Big Ideas: J. Gregory Dees makes the case for social entrepreneurship

Originally posted July 14th at dowser.org
Contributor:  Julian Brookes

Starting today, we're going to check in regularly with big thinkers in the field of social innovation. We want to know what they're working on, what questions they're wrestling with, and what opportunities and challenges they see up ahead for the sector.

First up, J. Gregory Dees—professor at Duke's Fuqua School of Business, director of the school's Center for the Advancement of Social Entrepreneurship, and often referred to as the "father of social entrepreneurship education." He's the coauthor and editor of several books on social innovation, and he's at work on another, due out next spring. Read on for highlights from our conversation.

On why social entrepreneurship is essential for solving social problems: "Social and environmental problems tend to be shifting and complex. To solve them you need context-specific knowledge—as well as creativity and motivation—which is scattered among private citizens. Social entrepreneurship allows us to tap into that."

On government's limitations as a problem-solver: "We don't know in advance what's going to work, which solutions are going to be most cost-effective, which are going to work best in which circumstances. The only way to know that is by have lots of different experiments going on, and that's something governments are ill-equipped to do."

On businesses' limitations: "Many of the large firms that make up our markets are investor-owned and have a responsibility to deliver profits to their investors. But most of the experiments to find solutions to social problems are not going to meet that financial threshold, and that's where we need social entrepreneurship—to fill the gap."

On his current project: "I'm writing a book that argues that social entrepreneurship is just as important to the health of society as business entrepreneurship is for the health of the economy. It's for anybody interested in helping create a healthy environment for social entrepreneurship—and that includes policy makers, funders, educators, and citizens."

On the need (still) to make the case for social entrepreneurship: Those of us in the field may not realize it, but there are still a lot of folks out there who see social entrepreneurship as nice but not that significant, maybe even as a passing fad. And a related worry I have is that, as new as the concept is, it's old for some folks, and they're looking for the new, new thing—something else, like, say, impact investing. We still have a case to make for why social entrepreneurship is essential."

On social entrepreneurship's Catch-22: "If people assume that social entrepreneurship is marginal, that it doesn't really scale, then they don't make the effort to do the policy changes to get large-scale successes. In other words, they're not going to invest in the ecosytem to support them. And that's a problem. We're going to need the ecosystem if we're going to have large-scale successes to point to. It's a bit of a Catch-22."

On the ecosystem for business entrepreneurship (a telling contrast): "How many businesses would start from scratch and go to scale if we didn't have venture capital? If we didn't have banking and financial infrastructure to support business growth? If we didn't have business schools? We have a very elaborate support structure for business entrepreneurs. How well would they do without it? My guess is not so well. Without something similar for social entrepreneurship, we can't expect to see the same kind of scaling and impact."

On the need for better ways to measure social impact: "We badly need greater clarity and transparency in performance evaluation and assessment. That would give skeptics confidence that we're achieving the impact we're claiming to achieve. But that's a small piece of a larger puzzle. We need improved legal structures, better financial mechanisms, better pipelines for talent, and more directed education and training. We need all of that, and a culture that understands social entrepreneurship and supports it."

On the idea that the U.S. lags behind other countries in social entrepreneurship: "I don't know how to do those comparisons. We're talking about very different contexts, very different social problems and needs. There are some very exciting things going on outside the U.S., and to some extent the pressing needs in other places may open the door to new kinds of innovation, like the use of cell phone technology to solve problems related to rural poverty and to link it to microfinance. But there's a lot of creative, exciting stuff going on in the U.S."

Thanks again to dowser.org for this contribution

Photo: Nathan

My Journey to Launch

I'm thrilled to have launched TheChange and to see my vision of advancing the sustainability movement locally coming to life with the help of a great team and community support. One-month post launch, I thought I’d take the time to reflect on my journey to date.

I grew up on the West Coast of BC and was raised to be environmentally conscious and socially active. I’ve always been interested in getting involved with organizations that are built to make the world better. They are why I wake up in the morning, and the inspiration for the kind of company I hope to create.

In late 2007, I came up with the concept for an online platform that connects people with organizations that align with their values. It started as an extension of my personal interests, and then became a business opportunity when I noticed the demand increasing for corporate responsibility, green jobs and eco-friendly products/services.

