BOOK SUMMARY 406 The Business of Good

BOOK SUMMARY 406

The Business of Good

·         Summary written by: Ronni Hendel-Giller

"We are now faced with the fact that tomorrow is today. We are confronted with the fierce urgency of now. In this unfolding conundrum of life and history, there “is” such a thing as being too late. This is no time for apathy or complacency. This is a time for vigorous and positive action."

- Martin Luther King, quoted in The Business of Good, location 1908

I had the fortune to read this book while attending the all-fellow’s conference of Echoing Green—a non-profit that funds social entrepreneurs across the globe who are working at the intersection of social justice and social innovation. If I hadn’t been at the Echoing Green conference, working directly with a group of social entrepreneurs, I probably would have been a great deal more skeptical than I am about Haber’s book.

Reading this book (and attending the conference) at the close of the 2016 election season in the United States, when many are feeling unsure about where we are headed, was a perfect choice. Jason Haber paints a positive, glass 3/4 full picture of the power of business to do good in the world—full of stories of people and businesses charting new territory in making a difference. This is not a how-to book, for that you’ll need to look elsewhere—however, there are some actionable gems to be found—and tons of inspiration. 

The Big Idea

The Great Convergence

"The zeitgeist shift, The Great Convergence, makes it possible to envision an entire reboot of capitalism in a way that lifts people up, solves problems, and promotes lasting change. It’s called Capitalism 2.0, and its engine is social entrepreneurship."- The Business of Good, location 608

Haber shares that social entrepreneurship has grown, since 9/11, at an astonishing pace. He attributes this to what he calls “The Great Convergence.” What is converging? A shrinking world (we now more and are more connected) and a troubled world (facing new and daunting challenges) are creating a higher level of awareness—and rewriting the “rules for how society lives, works and plays.”

The mix of entrepreneurship with a desire to make a difference creates an opportunity for profits and purpose to co-exist, rather than live in conflict. And, perhaps even more importantly, social entrepreneurship is a means which “private sector actors solve public and private sector problems that are not being addressed.”

What I read in Haber’s book—and saw at Echoing Green—is that behind each social entrepreneur is a “bold idea”—a way of articulating a challenge in a new way and bringing in a new type of solution that engages and empowers all stakeholders, including consumers.

This is summarized beautifully in a quote from Bill Drayton of Ashoka (another organization that supports social entrepreneurs:) “Social entrepreneurs are not content just to give a fish or teach how to fish. They will not rest until they have revolutionized the fishing industry.”

Insight #1

The Base of the Pyramid as a Market

"The approach of the social entrepreneur is new. It requires challenging the status quo. Instead of looking to the poor as a group to be pitied, social entrepreneurs view them as a market where goods and services can benefit both parties."- The Business of Good, location 789

Truth be told, the above quote challenged me at first. Isn’t this still manipulation? Here’s the thing: Inherent in social entrepreneurial ventures is a deep shift in our understanding of the power and voice of those who sit at the so-called Base or Bottom of the Pyramid.

First—terminology: The BoP generally refers to those four billion or so people who live on less than $1500 per year. And, while social entrepreneurial ventures are not limited to this population, it is a primary focus. Viewing this population as one that has voice and can be a responsible consumer is a significant and powerful shift. Haber draws on the work of CK Prahalad, who wrote The Fortune at the Bottom of the Pyramid.

While there’s far more to it than can be covered here, suffice it to say that Prahalad’s proposal to reach this population presents a new way of thinking about how we operate a business. His four A’s are: awareness, access, affordable and available. This approach is respectful of the shared dignity of all people and recognizes that people need more than handouts. What is most needed is the opportunity to generate revenue and use that revenue to buy products that create lives that are more sustainable.

Haber shares a powerful example. d.light brought durable, powerful and beautifully designed solar lanterns to market, reducing the cost for consumers (vs. kerosene) and creating a healthy alternative. They now have 51 million customers in 60 countries—with a goal of reaching 100 million by 2020.

Scale is powerful. When products are sold at very low margins (which is almost always the case,) volume becomes essential. The ability to generate volume becomes a powerful challenge for social entrepreneurs—without scale, success is very difficult.

Insight #2

Measurement Matters

"Today there is a new group of philanthropists who are redefining what it means to give. In fact, they aren’t really “giving.” Instead, they are Kickstarters of social enterprise. Just like with the crowdfunding platform, those putting money in expect something in return."- The Business of Good, location 1671

Haber outlines a myriad of large and small foundations and philanthropists who are giving to support innovative social entrepreneurs—working in both the for-profit and non-profit sectors. This new band of investors is like traditional investors in that they need to see a return on their investment. The difference is that this return is measured in different ways. Impact investing can focus on the enterprise (the business) or the person (the talent)—there are successful examples of both.

The importance of measurement of impact cannot be understated. When measures are not as straightforward as profit, the ability to identify the desired impact and to be able to report on it is enormous. d.light’s ability to measure and tell its story is critical to its success. Measurement also is critical when experiments fail—enabling the experimenters to tweak their strategies, and to re-group and try again—while continuing to garner investment.

Measurement is another area where a social entrepreneurial mindset differs from a traditional non-profit mindset. When I was with the Echoing Green fellows I noticed that, to a person, when asked what their work was they talked about the bold idea (an innovative solution to a social challenge) and the way they would know if they addressed it. That was the essence of the elevator speech. Haber successfully demonstrates why this matters so deeply.

The Business of Good is full of compelling, inspiring stories. You will need to read the book to hear those stories—and I think you’ll enjoy it. Haber’s very readable book helps you feel a little better about the good we can do and the possibilities for making the world a better place.

Read and enjoy!