10 – How a Small Business Can Help End Human Trafficking

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Sandra Morgan and Dave Stachowiak interview Cindy and Chris Haughey from Tegu to discuss how businesses can play an important role in ending human trafficking. The Haughey’s talk about why and how they started their business and the positive outcomes they have seen since.

Key Points

  • There is a 30% unemployment rate in Honduras, leading to a large homeless population.
  • Tegu is a for-profit business that generates jobs to address the homeless problem and exploitation by providing a sustainable income.
  • Tegu also works with other community organizations and partners to address the social issues in Honduras.


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Dave Stachowiak [00:00:00] You’re listening to the Ending Human Trafficking podcast. This is episode number 10, recorded in July 2011.

Dave Stachowiak [00:00:25] Welcome to the Ending Human Trafficking podcast. My name is Dave Stachowiak.

Sandra Morgan [00:00:30] And I’m Sandie Morgan.

Dave Stachowiak [00:00:32] And this is the show where we empower you to study the issues, be a voice, and make a difference in ending human trafficking. And Sandie, we have some great guests with us today to really help provide some wonderful perspective on some of the things we talked about last time. The push factors, the supply side of human trafficking. And so, I’m so excited that we have folks who are out there really being amazing advocates for this.

Sandra Morgan [00:01:00] Well, it’s fun to talk to friends living in Honduras, working on really wonderful models for prevention. I am very happy to introduce Cindy and Chris Haughey. And I’m sure I’ve mispronounced their name again, but they’ll fix that for me. I want to tell you how I met Cindy. She was doing the Hands that Heal train the trainer with us at Vanguard at the Global Center for Women in Justice and working on anti-human trafficking efforts as part of the coalition in Los Angeles. When she introduced me to Chris, and they eventually got married, I was absolutely fascinated with his incredible grasp of how far back up the stream we have to go to really make a difference. And his story is an excellent model of how we can start to make a difference if we’re patient in a way that will have really long-term sustainable results. So we want to dive right into this. And the first thing I want to do is ask each of you to give us a little bit of a bio. Just tell us who you are and get acquainted with folks.

Chris Haughey [00:02:22] Sure, we’d be happy to. My name is Chris Haughey and I’m one of the founders of Tegu, which is a wooden toy company with manufacturing based here in Honduras. Cindy and I live here and I’ve been running the factory here for a couple of years. Tegu really aims to be the world’s most innovative premium toy company. And we’re currently doing that by making some really cool magnetic wooden blocks. But prior to doing this, I was living in Los Angeles and working as a management consultant with the Boston Consulting Group. And Tegu brought me down here.

Cindy Haughey [00:02:59] And I’m Cindy Haughey and as you mentioned, Sandie, Chris and I recently got married a year and a half ago. And prior to that, I was living in Los Angeles working for Mosaic Church, as well as Los Angeles County Unity Coalition, and for anti-human trafficking. And ever since then, I really just had an interest in being an advocate for that issue. And now I’m living in Honduras and helping Chris with Tegu.

Sandra Morgan [00:03:27] So, Chris, when you told me about Tegu, your vision was much bigger than just making toys and making money. Can you tell me about some of the background to starting and how you chose to do this in Honduras?

Chris Haughey [00:03:51] Yeah. Tegu does have a larger vision than simply running a profitable company, making some cool toys. The idea really started with experience that I had in Honduras with a ministry in home for street boys. There’s a pretty big street kid population in Honduras and specifically in Tegucigalpa, the capital city. And my initial connection was in 2004 with that home. It led to some relationships being formed as the missionaries working there. Such that when I was back on business in 2006, an idea came up to try and start a for-profit business that would begin to generate jobs and extend the mission of the street boys home so that those boys coming out of the home and others like them would actually have some economic opportunities for themselves to earn a living wage at a purposeful and well-paying job, which is a real need in Honduras. So it really kind of started with an awareness that there are serious social needs. There’s a lot of poverty. And in particular, there’s over 30 percent unemployment here. And therefore, one of the biggest impacts that you can have on the society is creating an entrepreneurial business that over time will grow and will employ people as opposed to poor Hondurans without jobs, looking for other means of sustained sustainment for themselves, such as getting involved in the drug trafficking scene or other illegal activities, or for that matter, tend to go to the states where they think they might find better opportunities for themselves.