I didn’t have a technical background, but I saw the web as the perfect medium to get people informed and inspired to participate in the green economy. Ultimately, I saw the web as a tool to power offline action.

With this business concept in mind, I enrolled in the Bachelor of Commerce program with a specialization in Entrepreneurship at Royal Roads University. The program allowed me to work on a business plan and participate in a start-up incubator. I graduated top of class and with $25,000 in awards. I used this money to incorporate Ethico Solutions Inc. in the fall of 2008.

I spent the next year researching, networking and understanding my customer’s needs. I managed the administration and marketing for the Victoria Values-Based Business Network and Organic Islands, Canada’s largest outdoor green expo. I attended the Social Venture Institute and Web of Change Conference. These experiences gave me to the opportunity to build relationships with many small and medium sized businesses (SMEs) in the local sustainability space.

I learned that SME's primary challenges were in marketing, sales and recruitment. After hearing their stories and learning how they put sustainability into practice, I was always inspired to support them as a customer, employee or volunteer. So their story - what inspired them to go green and their sustainability initiatives, as they related to the environment, community and employees - became the focus of how I would profile these businesses online. I recruited a technical partner in the Fall of 2009 and for the next six months we worked together, along with designers, branding and legal professionals to release the first version of the platform known as TheChange.  

TheChange launched in Vancouver and Victoria May 15^th 2010 and aims to connect people with local sustainable businesses in a relevant and engaging way.  Now one-month post launch, TheChange has been featured on the front pages of local media, raised money, hired two employees, recruited a CTO, and is even working with marketing interns from my old stomping ground at BCIT! We have over 50 organizations onboard, are growing daily, and are working diligently on version 2.0 of the platform based on our beta testing and customer feedback.

We’re also gearing up to launch a new initiative called ethicalDeal this July! Every day, ethicalDeal will offer one exclusive deal on eco-friendly products and services in your city at an unbeatable price. This is another way we are helping people participate in the green economy and are supporting local businesses that offer green products/services.

We’re moving into an office this summer and will be hiring people to help us grow on a city-by-city basis across North America. I’m very excited for what lies ahead and truly believe that together we can advance the sustainability movement. Join us in TheChange!

Yours for a sustainable future,

Annalea Krebs

Founder & CEO, Ethico Solutions Inc.

www.TheChange.com

www.ethicalDeal.com

A people-centred economy: Reflections from the Summit

Raj Patel was both charming and self-deprecating as he took the stage at the National Summit for a People-Centred Economy in Ottawa last Sunday night. Briefly addressing the crowd of about 200 in French, he apologized for his "accent incomprehensible," before continuing his keynote address in English. Once he made the switch, even those French speakers wearing translation headsets had no trouble understanding his message.

Pulling largely from his New York Times bestseller, The Value of Nothing, Patel spoke about "the commons" and notions of private ownership versus communal property. The argument against commonly held assets is that we are a selfish and greedy species by nature so it couldn't work. This is referred to as "the tragedy of the commons," yet there is no evidence to support this. As Patel asserts, yes, we as humans are selfish and greedy, but we are also something more. We have the capacity for altruism; we have the ability to put the common good before our own. This, in essence, is what a people-centred economy is all about.

You might say Patel was preaching to the converted - those working in co-operatives, community economic development, social enterprises, social finance, social economy. They had all gathered for two days of learning and discussion around the idea of an economy centred on people rather than profit. And all the big players were there: John Anderson from the Canadian Co-operative Association, Rupert Downing from the Canadian Social Economy Hub, Tim Draimin from Social Innovation Generation and Causeway Social Finance, David LePage from Enterprising Non-Profits, Mike Lewis from the Canadian Centre for Community Renewal, Michael Toye from the Canadian CED Network, and the list goes on...and on. Pretty much everyone who is attached to this movement was there, along with lots of new faces eager to learn more about it.

And learn we did. On Monday we rolled up our sleeves and broke off into six summit workshops to discuss such issues as finance and investment solutions for social economy, enterprise development, local revitalization, the social economy marketplace, strengthening the movement, and taking it global. The conversations weren't always easy - it seems we still can't completely agree on who "belongs" in the movement and who doesn't quite make the cut - but despite our sometimes differing views, the mood was positive and there was no lack of enthusiasm about what the people-centred economy is trying to achieve: a more just, equitable and sustainable world. But don't take my word for it.

