Lobbying Revisited

It's been a while since I wrote about lobbying. I moderated a panel on lobbying in the tech industry at this year's Corporate Affairs Forum and recently, I also conducted a workshop on lobbying for a group of international MBA students visiting Singapore. These 2 recent experiences got me thinking... or I should say, revisiting what I thought I knew about lobbying.

WHAT IS LOBBYING?

Let’s get some alignment on what is and what is not lobbying. One definition which I like a lot defines “lobbying” as a form of advocacy with the intention of influencing decisions made by the government. The origin of the word “lobbying” is actually very interesting. Apparently, in the early days of the UK Parliament, members of the public would hang around the lobbies of the House of Commons to catch hold of members of parliament between sessions where they could plead their cases.

I have not personally tried to intercept any members of parliament in the lobbies of any parliamentary building. But, I have ambushed and trailed many government officials in public venues to plead my cases. Guess lobbying in a hotel lobby also counts as lobbying.

IT IS NOT JUST CONNECTIONS… NOR WINING & DINING

What lobbying is NOT is people selling their connections to government officials. It is also NOT having expensive dinners and drinks with supposed decision-makers. If you ever come across anyone who tells you they can help you because they are connected to so-and-so, run away. If you ever get asked to host an expensive dinner with a government official because “that is how we do things here”, run away.

Lobbying is advocacy. And it has to be backed by hard data. It is not some kind of black arts where things happen behind closed doors, under the tables or in black boxes.

WHO ARE THE LOBBYISTS?

You have probably come across people with job titles like “Government Relations”, “Corporate Affairs”, “Public Policy”, “Public Affairs” or “External Affairs”. They are all lobbyists. They could be working in an advisory firm or in a big corporation in-house department. As you can see from my LinkedIn profile, I have done both. Even now, a lot of my advisory projects for startups involve some element of lobbying.

You may also come across people who are working at some think tanks, policy research institutes, industry associations or trade chambers. If they are regularly and publicly expressing some points of view, chances are they are also lobbying on behalf of somebody. Some times we can find out who is behind them, but some times it is not so apparent. But, I consider them lobbyists too.

Good. Now that we have gotten the definition out of the way, let’s look at how we do lobbying.

LOBBYING REVISITED

When I left eBay in 2014, I wrote several blog-posts on the topic of lobbying. You can find my blog-posts on LinkedIn and Medium. As I wrote earlier in this post, I recently re-read these blog-posts and I realise that a lot has changed since then. 

The biggest change is that we are now living in a world where there is a huge trust deficit. We simply do not have that much trust in the political and business elites any more. And in many instances, we have seen very bad behaviours from them. So, it is no surprise there is a trust deficit. How then do we go about lobbying in this new environment? Are those government relations or lobbying tools I have written about in 2014 still useful? My short answer is, “Yes, they are still useful.” If you have the time, I recommend you take a look at my earlier posts as I have listed down all the tools of our trade. 

I don’t propose to go through all of them today. Instead, I want to run through 2 case studies with you to showcase some of these tools being applied in this new low-trust environment.

WALK THE TALK!

The first thing I want to call out is a Chinese saying that goes something like this, “听其言, 观其行” which can be loosely translated to mean, "Judge a person not by his words but by his actions." I like to think of it as, "Are you walking the talk? Or are you just talking a good talk?" 

As we enter a new market, launch a new product or even start a new company, chances are we will run up against some existing laws or government policies that will stand in our ways. Or our particular business model or product just do not fit into any existing laws or policies. We see this kind of situation a lot in the tech startup world. How do we then go about convincing the government to see things our way?

That was my challenge when I co-founded Cosmic Cafe in Japan back in 2016.

COSMIC CAFE LAUNCH

In 2016, I decided to move to Fukuoka to launch a startup investment and advisory firm (You can also find a few posts I have written about my adventures moving to Fukuoka on my LinkedIn page). When my co-founder and I presented our business plan to the government officials in Fukuoka, they told us it was the first time they have seen such a business plan. 