Dave Stachowiak [00:05:32] Sandie, I’m struck by what Chris just said as far as the unemployment rate in Honduras being at 30 percent. I mean, we think of the the recession going on right now here in the states and globally as the challenges people are facing here. And we were at the peak, we’re at 10 percent unemployment. So that’s three times the amount that is going on here in the states, right now. And so, you know, it really speaks to what we talked about the last episode is that being a huge factor for what could drive people into something like human trafficking.

Sandra Morgan [00:06:03] Exactly. Exactly. So, so, Chris and Cindy, is it pretty easy to go and start a business in an area like that with so much need?

Cindy Haughey [00:06:18] Is it easy? I think it’s a good question. Everything takes a lot longer than we would think. You would think because there’s such a need that they would be very open to having outsiders come in and start a business. But we’ve found that there’s a lot of difficulties along the way, which Chris can go into a little bit more detail about.

Chris Haughey [00:06:39] It’s unfortunate. It’s not easy to start a business in Honduras. And it really just has to do with the fact that this is the developing world. You don’t have the same infrastructural support that you would have in a country like the states or in Western Europe, for that matter. Everything from poor conditions of the roads, which affects transport in and out of the country, to a very bureaucratic government system, which on the one hand supposedly encourages foreign investment by setting up some nice tax incentives. But at the same time, the loophole, the hoops that have to be jumped through to actually run the business can be pretty, pretty time-consuming, and can be a hindrance just to getting things done. So it’s no, it’s not an easy place to do business. But we haven’t allowed the obstacles to deter us because the mission is more important than having an easy go of it.

Sandra Morgan [00:07:39] You see, and you bring up such an important aspect of this because I don’t want people listen to this program and say, wow, I’m going to go start a business in this country because they’re trafficking victims there. It’s things like the infrastructure for roads to move products. When we talk about push factors and the economic and socioeconomic issues, it’s really much, much bigger than just finding a way to employ at-risk kids, girls, men, women. But actually to make and build a sustainable business. So talking about building a sustainable business. I love your website, Chris. You want to tell us how we can access that?

Chris Haughey [00:08:30] Absolutely. Our website, simple, it’s www.Tegu.com.

Sandra Morgan [00:08:33] How do you spell Tegu?

Chris Haughey [00:08:38] Tegu is T-E-G-U. And it’s a short form of Tegucigalpa, which is the name of the capital city here.

Sandra Morgan [00:08:47] Okay. Well, I was at your wedding and instead of taking home wedding cake, we got to take home Tegu blocks. And I have them by my desk and play with them in the daytime. And it’s like, I’m not even a kid. I just love playing with them.

Dave Stachowiak [00:09:03] They looked like tons of fun. They look like fun, too. I had not been on your website until just now. I’m looking at it right now and I’ve seen you’ve been featured on The Today Show, which is exceptionally cool. And these look like really cool blocks.

Sandra Morgan [00:09:16] Yeah. So I can–

Chris Haughey [00:09:18] They are pretty fun.

Sandra Morgan [00:09:20] And ordering these blocks builds that business. So when I’m talking about building that business, then what does it look like? Do you have a factory? How do you do this?

Chris Haughey [00:09:34] Sure, well, Tegu is a business that’s actually split between the U.S. and Honduras. As we looked at the very best business model we could create given the conditions in Honduras, we started to think about the hardwood supply from the tropical forests of Honduras and linking that in a very unique and innovative way with a sophisticated consumers that you find in the U.S. and Canada, in Europe, Japan, etcetera. So it was an evolution, but we we came across the concept of putting really strong magnets in hardwood. So what that means today is we have a rented industrial space outside of Tegucigalpa. We employ about 50 people at the factory, both men and women. And most of them come from the area surrounding the factory, which is a little bit more rural because we’re about 30 minutes outside the city and some of them also come from the city and will take public buses to get there. So in addition to the production team, which is taking the raw material to the hardwoods and the magnet and transforming them into really beautiful and fun and functional products, we also have a small team in the states, about five people, that run our office up in Connecticut. My brother is actually my business partner and he runs the U.S. side of things. And they are primarily focused on the design of the toys and the sales and marketing to go ahead and get the toys out into the market. So that’s essentially what the business looks like today. And it’s worth noting that, you know, we are accomplishing the goal of employing people. We when we started the factory, we started hiring. We had about 10 people and then a group of 20 and then 40. And now we’re at a relatively stable for the time being group of 50 with the intention and hope of growing that group in 2012.