Read the draft declaration developed during the summit workshop to find out exactly what this movement stands for and where it's heading. http://www.ccednet-rcdec.ca/en/node/9495

By Nicole Zummach

Big and small lessons from IFIP

By Ruth Richardson, originally published at SmallChangeFund.org

This past weekend I attended the International Funders for Indigenous Peoples (IFIP) conference in Tofino on the west coast of British Columbia. The richness of humanity was there in all its glory. An amazing array of people attended from Borneo, Guatemala, Canada, New Zealand, Greenland, Russia, Ethiopia, Ghana, Peru, Australia, Columbia, United States, Kenya, South Africa, not to mention those who welcomed us from the Tla-o-qui-aht First Nation from in and around Tofino. We were there to discuss “Building and Sustaining Coalitions: Finding Common Ground for Education, Environment, and Human Rights Advocacy.” The depth of experience and expertise shared cannot be captured in a quick blog, but I can share a few lessons.

One: Amplify the voice of indigenous peoples. This might seem obvious coming out of a conference on indigenous peoples but the importance of it is not always obviously recognized or acted upon. Funding for indigenous peoples is on the rise but it’s still a drop in the charitable bucket. And the stats have a real face. Tara Marsden of the Headwaters Initiative in northern BC highlighted the incredible lack of capacity in indigenous organizations compared to non-indigenous NGOs, particularly environmental NGOS. And yet the imperative to support rights-based approaches, self-determination, and aboriginal responses to social and environmental challenges is evident worldwide. Harry Jonas from Natural Justice talked about the need to assert indigenous voices as rights-holders, not stakeholders, in his work in South Africa. Gloria Ushigua from Kenya argued that the best investment in advancing social and environmental justice efforts is an investment in indigenous communities and, to go one step further, in indigenous women who are often closest to the problems and closest to the solutions. Indigenous rights are an essential and inseparable part of solving the challenges of today. Women’s rights are no different. Together they could change the world.

Two: Go local. This was such a strong theme throughout the conference that I couldn’t get away from it. It followed me from session to session. It started with the first panel where Julio Cusurichi Palacios from Madre de Dios in Peru argued, “most of the best solutions are local.” Dr. Marjo Vierros of the UN University in Australia echoed this asserting that we need to find more and better ways to get money directly to communities. Linda Different Cloud, a Lakota Ethnobotanist, talked about the power of restorative ecologies and how she’s transforming her community one plant at a time through bringing back indigenous foods, such as mice beans, thereby impacting global food security and biological diversity. The arguments for local – implicit and explicit – flowed through the entire conference and were touched upon by almost every speaker.
One of the most powerful examples of this for me was a story told by Jack Woodward, an indigenous rights lawyer in BC and counsel to the Beaver Lake Cree Nation in Northern Alberta. He was approached by the Cooperators Bank in the UK that had surveyed its members on how it should direct its charitable dollars. The bank’s membership identified climate change, and then left it up to the executive committee to figure out how to effectively engage on this daunting issue. The Alberta Tar Sands won hands down, as the most polluting mega-project the globe has seen. But who to give the money to? They went local and grassroots. They gave it to the Beaver Lake Cree Nation deeming them the most worthwhile recipients; there is no better investment.

Three: Stand together. I led a session at IFIP with four incredible women from Northern Canada and Russia on indigenous communities response to natural resource extraction in the circumpolar north. Each of them talked about the importance of community unity in responding to oil and gas development, mining, and other extractive activities. Where communities are united, solutions, deals, oppositions, agreements are stronger, more effective, and longer lasting. It was an important theme in my session but I must admit I was surprised to hear this repeated over and over again no matter what the context or continent. I don’t think this is specific to indigenous communities. I believe it relates to all of our communities and any work at the grassroots level. Standing together in our efforts to protect our places, our children, our right to a healthy planet, allows us to “walk tall and powerful.”

