I must confess: I was recently asked to be on a panel about Social Ventures and didn’t know what that meant. So I googled it and found a bunch of stuff summarized as follows:
Hey! That sounds like our BizGym Foundation mantra of “Profit to SHARE!” So they’re preaching to the choir as we believe that nonprofits and for-profits should have more in common than not in common. The fact is, type of entity shouldn’t matter. What does matter is that an entity is self-sustaining and does good for society. Here’s how the concept manifests for various entity formats:
1. NONPROFITS Should Operate In Business-Like Fashion
Nonprofits traditionally have a rough time in recessionary times as grant and donation support shrinks. Today is no exception with many are going under or being forced to merge with others. In this context, the notion of Social Venture provides a sustainability answer through applying business skills to teach nonprofits how to fish rather than make them wait for support to be given to them. Indeed, the title “nonprofit” is misleading as it implies that profit-making is irrelevant to social organizations. The Social Venture movement suggests that for-cause organizations should look toward profit rather than away from it if they wish to survive.
2. FOR-PROFITS Should Upgrade Value Proposition to a Cause
In the early 70’s Coke hit it big with the song campaign, “I’d Like to Teach the World to Sing.“ Campaign magazine recognized it as, “one of the best-loved and most influential ads in TV history.” Articulating the positive sentiments of the flower-child generation during the era of the unpopular Vietnam War and turning it into a cause was pure genius. Coke offered hope to a world thirsty for good vibes and championed it for decades to come. Every business starts from a desire to provide value and do good but raising the bar from mere value to a cause could propel your business to greatness.
3. B-CORPORATIONS Agree to Be Social Ventures
B Corporations are for-profit corporations that voluntarily meet standards of transparency, accountability, and performance, in order to offer a positive vision of a better way to do business. Companies can apply for b-corp designation and if certified, agree to performance requirements. As a B-Corp, a company can build relationships with other entities that support social ventures, however B-Corps are subject to taxation like other for-profit corporations. 30 States in the US recognize B-Corps now and the movement seems to be gaining steam so it’s worth checking into if you’re operating a business and have your sights on a legacy play.
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