How a Business Can Change the World
Start a company. Change the world.
It used to be that if you wanted to make a difference, you joined a nonprofit. And if you wanted to make money, you launched a business. These days, it's not so simple. More nonprofits are being run like fast-growth start-ups. And more traditional companies are being built around social missions.
In the pages that follow, we shine a light on this new universe of social entrepreneurship. First, we meet Fred Keller, the founder of Cascade Engineering, a $250 million Michigan plastics manufacturer, who recently turned his business into a B Corporation, the highest standard for socially responsible businesses. Then we investigate five more business models—and meet the entrepreneurs who have adopted them.
Social Entrepreneur Profiles
As the founder and CEO of a West Michigan plastics manufacturer employing a thousand people, Fred Keller lives by rules. There are those he must follow, passed down by big-letter entities such as OSHA, the DOL, and the EPA. There are others—like ISO, the voluntary international certification of quality management—that he and other manufacturers follow. And there are still others that a much smaller but growing group of companies heeds—LEED green-building standards and B Corporation guidelines of social and environmental responsibility. Read More
Dave Eggers and Ninive Calegari, the co-founders of 826 National, thought they had found the perfect spot for their drop-in writing center. There was just one problem: The storefront space on Valencia Street in San Francisco's Mission District was zoned exclusively for retail. So Eggers, the celebrated writer, and Calegari, a veteran public-school teacher, got creative. They opened their tutoring center—inside a pirate supply store. Read More
SightLife, a Seattle-based nonprofit eye bank that extracts corneas from organ donors and distributes them to transplant centers around the world, is one of the largest such facilities in the U.S., with 96 employees and more than $14 million in annual revenue. It supplies nearly 5,000 corneas for transplant a year. But it wasn't always that way. Read More
Brenda Palms Barber, Chicago's Queen of Second Chances, is dedicated to finding jobs for former prison inmates. But when the nonprofit she runs couldn't overcome employers' resistance to bringing on ex-offenders, she spun out a business so she could hire them herself. Read More
Here's one way to explain sticker shock in the organic produce aisle. Consumer demand for organic products has grown at a double-digit rate every year for more than a decade, according to the United States Department of Agriculture. And the portion of U.S. farmland that is certified organic: 0.6 percent. Read More
Magleby's Fresh, a Provo, Utah, restaurant, is famous among students at Brigham Young University for its all-you-can-eat breakfast buffet. It was there in 2009 that Dan Blake first took notice of the staggering amount of food that ended up in the restaurant's garbage cans. Then a junior studying English and business at BYU, Blake began pondering the business opportunities. If your cost of raw materials was nothing, he thought, that would make for fantastic margins. Read More
Social Entrepreneurship Business Models
The Social Entrepreneurship Spectrum: B Corporations
To become B Corps, businesses must prove that they care as much about society and the environment as they do about profits. Read More
The Social Entrepreneurship Spectrum: Nonprofits
Nonprofits are fueled by tax-deductible donations—cash from individuals, public grant funding, or money from foundations. As of 2010, nearly 1.3 million 501(c)(3) organizations were registered with the IRS; they raise more than $300 billion in charitable donations a year. Read More
The Social Entrepreneurship Spectrum: Nonprofits With Earned Income
A 501(c)(3) nonprofit can still generate earned income. And plenty do. The National Center for Charitable Statistics estimates that nearly 70 percent of the $1.4 trillion generated by nonprofits in 2008 came from the sale of goods and services. Read More
The Social Entrepreneurship Spectrum: Hybrids
In the hybrid model, a nonprofit and a for-profit are linked. In some cases, one is a subsidiary of the other; in others, the two entities are bound by long-term contracts in which one entity fulfills a basic need for the other and vice versa. Read More
The Social Entrepreneurship Spectrum: Impact Investors
All investors obsess about returns. But for impact investors, ROI is an especially tricky matter, because in addition to financial success, they are seeking social and environmental results. Read More
The Social Entrepreneurship Spectrum: For-Profits With a Social Mission
For some businesses, social impact can be measured by the size of the checks they write. For others, the mission is woven directly into the business. Read More
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