Four: Tools are for leverage. Any one who’s used a crowbar knows this. It’s no different in the world of social change. Ginger Gibson, a Small Change Advisor and consultant to communities in North and Latin America, talked about her recent publication of The Community Toolkit for Negotiation of Impact and Benefit Agreements – agreements that have the power to shift the power imbalance and transform negotiations between indigenous communities and big industry. Harry Jonas from Natural Justice in South Africa touched upon bio-cultural community protocols like the ones used in Rajasthan supporting the people dependant on the Kumbalgargh Forest. Chief Lydia Hwitsum of the Cowichan First Nation, and Chief Al Lameman of the Beaver Lake Cree, spoke in depth about legal tools for empowerment in the context of human rights and environmental frameworks to protect their aboriginal rights, land, culture and histories.

Five: Remember our humanity. We live in an increasingly disconnected world. I was feeling it as I drove to Toronto’s airport imbedded in my iphone and trying to get a few last emails off before boarding the plane. I arrived in Tofino and was pleasantly overwhelmed with the authenticity of the dialogue, the connection between cultures and peoples, the reverence and gratitude for one another. I must admit it tripped me up since I’ve been to too many stuffy conferences. One morning the amazing Angaangaq Angakkorsuaq, Inuit healer and author of the quote above about walking tall and powerful, brought in the day with his drum, his feathers, his wisdom. He said his purpose on this earth is to melt the ice in the hearts of men. I think he succeeded a little with each of us at IFIP. Now if only we could all carry that into our work, we would be so much more effective.

This point is no less important than the ones above. To some it may sound a little “soft” but it carries with it deep resonance. As one of my favourite thinkers, the late Donella Meadows of the Sustainability Institute, wrote (no blog is complete without a reference to her wisdom and insight): “Living successfully in a world of complex systems means … expanding the horizons of caring. There are moral reasons for doing that, of course. And if moral arguments are not sufficient, then systems thinking provides the practical reasons to back up the moral ones. The real system is interconnected. No part of the human race is separate either from other human beings or from the global ecosystem. It will not be possible in this integrated world for your heart to succeed if your lungs fail, or for your company to succeed if your workers fail, or for the rich in Los Angeles to succeed if the poor in Los Angeles fail, or for Europe to succeed if Africa fails, or for the global economy to succeed if the global environment fails. As with everything else about systems, most people already know about the interconnections that make moral and practical rules turn out to be the same rules. They just have to bring themselves to believe that which they know.”

These lessons are not new, and perhaps not surprising. We know them. Now we just need to work on bringing ourselves to believe them, and live them.

Three indigenous projects that need your support on www.smallchangefund.org: Protecting our Ancestral Lands in the Peel Watershed, Yukon; Tusaqtuut: Inuit Knowledge and Climate Change; Youth Aboriginal Skill Training Program.

By Ruth Richardson, originally published at SmallChangeFund.org

Ben & Jerry's founder gives us the scoop at Venture4Change Summit

By Jennifer King, Director, Social Ventures initiative, Capacity Waterloo Region

A couple of months ago, I sat down with a young social entrepreneur who is growing a national nonprofit social venture. It was a great conversation that eventually drifted into the social venture definition debate. You know, the one that goes, “what exactly is a social venture and is it nonprofit or for-profit?” This social entrepreneur was firmly in the nonprofit camp. Profiting from a social mission was just plain wrong, he said.

This made me nervous. Our chat was just ahead of the Venture4Change summit that we at Capacity Waterloo Region were producing. The whole point of the day was to bring nonprofit and for-profit social entrepreneurs together under one roof to talk about how people with powerful ideas were changing the way business was done. I started second guessing. Would it end up being a debate about right and wrong? I had brief flashes of heated arguments with the “good” nonprofit folks lined up on one side of the room and the “bad” for-profits on the other.

Luckily, the day worked. People interested in real social change proved that they care less about terminology than they do about action. Nonprofits, for-profits, and funders found common ground. They listened, shared ideas, started conversations, and sometimes agreed to disagree. Of course, silos weren’t torn down, but little pieces of them were chipped away. Jerry Greenfield, co-founder of Ben & Jerry’s and Venture4Change’s keynote speaker, told me that he had never been to an event before with such a mixed cast of characters and passionate attendees. He was joined by two other speakers, Tony Pigott, CEO of JWT Canada and co-founder of Brandaid Project, and Sam Purdy, National Director of Habitat for Humanity’s Restores.

