I agree, I’m somewhere- I have some similar feeling about this COVID and this situation. How we can actually use this opportunity to change our habits, to change our- especially consumer- consumerism habits. Thank you Enrica, thank you very much. I hope you enjoyed our conversation.

Enrica Arena: Yes, definitely!

Sanja Milosavljevic: I’m so glad I had an opportunity to see you and to speak to you. So, thank you for listening, thank you for staying with us. You can always follow us on social media. You can find us on YouTube and on some other audio platforms. And if you like you can Subscribe and you can share and tell your friends about us. So until next week, stay good and stay in good health.