Sandra Morgan [00:11:27] Wow, that’s great. And I know that when you started this off, you knew that it would take a long time to see the actual results, to visibly be able to say, yes, this stops, this ends human trafficking. And I’m just wondering, can you tell us if you’ve been able to see those kind of markers?

Chris Haughey [00:11:55] Well, sometimes you can and sometimes you can’t because you’re not always aware of everything that goes on and in every person’s life. But we have seen some interesting things. Briefly, I’ll share. Last year we had a situation. We were in the process of hiring a new cadre of workers. We were kind of at an inflection point. We needed to grow some more. And we started to do some interviews with men and women from the surrounding area around the factory and the cousin of two of our workers, we have a couple of young women who work in our packaging department, they themselves are cousins. They had another cousin about their age who was interested in working for us and we interviewed her and we went to call her back about a week later and weren’t able to get a hold of her. About two weeks after we interviewed her, unfortunately, the family found out that she had decided to try and go to the states. She had linked up with a group going through Mexico and close to the U.S. border in northern Mexico. She was unfortunately the victim of a massacre of about 80 people. And it would appear that this group of people, many of whom were Central Americans, some were Mexicans, fell into the hands of a local drug ring who were going to traffic them supposedly across the border. And I believe that when they put up some resistance to the fees being paid, they were slaughtered. And it is incredibly sad. We obviously it was, it was a blow to the family of Carla and Stephanie, who work for us. And it was really sad for us to know that here’s a young woman that we were interested in hiring that had she stuck around and persisted in looking for a job with us or with some other business, you know, this would not have happened. So all that to say that’s a negative outcome, obviously. And very sad for both the business and especially the family involved. The positive side of that is that the people that we have been able to employ because they see an economic future for themselves, that they’re gaining an ability to support their families, to put their kids through school, and to have a future that’s bright, they no longer have an incentive to look for opportunities to go to the states or to get involved in other activities. And we do really see that. You know, I’m aware of employees of ours who in the past have either tried to go to the states or have thought about it. And now they’re looking at their job with Tegu and saying, OK, not only do I have a good-paying job today, but if I do well and if I show my, demonstrate my potential to lead, I can actually move up within the company earn a higher salary over time and enjoy an even better job of supporting myself and my family.

Sandra Morgan [00:14:57] So Carla and Stephanie are actually on the other side of that story. Because they have a job, they were not at risk for taking that chance for a better life. And that’s in quotes.

Chris Haughey [00:15:12] That’s right.

Sandra Morgan [00:15:15] So what are your next steps to continue building this business?

Chris Haughey [00:15:24] Well, we’re a pretty young company. We’ve only really been selling our toys for a little over a year. And really the next step for us is we’re a start-up and so we’re pre-profit, which means we’re still in the red and we have to continue to get the word out about our business. If we can do a good job of getting our toys sold both online where we sell them directly, as well as through the stores and chains that we sell through in the states, and we’re just about to launch in Europe, then that will take us to the point where we where we break even from a financial perspective, which creates financial sustainability for the company and then allows us to grow from there and and continue to foster the mission. So it’s, there’s a true. You know, for a for-profit business to make it in the long run, of course, you have to turn a profit. That’s important. And then from there, it’s continuing to invest in the mission, which is basically supporting employment and supporting sustainability in Honduras. We do that through forestry programs and working with some educational outlets as well. But the primary goal is over time, grow the business so that we can continue to employ hundreds who are in need of jobs and a need of hope for their future.

Sandra Morgan [00:16:42] I think maybe–

Cindy Haughey [00:16:43] Sandie, I would add to that. In terms of my involvement with what the next steps are, because of the story that we had of the cousin of Carla and Stephanie, Chris and I were talking about it’s not just our interest in providing the surface needs of providing jobs, but after that situation, we started to discuss, you know, what kind of hope do these people have beyond just having a job? And so that’s when I started a Bible study that was optional for any employees to come start to attend after work on Fridays, in order to provide a deeper meaning to their lives. And that’s been going well for the last couple of months. So.

Sandra Morgan [00:17:26] That’s great. And you’re learning Spanish too, aren’t you?

Cindy Haughey [00:17:30] Yes, I am doing that study in Spanish, which they help me.

