Posted: April 4, 2014
Doing good and doing business, in the minds of many, are two separate things. But there’s a growing movement to change that, and Seattle is at the forefront of it. This change is being fueled by people who have a new vision for business. One that focuses not just on the bottom line, but on what’s called the triple bottom line: profit, people and planet.
The emerging business model goes by many names – social entrepreneurship, for-profit social enterprise, conscious capitalism and others. Whatever the name may be, the idea remains the same. These organizations are in business to make a difference and a profit.
“I’m seeing a lot of people in the Seattle area who are questioning the way businesses have traditionally operated,” said Corey Weathers, UW alumnus and principal of Catalyst 2030, a company that helps other organizations become more environmentally sustainable. “If businesses are always driven by the bottom line, we’re never going to make the progress we need to have sustainable communities and a healthy environment,” Weathers said. “We can take the fantastic success we’ve had in this country in the business environment and figure out a way to apply that to solving our most pressing problems.”
Corey Weathers is principal at Catalyst 2030, which provides sustainability coaching.
Using business acumen to address social problems makes sense to Michael “Luni” Libes, founder of six startups and Entrepreneur-in-Residence emeritus at the UW Center for Commercialization. In 2011, Libes switched his focus from building high-tech startups to supporting socially and environmentally conscious entrepreneurs through his conscious company incubator, Fledge. “For a lot of the problems that I see social entrepreneurs tackle, there are 2 or 3 billion people with that problem. So as long as you can find a model where they pay you more than it costs to serve them, that’s a business with 2 or 3 billion customers, which is a global business.”
“There are certain components that turn a place into a hub for enterprise,” Libes said. “They include talent, places and events to bring those talents together, an educational backbone, money to fund it and programs to help things happen quicker. And Seattle has all these components for social enterprise.” Not surprisingly, Seattle has a growing social entrepreneurship movement, and we’re getting press for it from publications such as Fast Company and Forbes.
Luni Libes founded six startups, including the conscious company incubator Fledge.
A unique place has developed for Seattle social entrepreneurs to gather: 220 & Change. This 50,000 square-foot workspace in historic Pioneer Square houses dozens of organizations and hundreds of individuals who use this space for social enterprise ventures. Impact Hub Seattle is one such organization, providing a coworking space for more than 500 people. Weathers described a recent event there for a social entrepreneur incubator program. “It was packed,” he said. “There were hundreds of people there. I think people are looking to invest in corporations that are not just out there to produce a profit but exist to make a difference and make our communities better.”
Part of the educational backbone supporting social entrepreneurship in the city is the UW Foster School of Business, which encourages social enterprise with its annual Global Social Entrepreneurship Competition. Students from across the globe present business solutions to some of the world’s biggest challenges – including poverty and health and development issues – and vie for $40,000 in prizes to support their social enterprise ventures.
At the state level, the demand for socially and environmentally accountable businesses led to the 2012 passage of legislation allowing for Social Purpose Corporations, or SPCs, in Washington state. This type of legislation is in contrast to a historical court ruling that says corporations exist for shareholder profit, which is often cited by shareholders or corporations to justify putting profit-driven actions above environmental, community or employee benefits. SPCs, however, are a form of for-profit incorporation that gives companies legal support to promote sustainability and social good in addition to financial profits.
“No doubt the SPC legislation passed because the social entrepreneurship movement was picking up,” said Libes. “If there wasn’t any demand for it, it wouldn’t have happened.”
Weathers’ company Catalyst 2030 was one of the first in the state to become an SPC. “We considered going the nonprofit route. Some of the challenges with that route right now, however, are that funding is very limited and so many people are trying to pull from the same funding pool. It was a better fit for us to be a business that could charge fees rather than draw from the nonprofit funding pool,” Weathers explained. “We set forth our articles of incorporation and said that our work will benefit the environment, the community and our workers.” Washington’s legislation requires SPCs to provide yearly reports that showcase what they’ve done to achieve their social purpose as well as their plans for the future. This transparency, Weathers said, helps his company stay focused on its mission.
Running a social entrepreneurship is very much the same as running any other business, Libes explained. The difference, he said, is the motivation. “In the social enterprise space, it’s full of people with passion,” said Libes. “It’s full of people who are doing things because they want to solve a problem, because they think the world will be better if the problem is solved.” Instead of just working to pay the bills, when you work for a social enterprise, he pointed out, “you feel like you need to go to work today because you are lessening poverty or making lives better or doing some other good in the world. And that will easily get you up and moving.”
For Weathers, serving his community has always been in his blood, and he’s participated in committees and task forces as well as worked in the nonprofit and public sectors. “I wanted to be able to continue to give back, but I also wanted to build a business that was going to be able to provide for a financially stable future,” he said. By continuing to work in the nonprofit industry, he explained, “I would have been able to do some satisfying work, but I’d always be stuck in the reality that if you work in the nonprofit sector you will make a limited amount of money.”
Social entrepreneurship provided a way for Weathers to do work in line with his values and have more control over his personal finances. “I want to serve my community, but I also want to be able to live a comfortable existence. I think we can do both, and I think we can do it in a responsible way,” he said. “After many years of doing different things, I’ve finally found my place in terms of that balance.”
To learn more about social entrepreneurship in Seattle, check out 220 & Change and find out about upcoming events there, including a weekly public tour of the Impact Hub coworking space. Or, check out the Seattle Social Enterprise Meetup site.
If you want to launch your own social enterprise or join one, you may want to delve into business development, learn the latest online marketing strategies or brush up on your tech skills. UW Professional & Continuing Education programs cover a broad range of topics that can help, so explore your options on our website.
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