[This post was originally published on GeekWire, June 13, 2013, under the title "Tough Love and Less Purity for Impact Entrepreneurs."]
One reason I love getting to know social impact entrepreneurs is that they are among the most sincerely passionate entrepreneurs I ever get to meet. They’re not just enthusiastic and driven, which often gets labeled as passionate.
Social impact entrepreneurs care deeply and passionately, about their projects in a very personal way. And their missions are often so profound and inspiring that I get goose bumps just hearing them talk about it. Occasionally, I even get a little choked up as I imagine what they want to accomplish and the impact they would have if they were to succeed.
I was moved in just this way recently when I met a wickedly smart and infectiously passionate entrepreneur whose simple vision could have profound, life changing impacts for children all over the world. (Wow… I just got a lump in my throat just thinking about what she wants to accomplish.)
(Out of respect for confidentiality, I am not disclosing the particular entrepreneur or her mission. However, she did review this piece prior to posting.)
Moreover, her idea is not only brilliant and potentially highly impactful — it’s also a very simple idea and straightforward to execute on. That’s part of what makes it so brilliant.
But once I felt that I understood her project (and cleared my throat) I found myself doing what I always seem to do — rooting around for the biggest, hardest problems that will challenge the success of the business.
In my view, she had some potentially fatal issues.
She was trying to tackle too many, disparate problems all at once and that was going to complicate her messaging and dilute her resources, her impact, her brand and her chance for success.
It was also greatly complicating the organization she’d need to build to reach sustainability… which in turn increased the risk she would fail to even get things off the ground at all.
She was impractically concerned about optimizing every single aspect of her venture, looking for the absolute greenest and healthiest (and, as it turns out, slowest and most expensive) way of doing every last thing. And every single one of those things had literally zero to do with her core mission.
It was also going to massively delay the launch of her product… by about 500 percent. In the meantime, while she was focused on things that had roughly nothing to do with her mission, how many kids would continue to suffer while she got all that irrelevancy worked out.
I’m not trying to be the bad guy (although it often feels that way). You see, having a great idea and being passionate about it is absolutely not a guarantee for success. In fact, I’d go so far as to say that those two things combined give you only a very marginal advantage at best. As I’ve written before, very few awesome ideas turn out also to be good businesses and passion can be as much a curse as a blessing.
In the case of social entrepreneurs, these challenges are increased because:
- Social entrepreneurs often focus on how to bring their idea to life and not on how to build a sustainable or scalable business around it. As such, they are perhaps more likely to miss the warning signs that their idea is not also a sustainable business.
- Their passion is so strong that their blind spot is just that much bigger.
Add to this that they get less brutal feedback from advisors and mentors — no one wants to rain on their parade. Personally, I think it’s unfair to coddle them. In many ways, they need even more tough love than their self-serving, free-market counterparts because the get so little of it and their missions are so important.
I find that business-focused conversations with impact entrepreneurs can run pretty much the same way as with their capitalist counterparts. With a few exceptions.
- First, impact entrepreneurs are usually less comfortable and less interested in talking about the business aspects of their business.
- Next, impact entrepreneurs suffer (I would say) from a notion of purity that is counter-productive to their mission and vision.
- Next, impact entrepreneurs have such a refined radar for identifying good things that need doing that they try to do too many good things all at once, diluting their chances of success in creating significant and lasting good of any kind.
- Finally, impact entrepreneurs are more caught off guard by “tough love” conversations.
I won’t speculate on why or whether these things are really happening. I’m certainly open to discovering that these observations are either mistaken perceptions on my part or actually a byproduct of something I’m doing poorly.
What I can say is that it doesn’t need to be this way and for many social impact entrepreneurs it’s not. Impact entrepreneurs who participate in programs like Fledge and Bainbridge Graduate Institute (BGI) have a terrific opportunity to develop their business acumen through rigorous programs of education and mentorship. The quality of engagement in these programs is very high and there is no shortage of tough love.
But space in these high-quality programs is finite and competition is fierce. Inevitably, many otherwise very bright and passionate impact entrepreneurs are unable to participate.
Regardless of whether an impact entrepreneur makes it into an accelerator program or educational institution, I have found that there is a way to make headway on all fronts, essentially turning what I believe are four liabilities into four actionable principles that will make a difference. In a nutshell, the four principles are:
- Care deeply about building a sustainable and scalable business, as it will increase the impact you will achieve
- Temper purity with practicability insofar as it supports your core mission without compromising your core values
- Focusing your goodness radar on achieving your core mission
- Embrace “tough love”
These are principles that will help impact entrepreneurs get the business parts right while they’re busy focusing on the social impact parts. The mechanism for impact entrepreneurs to exercise these four principles is holding themselves accountable to a personal impact report.
A personal impact report is an attempt to account for the overall impact you bring into the world through your social impact business — not just your ability to get your idea off the ground and “make a difference”. The challenge becomes how you can do that in the most sustainable and scalable way possible.
We’d probably all agree that making a meaningful improvement in the life of just one person is a laudable mission. Every time you do that, you do something awesome. But how much more awesome is it to make a difference in the lives of hundreds… or thousands… or millions? Of preventing 1,000 tons of Co2 from entering the atmosphere… or 1,000,000 tons or 10,000,000 million tons? Or providing clean water to 10 villages… or 100 villages… or 1,000 villages?
Sometimes, less is not more.
Of course, you’ve got to start with one life, one ton and one village. Boiling the ocean pretty much never works.
But if, from the outset, you are not thinking about how you could sustainably scale your impact (by building sustainability into your model, intelligently tempering your purity, focusing your impact and attacking the hard business questions), not only are you setting yourself up to make a smaller impact on the world, you are also diminishing your likelihood of succeeding at creating any impact at all.
If an entrepreneur’s goal is to make a positive impact on the world, how could we possibly be critical of how they choose to go about it or how much they try to scale it? I think the easy answer here is that we shouldn’t be critical. Rather we should look for ways to support them. But, I propose, they should critical be of themselves and seek advisors and mentors who will hold them accountable for doing so. A personal impact report is a simple way to constructively do just that.
Here’s how it works.
A personal impact report measures the total amount of goodness your efforts produce in the world. As the entrepreneur who got it all started, you get fractional credit for all the efforts of the team you build and the product or service your company delivers. It’s kind of like building your “down line” in a multi-level marketing program like Amway. That’s why being the founder is such a big responsibility — you make many of the early decisions that will determine the potential depth and breadth (i.e., the impact) of that down line.
Precision is neither necessary nor feasible — being approximately right is superior to be being exactly wrong. A personal impact report need not be as rigorous as a written report complete with spreadsheets and critical analysis. It can be as simple as a mental exercise performed when big decisions need to be made. However, as with all forms of accountability, writing it down and sharing it with others are important.
When thoughtfully applied, I propose that the four principles will increase both success rates and impacts or social entrepreneurs. Am I right? Too soon to tell. What do you think?
Returning to the story I started with, the impact for the entrepreneur of thinking about the four principles I’ve proposed is likely to result in a magnitude increase in the amount of impact she will have in the very near term, will lay the ground work for a more-scalable impact down the road, and will extend that road farther into the future.
Starting a company is a daunting undertaking, whether your mission is creating wealth or creating social impact or both. Sustainability is crucial to all of them; scalability is crucial to many. Impact entrepreneurs owe it to themselves, their team and, most importantly, to the lives they intend to impact, to be passionate about getting the business parts right.