Tony’s message to “be different and be better” was a reminder that while socially-conscious consumers are wielding more market power than ever before, the market is very crowded and only ventures that distinguish themselves will be successful. Sam’s story of Habitat’s Restore business touched on the branding and regulatory challenges of a national venture that’s completely run by 73 affiliates – all separate charities with their own boards. Restore, a “retail business that turns donations into cash,” sells donated used building materials that provide an ongoing source of funds to fulfill Habitat’s mission.

Venture4Change wrapped with Jerry, who founded Ben & Jerry’s with Ben Cohen in 1978 after unsuccessful attempts on the career track. Friends since seventh grade, Jerry says they thought, “why don’t we get together, do something fun, be our own bosses, and since we always liked to eat quite a bit, we thought we would do something with food.”

Ben & Jerry’s didn’t set out to change the world. These hippy kids just wanted to have a good time. They knew absolutely nothing about the ice cream business, but a five dollar correspondence course taught them enough to set up shop. But a funny thing happened on the way to the ice cream parlour. Ben and Jerry woke up one day and realized they were becoming businessmen. “It wasn’t exactly our idea of a good time,” Jerry said. “Business had all these negative connotations and we felt like our business was just becoming another cog in the economic machine and we didn’t want any part of that.”

They were about to abandon ship when they received life changing advice: if you don’t like the way you’re doing business, change the rules. Decades later, Ben & Jerry’s is almost as well known for its social initiatives as it is for its decadent Cherry Garcia and Chunky Monkey.

Today, Jerry believes business is the most powerful force for change that we have. He’s convinced that the double bottom line is what has made Ben & Jerry’s a success – that operating from your values reaps rewards. Their approach has helped blaze a trail for a new, perhaps more intentional generation of social ventures.

We’re recapping the entire day on the Venture4Change website, starting with Tony Piggot’s session, Marketing Meets Mission: The Story of Brandaid Project.

Written by: Jennifer King, Director, Social Ventures initiative, Capacity Waterloo Region
Photos by: Tomasz Adamski

Acumen Fund lands in Toronto

Last Monday night I pushed my way through a large and boisterous group, made up primarily of Generation Yers (or is it Z already?) and, despite my aversion to crowds and a case of jet lag having just returned from Costa Rica the night before, I was glad I did. What brought so many faces out to Czehoski on a Monday night, you ask? It was the ceremonious launch of Acumen Fund'€™s Toronto Chapter


The brainchild of former Wall Street maven Jacqueline Novogratz, Acumen Fund is a nonprofit social venture that puts its unfettered faith and hope in the power of entrepreneurs to fight the longstanding scourge of global poverty. Believing that neither charity nor markets alone can meet that radical challenge, Acumen promotes a hybrid paradigm that combines both. This blended values approach, investing in solutions that have potential for social impact and profit, has been paving the Fund’s path to change since it launched in April 2001.

Also referred to as patient capital -- debt or equity investments of $300,000 to $2,500,000 in an early-stage enterprise with payback or exit in roughly five to seven years (but unlike a typical venture capital firm, if that goal is not met, Acumen won’t walk away) -- financial and social returns are the result. Don’t look for grants here, though; you won’t find them. What’s more, all financial returns are recycled into new investments, with every dollar invested leveraged four times.

Today, Acumen Fund boasts 27 investments and a portfolio worth just under $40 million, not including a recent capital markets fund of $15 million. The focus is on supporting enterprises that provide low-income consumers with access to five specific areas: health, water, housing, energy and agriculture. And by the look of it, they’re getting somewhere. Case in point: D.Light, which uses LED technology to provide a much-appreciated alternative to kerosene lanterns, known to be more expensive, lower in quality and veritable fire hazards. As a side note, it is estimated that more than 1.5 billion people in the world live without access to electricity.

D. Light was created by social innovators and funded by Acumen ($800,000 in 2008, $400,000 in 2009) and a number of other investors. And how is the hybrid model working for them? Well, let’s see. Since 2007, D. Light sold 115,000 lights, impacting an average of 500,000 lives while their main competitor, Tata --dependent solely on grants -- sold 5,460. Not exactly a full-blown analysis or conclusion, not by a long shot, but the numbers make it well worth taking a long, hard look at the patient capital model and its potential for real change.

