7 Tips for a Social Entrepreneur

Fred Keller, founder and CEO of West Michigan plastics manufacturer Cascade Engineering, keeps a card in his pocket with a set of reminders from John Wesley, 18th century Methodist theologian, on conducting a good life. Keller, who is an active Methodist, says his religious practice grounds his business activities. “It’s a matter of being grounded in principles and carrying them out,” Keller says.

Adam Lowry, co-founder of home and personal care products manufacturer Method, has pushed his company to find new ways to be eco-friendly since it became the first benefit corporation in 2007. The company’s green products are sold in recyclable plastic packaging. Similarly, Norwood Marble & Granite, a Brentwood, Md. stone and tile fabrication and installation company, recycled only a small percentage of the millions of gallons of water it used when the company was starting out. After failing its first attempt to become a benefit corporation, the company made some changes, and now recycles 98 percent of its water waste.

When Dave Eggers, author of A Heartbreaking Work of Staggering Genius as well as other titles, and Ninive Calegari, long-time public school teacher, joined up to found 826 National. The organization works with children, many of them from low-income areas, to develop a love of reading and writing. But the founders ran into a problem. The storefront they’d found in San Francisco’s Mission District was zoned exclusively for retail. So Eggers and Calegari decided they’d sell some pirate supplies in the same space in which they hosted creative writing classes. Now, elementary school-aged children take writing classes next to racks of eye patches and anti-scurvy medication.

SightLife now has 96 employees and $14 million in annual revenue. The non-profit eye bank based in Seattle supplies 5,000 corneas a year. Or they do now, thanks in large part to CEO Monty Montoya. When Montoya arrived in 1997, SightLife was called the Lions Eye Bank, and it was struggling. “We realized that if we didn’t start operating like a business, we were going to go out of business,” Montoya says. He set out to increase efficiency, hired trained technicians, and ditched the old name. He brought former Starbucks executive Tim Schottman on board. When SightLife’s efficiency landed them with more corneas than they could find recipients, Montoya expanded the country’s reach to the developing world.

EcoScraps was founded in 2010 when three Brigham Young University classmates decided to put the decomposing contents of Provo, Utah garbage cans to good use. Now, their company’s eight full-time and fourteen part-time employees collect 20 tons of food waste a day from more than 70 locations across Utah and Arizona and turn it into rich compost. The company isn’t yet producing enough compost per day to sell to major home and garden outlets like Home Depot, but they hope to soon. Brandon Sargent, one of the co-founders, said he’s an entrepreneur first and an environmental do-gooder second: “The trouble with nonprofits is that they can only do as much good as they can before their funds run out.”

Like a Girl Scout, that is. The Girl Scouts of America are one of the best and longest-functioning examples of a nonprofit that generates earned income. The organization began selling cookies as a fundraising technique in 1917, five years after they were founded. Their 3.3 million members now generate revenues of $700 million a year. The model works for companies whose workforce doesn’t have a high percentage of pigtails, too. A company called Living Goods has perfected a system of microfranchising whereby the San Francisco-based nonprofit sells health products at rates radically below the market to rural Ugandans, who then sell them at a profit. The medicine reaches those who need it at a reduced rate.

Scott Harrison, founder of charity: water, a nonprofit that provides clean water sources to underserved areas, had an epiphany on a beach in Uruguay when he was 28. When he got home to New York City, Harrison met a friend at a bar to tell him about his plans to ditch the high life and dedicate himself to social causes. When the friend bought Harrison a $16 margarita, the convert to social issues began to rant with zeal on how much food that money could have bought a family in the developing world. Now, Harrison says he focuses on telling people about the good done by the money they do give. “If these people are willing to spend $16 on a drink, wait until they hear the stories of what is possible,” Harrison told Inc. “I believed it hadn’t been told in the right way to capture their imagination.”