Random Musings

• Moderator: Betsy Densmore, Social Enterprise Institute
• Alan Gershenfeld, E-Line Ventures
• Lauri Alpern, ROI Ventures
• Paul Lamb, Man on a Mission Consulting

Nice gems of advice:

Alan - make sure you have a clear understanding of the impact you desire; constantly ask how does impact align with how you are making money - if there is a misalignment, do not start until the alignment issue is solved.

Lauri: Questions to ask yourself - what is your passion? what drives your resource engine? what can you be the best at? also, you need an engaged and informed BOD, educated BOD is not enough.

Paul - three key points - 1) most ventures suffer from lack of a key business model; don’t try to be everything to everyone; make sure your business model or tagline fits on a t-shirt.   2) do your diligence on your industry and competitors. 3) many ventures have a lack of focus on marketing, esp in early stages. you need to be able to sell both the social story and the financial story to different audiences; some people react to one more than the other, so be flexible in your pitch.

Return on Social Investments - what do investors want?

Alan: There is a scale between social return and financial return. know where you are on that scale and know where your potential investors are - there should be a clear understanding on that. [PIC coming]

What about the Mozilla Foundation model of for-profit sub?

today I am at the social capital markets 2008 conference, aka socap 2008 and the conference is absolutely bustling with energy and people. i will be putting together a more polished post later on for om, but i will be putting down my notes and random thoughts here.   i am starting off my day with a social capital markets 101 panel to get a good overview of the topic.

• Moderator: Eric Nee, Stanford Social Innovation Review
• Josh Becker, New Cycle Capital
• Tim O’Shea, CleanFish
• Lloyd Kurtz, Nelson Capital
• Megha Doshi, Haas School of Business, UC Berkeley

according to Doshi, 10% of assets under management in the US are under SRI (socially responsible investment) management, the bulk of which is still limited to institutional investors. however, that is a huge amount of capital - a much higher percentage than i would have guessed.

Josh was at redpoint ventures in a previous life. when asked how he got his start, he said he saw an opportunity to make money (still talking the VC 10x return line) while doing good things.

Tim, when asked if he saw himself more as an entrepreneur or as a social entrepreneur when he started cleanfish, he answered “entrepreneur” without hesitation.

Audience Question: what is the line between non-profits and social entrepreneurship?

Tim said the last thing the world needs is another non-profit with another board of directors with another mission.  he thought the market was ready for this kind of venture.  his description of current capital markets system is “not working” as audience murmurs in agreement.

Josh - entrepreneurship is a mentality.  he says the line between non-profits and social entrepreneurship ventures is scale.  take the right kind of capital for the goal you have in mind.

Megha - lines between non-profits and social enterprise is blurring, but so is the line between social enterprise and large public companies with social missions.  said we need to think about when is a shareholder a more important stakeholder than say the environment? (lawyer note: under corporate law, the shareholders’ interest is the main interest of the corporation. if officers and directors fail to look out for shareholders’ interest, then they could be in breach of their fiduciary duty).