Interestingly, as I made my way across the crowded room, chatting to whomever I could (tripping the waiter and stepping on about five toes in the process), it occurred to me that while many attendees knew a lot about consulting and business, they knew little about venture philanthropy. When asked what brought them here, the answers were diverse but shared one common theme: the desire to support a different way of doing business toward the eradication of poverty. Considering the response to the event, it seems the new Toronto chapter, with its goals of fueling knowledge, conversation, fundraising, awareness and more, is heading on the right track.

By Elisa Birnbaum

A Sea-Change in Citizen-Led Water Action

I tripped upon an interesting blog the other day, Reversing the Flow by Brita Belli in eMagazine (April 2010). In it she talks about the Global Water Network. She says “Earth Day Network’s lesser-known side project is called the Global Water Network. Unlike the much more visible Earth Day—celebrating its April 22 40th anniversary this year with projects that include ‘A Billion Acts of Green’—the Global Water Network (GWN) is only in its second year.

It’s a means for connecting donors with water projects across the globe—with Earth Day Network (EDN) acting as a conduit, especially in encouraging U.S. schoolchildren to take up collections for children abroad who lack clean drinking water access and proper sanitation. ‘In the U.S.,’ says Beth Larson, EDN’s international education coordinator, ’students don’t feel empowered. But just a small amount of money can go a long way in places like Burkina Faso.’”

Absolutely! Small amounts of money can go along way around the globe, Canada included. We have a project profiled on www.smallchangefund.org right now, for example, that only needs $1250 to upgrade a boat so that the organization, Fundy Baykeeper, can expand the scope of their water monitoring work. A little can go a long way. It’s a great point. It’s also interesting that she’s hit on the issue of connecting donors and empowering students. That’s a big challenge and one we’ve taken to heart at Small Change Fund. How do we engage – truly engage – Canadians in protecting our precious water resources and those of communities around the globe?

Brita goes on to talk about the collaborative work between our global partner, Global Greengrants Fund, and Aveda. “Hair and skin-care company Aveda has had a partnership with Global Greengrants Fund for more than a decade, in order to direct money to environmental causes and has seen a ‘dramatic spike in fundraising with the issue of clean water,’ says Katie Galloway, Aveda’s Earth Fund manager. The company itself looks for ways to lower its water footprint, she says, and has expanded Earth Day to ‘Earth Month,’ since 1999.

Through sales of a limited edition ‘Light the Way’ candle, as well as via Walks for Water, Aveda raised some $3 million for environmental causes last year, just over $1.1 million of which went to Greengrants. And the company specifically directs grants to areas of the world where they source ingredients. ‘The best example is Madagascar,’ says Galloway. ‘A lot of our essential oils and aromas are sourced there, such as clove and cinnamon…Greengrants did a grant in the Southeast part of Madagascar where they cleared out a well and installed a solar tank and water tank. As a result, 2,000 people in Madagascar now have access to clean water.” But despite this she says, “Lack of funding is the biggest impediment to fresh-water access in the developing world.’”

We need to celebrate the companies that are putting money back into communities. Like Aveda. Like Lush that recently funded 4 Small Change Fund projects. (Thank you Lush!). What’s more, we need to explore, promote, refine, and celebrate the new tools that provide a gateway for everyone to support water work world-wide to help meet grassroots funding challenges. Organizations like Charity:Water, Kiva, Small Change Fund, and Social Actions are pioneering new ways of galvanizing citizen-led action on important social and environmental issues around the globe. But it’s all new. There’s no real road map. We’re all feeling our way along to the most effective, most engaging, most sincere, most transparent means of empowering you, empowering all of us, to get involved. So how do we do it? We need feedback. We need inputs. We need to learn.

Which brings me to one of my favourite authors, the late Donella Meadows of the Sustainability Institute. She was so wise. She said “Working with systems, on the computer, in nature, among people, in organizations, constantly reminds me of how incomplete my mental models are, how complex the world is, and how much I don’t know. The thing to do, when you don’t know is to learn. What’s appropriate when you’re learning is small steps, constant monitoring, and a willingness to change course as you find out more about where it’s leading. That’s hard.”

It’s hard, but it’s necessary and perhaps the only way in this world of social innovation, new media, and change-making. So help us find out more about the engagement question. How do we connect you to global water causes? How do we empower a sea-change in citizen-led action? How do we realize the power of your small change?

By Ruth Richardson, originally published at SmallChangeFund.org