We’ve seen Jeff Skoll (eBay), Mark Zuckerberg (Facebook), Bill Gates (Microsoft), Warren Buffett (Berkshire Hathaway), Michael Bloomberg (New York City mayor and founder of Bloomberg financial news service) and others commit to the Giving Pledge—pledging to give away at least half of their wealth to philanthropic causes. Yes, these individuals built for-profit businesses but then structured those profits to be plowed into worthy endeavors.
Their positive leadership in this area has caused a healthy blurring of the distinctions between for-profit and nonprofit businesses. New entities under titles like social entrepreneurship and ethical capitalism are emerging from those who are in their twenties.
We’ve heard the Bernie Madoff phony investment stories, heard about banks that lend to unqualified candidates and seen the get-rich-quick promises on late-night TV. But not all businesspeople are greedy.
While making money can be an altruistic endeavor to equip and provide for others, greed is typically a shortsighted model for taking advantage of others. But on the other side of greed is the fear of money. Too many people shun the idea of making money as evil and believe good can be done only by nonprofits.
Unfortunately, the nature of nonprofit work can require its organizers to spend 80 percent of their precious time begging for money in lieu of working on the cause about which they are passionate.
Good intentions and a pure and giving heart are not enough. Economic accountability is a good thing. If an organization’s efforts are secured by God, the government or the heartstrings of generous individuals, it can be run inefficiently with little measurement of accomplishment. The businessman has no such cushion. Either something of value and fair exchange is produced and delivered, or the business will not survive.
In that sense, the business model can require more honesty and transparency than the nonprofit model.
Sometimes when a ministry asks you to contribute money, there can be the implication that the nonprofit has a higher calling and more godliness than any business that makes money could possibly have. But an organization’s listing as a nonprofit or a business is not necessarily an indicator of the worthiness of its work.
Many people ignore the basics of making any organization great and simply hope that others will fund their lack of business skills and inefficiency. In a follow-up to Good to Great, author Jim Collins said any organization must blend three components: What is your passion? What can you do with excellence? What is your economic model?
Lacking clarity in any of those will cause you to fail. Think about it as in this model: You must have all three legs to this stool. Missing any one will not describe work that releases your very best.
No organization should exist simply to exist. In a Fast Company article, “Why Charities Should Have an Expiration Date,” Nancy Lublin said, “A nonprofit exists to cure something, address an issue, or elevate the status of a group of people; if and when that’s achieved, we should be done.”
If the purpose has been accomplished, new methods have made it obsolete, no self-sustaining economic model is in place,or management is ineffective, any organization should cease to exist. Don’t expect to use guilt or pity as your method of funding your operation. Ethical capitalism is an honorable form of doing good in the world.
Change the world. Make some money. It’s an appealing prospect. Nonprofits were created because for-profits weren’t addressing some economic failures—pollution, poverty and illiteracy. The best solution, however, may not be either/or but and. What if there were a way to create solutions for those failures and to generate reasonable profits for the organizers at the same time?
Social entrepreneurship, ethical capitalism and other models create a way for doing well while doing good. What I mean by that is that you can change the world, address pollution or poverty, share the Gospel, make the world a better place—you get to decide what your passion is—and make money in the process.
John Sage, the founder of Pura Vida Coffee, exemplifies this is his interesting work history. Sage began his career at Microsoft, where he introduced Windows to the world. After that amazing success he registered for seminary but quickly realized he would be stifled in that environment. Instead, he recognized he could use his capitalistic addiction as his most effective tool for ministry and to create good in the world.
With a desire to help his college roommate in his efforts with the poor children of Peru, Sage and this roommate founded Pura Vida Coffee, where they sell fair trade, organic shade-grown coffee. Their philosophy is clear in their company motto: “It’s better to give than receive. Unless you can do both.”
And if you can do both to fuel and further a good cause, even better.
Excerpted with permission from Wisdom Meets Passion by Dan Miller and Jared Angaza © 2012 (Thomas Nelson).