Under their business registration framework, there are existing categories for “fund management” or “consulting” but not something which is trying to do both. They also have venture capital firms registered in Fukuoka. But, they have not encountered any private investment fund focused on startup investments.

That was when we realised we might have a problem on our hands. We needed their approvals in order to secure the entrepreneur visas that will allow us to live and work in Fukuoka. We were advised by our lawyers that we should consider returning to Singapore to wait for the outcome. We chose to ignore our lawyers’ advice. Instead, we decided that since we have 3 months’ worth of visa-free stay in Japan, we would stay in Fukuoka and spend the time lobbying to secure our work visas.

IT’S A CAMPAIGN

In a sense, lobbying is no different from a candidate campaigning for public office. You may be wondering - “I am not a politician, I don’t know how to run a political campaign.” But, you surely know how to run a marketing campaign. It’s the same thing. Running a lobbying campaign all boils down to knowing your company really well, figuring out your unique selling point, identifying the right audience and then telling your story well. You also have to tell your story over and over again to as many people as possible.

We intended Cosmic Cafe to be a private investment and advisory firm focused on technology startups. We found out from our research that Fukuoka City Hall wants to be the Startup City for Japan. At that time, there were only a handful of early-stage startups in Fukuoka. It was a very nascent startup ecosystem with huge ambitions. So, we knew if we presented ourselves as a responsible player that will help grow the ecosystem, there is no way we would not get our visas.

We started to spend a lot of time at the co-working space run by the local government to get to know the local startup community. We spoke to a lot of startup entrepreneurs. We started providing free mentorship and advice to some of them who were also camping out at the co-working space. We participated in the startup events organised by the local government. We even started taking pitch meetings from entrepreneurs. 

And throughout the whole time we were engaging with the local community, we kept up our regular meetings with Fukuoka City Hall, the Japan External Trade Relations Organisation and Japan Immigration to keep them informed of our efforts. Our actions in supporting the local startup community turned out to be just the thing that showed the Japanese officials we are trust-worthy business people.

Our strategy was to be absolutely consistent in what we say and what we do in Fukuoka. The story that we told everyone - over and over again - was that we were here to be part of the Fukuoka startup community. And we backed up those words with our actions by spending close to 3 full months mentoring entrepreneurs, meeting with other VCs, conducting workshops for entrepreneurs, taking pitch meetings and even blogging about Fukuoka as a great place to launch your startup.

We eventually secured the approvals for our entrepreneur visas to live and work in Fukuoka. Even after securing our visas, we continue to maintain good relationships with both government organisations.

So, the few things I would like you to take away from this first case study is that lobbying is not something that you hand off to your government relations department or lawyers to do for you. As the CEO of your companies or the leader in your organisation, it should be your job to take the lead in lobbying. It should be part and parcel of your core business plans and activities.

Your actions must be aligned with your words. You must walk the talk as action speaks louder than words. And you must invest the time and efforts to engage your stakeholders over a sustained period of time. There are no “quick wins” in lobbying. It takes time and multiple meetings to find the win-win. You need to give your government audience the time to get to know you, to start to believe in you and then to trust you. Then, and only then can you hope to influence them to make a decision in your favour.

WORK WITH ME

I want to share with you another case study from Japan. I am not involved in that project but have read about it in the press when I was living in Fukuoka. This case study demonstrates the importance of leveraging on your unique business model or product as a lobbying platform.

Airbnb has enjoyed great success in Japan since their launch in 2013. They rode the waves of international tourists who were flocking to Japan around the same time. Over the more than 2 decades of deflation, Japan has not been adding enough hotel rooms and was unable to cope with this sudden increase of inbound tourists. As a result, a lot of tourists were booking private homes on Airbnb when they visited Japan. The sudden influx of foreign tourists into neighbourhoods which are traditionally residential led to a backlash. Naturally, the Japanese government was forced to take action. This was around 2016 when there were plenty of talks in the media that the Japanese government was going to put in place laws to ban short-term rentals of private homes.