Dave Stachowiak [00:17:36] I have a question for either of you. You both, both of you had some organization and business experience prior to coming to parts of doing what you’re doing now. And I’m looking on your website and the social mission is featured very prominently–employment, environment, education. And I’m curious, what decisions do you make differently as a business owner with a social mission that you maybe wouldn’t have thought about in the past or wouldn’t have done in other roles or done in a business that didn’t have a social mission?

Chris Haughey [00:18:12] That’s a good question. It takes several forms for us. Probably the easiest one to speak to because it’s less nuanced is the way that we go about sourcing our raw material, namely our hardwoods for the toys. We ensure that they’re coming from sustainable sources that are actually certified as being sustainable by an international nonprofit organization. It means that over time, the forests here are not being depleted by the activity of the woodcutters, but instead are being harvested in a selective way in a sustainable rate. So that’s, that’s a very clear decision we would make how we could possibly achieve, maybe a slightly lower price on the wood if we were less, if we were indiscriminate about, about who we purchase from and what their harvesting methods were. But that’s a very clear social purpose for us and an important one. I think where it’s a little more nuanced is when it comes to how do you employ people, how do you treat your workers? And, you know,  you can pay the same wages as another factory. But your workers can have a very different experience working for you versus another company. And really what we’re seeking with Tegu is that not only is it a job where you come, you spend your time doing an activity and you pull a paycheck, but actually that there’s a greater sense of purpose being gained. And there’s true upward mobility over time. And this is where I think Tegu sets itself apart from the average Honduran business. My experience in Honduran and in the Honduran economy has been that businesses here tend to be focused on extracting wealth or generating wealth for their owners by whatever means possible. And what that generally means is that there’s not a real focus on, okay, how do we make sure that the people working for us over time are gaining not just professional experience, but actually gaining an increased quality of life for themselves and their families and increasing levels of responsibility and accountability and the privileges that go with that. And I think that’s really a differentiator for us. And I would say it’s still early days. You know, we’re only a couple years in. We haven’t had a huge opportunity yet to promote people, but we’re cultivating people who come in even as entry level operators so that one day. If they perform well and if they show the dedication to their jobs that is required, they’re going to move up to the level of supervisor and eventually to like a management position. And that’s really exciting because that’s when you start to see people go from what is a very low level of income and true poverty to actually creating a new future for themselves and for the families.

Sandra Morgan [00:21:16] I think we’ll need to talk to you again in a couple of years and see where you are on reaching those goals. Wow. I’m struck by how way back to the roots that you’ve gone, literally, even with the environment, and demonstrating that same kind of concern for the sustainability of the environment. And the same kind of concern and attention to the sustainability of the workforce. So that these jobs are not jobs that are part of somebodies’ bright idea to come in, employ people to stop human trafficking, but that they will go way beyond that to building a business that when Cindy and Chris decide they want to move, there is a well-trained staff to operate that factory, and it continues to be supported not just financially by the business, but by the will of the community.

Cindy Haughey [00:22:19] What’s interesting, too, Sandie, that we’ve been able to see in working with our employees when we Chris have said that we had increased and then decrease the number of employees that we’ve had in terms of. And so in the sense of wanting to teach them about this mission and the vision that we’re a part of. So Chris actually took a day and taking them out to see the trash jumpsuits in the city as well as taking them to the school that we support, which is called AFE, which is Amor Fe y Esperanza. And it was really neat to see our employees get to see that opportunity to invest in their own city and their own culture. And as a result of that trip, we had employees come back and ask us, how can we help? Can we donate food? Somebody even said, can we take the kids home with us?

Sandra Morgan [00:23:10] Wow.

Cindy Haughey [00:23:13] So it’s really neat to start to see them touch that vision of how can I also help those who are less fortunate than I am. So that’s been exciting for us.

Sandra Morgan [00:23:23] Because there are people who don’t have a job like Carla and Stephanie who are at risk for being lured into very difficult and risky situations like their cousin.

Chris Haughey [00:23:37] Absolutely. You know, I mean, look, I would love, Sandie, for Tegu to be able to employ a thousand people already, and that would be awesome. And we’ll get there someday, I believe, maybe even sooner than we think. The key for us is we really believe in creating something that’s a long-term sustainable business, which means that just as you said, you know, if we need to go somewhere else or whatever, this business doesn’t depend on donations. It really is generated, you know, the market is generating the social impact and the employment rather than donors, foundations, churches. Really, we’re looking to consumers to fuel this engine.

