Manny Padda, president of the Entrepreneurs' Organization (EO) Vancouver chapter and 2016 EO Global Citizen of the Year, is founder and managing director of New Avenue Capital. Manny's personal mission is to educate 1 million young people in his lifetime. We asked the philanthropic serial entrepreneur about ways that startups can start giving back. Here's what he shared:
When I first started my executive search firm, I was already doing something a little unusual: Giving away my services for free. Colleagues and friends would come to me looking for job opportunities in a particular industry, so I'd take an hour to review their resumes and discuss their career aspirations. At a moment when I should've been spending every minute hustling to build my company, I couldn't say no.
Luckily, sharing my time turned out to be a savvy (if unplanned) career move. Without realizing it, I was giving back--doing a little ad-hoc corporate social responsibility (CSR) even before my own business fully took flight.
We often think of CSR as philanthropic efforts or charitable foundations that only substantial, established companies can afford. Startups, especially new ones, generally have far more burning priorities--hiring the right people, finding customers and figuring out budgets and QuickBooks.
But it turns out that giving back right out of the gate can be a powerful technique to accelerate growth and build your culture--if you do it right.
The business case for giving back
I don't believe any business should have to give back--not even if you've got the bank account of Jeff Bezos. It's got to come from the right place. It's about wanting to help people, first and foremost; the business benefits are secondary.
Having said that, there are real upsides, especially for early-stage businesses. CSR can be a powerful differentiator: 87 percent of US consumers will buy from a company because it advocated for an issue they care about.
Likewise, studies show companies with a clear CSR policy produce happier, more creative, engaged employees who stick around. It's also a key component in attracting great team members. More than 70 percent of Millennials and Gen Zers seek jobs where they can make an impact, and prefer companies that are about more than the bottom line.
CSR makes a difference when attracting values-aligned investors, too. Recently, the founder of an organic food and wellness line emailed me. After explaining her business model, she mentioned that she donates products to benefit women in India and gave her first $2,000 in profits to a girls' orphanage (coincidentally, in the city where my mom was born). Besides the fact that her company was doing interesting things, her personal causes resonated deeply with me--I set up a meeting right away.
The "Three Ts" of giving back
To be clear: I don't think early-stage startups should be donating heaps of money. That could signal investors that there's excess capital on the table. But there are other key resources almost any startup can offer:
1. Time: Being generous with your time--and encouraging employees to do the same--is an accessible way to start giving back.
For entrepreneurs, sharing mentorship and advice is an easy and rewarding way to pay it forward. One of the youngest entrepreneurs I work with, the 21-year-old founder of an influencer relations platform, shares insights on social media and entrepreneurship freely with anyone who asks. It's probably no coincidence that he also boasts a professional and investor network far beyond his years.
As your business grows, this spirit can extend to incentivizing employees to donate their time. My investment firm rewards employees who volunteer with additional personal days and regularly schedules team-building activities that give back-- from collecting donations to supporting local food pantries. These activities bond employees together and build morale, which has the bonus of boosting productivity when it's time to get back to work.
2. Talent: Your talent is the unique service, product or skill set that you and your company bring to the world. Offering that talent to charities or non-profits--either free or at cost--makes sense for startups interested in giving back. After all, your own product is readily available, and hard costs are often modest.
Instead of donating money, for example, I'll often perform executive searches free of charge for charities seeking new leaders. TOMS Shoes shares its resources in a more tangible form, giving a pair of its shoes to kids in need for every pair sold. Meanwhile, my partner donates her professional etiquette training platform to help teens at Covenant House prep for job interviews.
Everyone's got something to give, but even if you can't help directly, maybe you know someone who can. Your network is a big part of your "talent;" sometimes connecting someone in need with the right person can be the greatest gift.
3. Treasure: While big corporations collectively donate $20 billion a year to charitable causes, financial gifts are the last resource a startup should donate until its business becomes sustainable.
However, when that time comes, focus is essential. Just like your company has a mission statement, so should its philanthropic efforts. How much do you plan to give, and what kind of impact do you want to make? Which causes will you support--and why? Being clear and specific about your intentions is a chance to signal your values to the world, as well as to hone in on a goal in a world full of worthy causes.
My personal mission is to help educate one million children in my lifetime, and I make that known: I've written it down, I tell everyone I meet, and I get involved with projects (like fundraising for the new Science World Wonder Gallery) that contribute to that goal. This way, I'm accountable, and it's easier to say no to asks that don't align. I obviously can't help every cause, but by setting parameters, I maximize the impact of the help I can give.
Done right, CSR is the rarest of things in business: a win-win. Startups can serve their community while strengthening growth and viability. The good news is, you don't have to wait until you're a Fortune 500 company to make it happen. Anyone can start tapping into the "three Ts" of giving back and begin paying it forward from day one.