BE THE SOLUTION, NOT THE PROBLEM

Airbnb in all likelihood did all the usual stuffs we do in the lobbying industry. They would have reached out to the various government officials in the different ministries to present their case. For example, they must have spoken with the tourism ministry to try to show them that Japan needs more hotel rooms but are not building them fast enough. They would have most probably reached out to the Japanese police to try to convince them that Airbnb has in place a lot of safety and security measures to ensure that neighbourhoods would not suffer from higher crimes because of an influx of foreigners. And it would not have surprised me if Airbnb has also spoken with the land management authorities to argue that short-term rental actually helped to lift property price which has been in steady decline for 20 years. 

All the usual stuffs. But they also did something very creative.

Airbnb launched a small community project in the tiny village of Yoshino in the Nara Prefecture. Yoshino village was dying. Like thousands of other villages in Japan, the population is ageing, the traditional industries are disappearing and the younger people are fleeing for the big cities where there are more jobs. 

Yoshino does have something going for it, a beautiful mountain that turns totally pink when 30,000 cherry blossoms trees bloom every Spring. Travellers, both domestic and foreign, flock to Yoshino to see the cherry blossoms but most of them will just do a day-trip and leave. Yoshino did not manage to capture a lot of the travellers’ money because they did not have many holiday accommodation in the village. Airbnb worked with the villagers to design a building which would hopefully revitalise the village. They called it the Yoshino Cedar House as it was build with the cedar wood found in the forests around Yoshino.

The Yoshino Cedar House has a community space on the ground floor and 2 bedrooms on the 1st floor. These 2 bedrooms were listed on Airbnb. Some of the villagers decided to form a co-operative to jointly run the short-term lodging business and also operate a cafe out of the community space. 

In its first year of operation back in 2017, Yoshino Cedar House hosted a total of 346 guests taking in close to USD25,000 worth of revenues for the village. The cafe also made some USD2,814 from selling breakfasts and coffee to the guests and villagers.

More importantly, these 346 guests who stayed at least a night at Yoshino were spending more money in the village - buying souvenirs, taking guided tours, wining and dining - so much so that the village reported that 70 new jobs were created as a result of the Yoshino Cedar House project. Another not surprising outcome is that Yoshino village now has 15 home listings on Airbnb compared to just 4 listings when the Yoshino Cedar House started operating.

Needless to say, Airbnb launched an aggressive communication campaign to highlight the success of this community project. They talked about how short-term rental not only brought new revenues to the people running the property, but created new jobs for the entire community. They highlighted how short-term rental could be created quickly to capture the sudden increase in tourists but could serve other purposes during tourist low seasons - something that a hotel cannot do. And most importantly, Airbnb talked about how Yoshino Cedar House is revitalising a dying village.

In 2018, Japan passed their short-term rental law. It was not a complete ban. Instead, the law explicitly allows for short-term rental subject to some conditions. It is a win for Airbnb on the lobbying front. Did this community project and its related communication campaign help? I would think so. Until then, all the news about short-term rentals or Airbnb were about the negative impacts they brought to any community. For the first time, there was a different narrative where the Japanese could see how short-term rental could revitalise a dying neighbourhood and bring sustainable tourism to it.

TRUST ME!

I hope that these 2 case studies have shown you that lobbying is not some black art. Instead, I believe lobbying should be core to any business plan and form an integral part of your business activities.

When we are operating in this new low trust environment, it is not enough to say, “Trust me!" and expect our stakeholders to say "Sure thing." 

Before we can push any agenda on our government stakeholders, we need to build trust. We need to dig deeper and find common grounds between our company's goals and those of our government stakeholders. 

Walking the talk is a good place to start. Making a genuine effort to work with the community is also critical. Finally, being able to do this in a sustained manner will bring you success.

If you can just do these few simple things, I think lobbying is going to be something that you will do very well and enjoy very much.