Sandra Morgan [00:24:27] Well, we’re excited. We’re going to put a link to Tegu.com on the podcast notes here, and we’ll also put a link on the GCWJ.vanguard.edu, because we want to keep an eye on you. See what you’re doing, see how you grow, hear your stories, and continue to collaborate. We hope to see Cindy home here and hopefully, she can join us for the conference in March 2nd and 3rd. What you’re doing is definitely a part of Women, Education, and Justice. So, Cindy, I’m going to save a place at the table for you.

Cindy Haughey [00:25:07] Thank you.

Dave Stachowiak [00:25:08] And I just like to say that both of you are just a great example of, I think, this concept of business as a mission. And I mentioned that, Sandie, because I think for a lot of us and even some of our listeners, that there’s this perception that if you want to help out and make the world a better place, that there are some ways to do that as far as going in and working in nonprofit organizations and working for, you know, shelters and things that are wonderful, wonderful ways to help out the world. But I think that there’s a perception amongst many people and in some of today’s young people and even the students at Vanguard that somehow going into the business world is a more selfish or lesser way to help out the world. And I know some of you, the listeners know my wife Bonnie is a professor at Vanguard and we both are huge believers in this business as a mission concept. And, you know, Chris and Cindy are just a great example of how good strong business skills in utilizing a business the right way can be just as impactful, if not more so, in really impacting social change and being able to do it in incredible ways. And business has a tremendous opportunity to be able to add value to the world and to affect change. And so I just acknowledge both of you for your tremendous courage in doing that, of being great social leaders, but also great business leaders at the same time. What an amazing combination of skill.

Sandra Morgan [00:26:44] So we have about two minutes, and I just want to hear from you. What do you want to leave our listeners with so that they can better understand their role in the big picture?

Chris Haughey [00:27:00] Yeah. Well, I would encourage your listeners, just as Dave was saying, to think carefully about how to maximize their skills and talents for serving others, for serving God. You know, when I was a business consultant I was sort of looking around thinking, OK, what do I want to dedicate my life to? I knew that consulting wouldn’t be my long-term career, but I was hoping to use that training and that background to leapfrog into something with a deep impact. And I would just encourage everyone who’s listening to think critically about that, no matter what stage in life you’re at. Because we very firmly believe God has given each of us talents that he’s calling us and encouraging us to use to build his kingdom and to benefit others. And I certainly get really excited about others catching this vision, that business, for-profit business can truly generate an outsized social impact and have a, make a serious dent in issues like human trafficking and so forth. So that would be my encouragement and we would love for others to support what we’re doing at Tegu. Our toys make awesome birthday gifts and Christmas gifts. If there’s a special kid in your life, it’s a great way to support what we’re doing. But we also want to encourage people to think about ways that they can dedicate their career, their talents, their time to something similar.

Sandra Morgan [00:28:32] And Cindy, 30 seconds for you.

Cindy Haughey [00:28:35] Well, it’s funny that Dave mentioned that consumption that we all have, that, you know, it’s on the nonprofit world that makes a difference because I personally have come out of that nonprofit world for much of my background and my experience and being in full-time ministry. And so coming down here has been a real dichotomy for me of being torn of, well am I really doing that work that matters? And so just like you said, the advice to listeners would be to just look at your surroundings and you’ll always find need and they can combine with your guests and your talents. And so I will admit it’s been quite a journey for me and finding what that is and especially in a different language that I’m not used to. But I have really started to find that niche in terms of leading people spiritually in the place that I’m at and continuing to get them to capture the vision as well. So just continuing to talk about what you’re passionate about, you’ll eventually be able to combine your needs with your talents, or the needs that are out there along with your talents, and seeing a different segment.

Sandra Morgan [00:29:35] Thank you both so much. This has been very energizing and we look forward to our next podcast. I do want to let you know you can find more information at GCWJ.vanguard.edu. We are also going to be on a national WebEx from Health and Human Services on September 14th. And you can get that information at our website as well.

Dave Stachowiak [00:30:00] Sandie, it’s been a pleasure to talk with you again. And we wish all the best to Chris and Cindy. And just a reminder, we’re going to put a link to their website, Tegu.com, T-E-G-U.com on the Global Center for Women in Justice page and as well as in the show notes. And we will see you again in two weeks. Thanks, everybody.

Sandra Morgan [00:30:20] Bye.

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