Wednesday, July 11, 2012

Business as Charity: The Ever-Evolving World of Social Impact

As someone who takes social-impact work very seriously, I’ve found the Stanford Social Innovation Review to be an invaluable window into the world of social and economic justice.

I recently came across an interesting SSIR blog post which touches on what I think is a very constructive development in the world of charity: business as charity.

In our current economic climate, where job creation is a keystone in every political campaign, Jim Koch, founder of the Boston Beer Company (they make Samuel Adams beer), decided that instead of giving money to charity he would become, essentially, a microlender. His new program, called Samuel Adams Brewing the American Dream, gives small loans to small food, beverage and hospitality businesses in South Boston.  It also provides free coaching and mentoring from members of Koch’s team. The point? Trying to create new jobs by supporting small business rather than non-profits.

This is an excellent idea. Even a small loan can determine whether a micro-entrepreneur’s business succeeds or fails; I’ve seen this firsthand in my own business.

At ThinkInk we recently launched a PR and thought leadership campaign for a Miami-based microfinance company, OUR Microlending. To date, the company has disbursed about $6.2 million in loans to over 600 small businesses across South Florida, including a Colombian souvenir store, a printing and vinyl signage shop, a cell phone accessories wholesaler and a nutritional consulting and supplement store. These are hardworking entrepreneurs whose loan applications were rejected by the big banks. Because of OUR Microlending’s services – which are sorely needed all over the United States, not just in the developing world – these self-starters have been able to grow their businesses and create jobs to help stimulate their neighborhood economies.

Of course, this is not to say that I don’t think we should support nonprofits. In fact, we are in the process of restructuring The ThinkTank, a division of ThinkInk that is devoted to helping nonprofits grow their organizations through visibility and intelligent PR. We’re recreating the company into a for-profit/nonprofit hybrid that would allow us to significantly expand to this unit to help more nonprofits throughout South Florida.

In his SSIR post, author Aaron Hurst, founder of the Taproot Foundation and a well-known leader in the world of non-profits and social-impact, asks: is business the new charity?

I’d have to say no. Charitable giving is still crucial to nonprofits’ ability to fulfill their missions. However, considering how difficult it is today for the owners of very small businesses to access traditional banking services, I hope to see many more programs like this spring up to help create much-needed jobs and re-energize our still-shaky economy.

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