12/26/14 | Uncategorized

How Your Startup Can Both Do Good and Make Money

It’s Christmas – a time of goodwill – but if you’re setting up a social enterprise, you need more than just good intentions.

By Melissa and Carolina Cantor (Co-founders, Shopethica.com)

With 84 percent of millennials worldwide saying that they’d rather make a difference in the world than achieve career recognition, it’s no surprise that mission-oriented companies are on the rise. But starting a business is challenging enough; starting a purpose-driven business entails a separate set of goals, concerns and priorities that exist in addition to the imperative to turn a profit.

More than two years into our own experience launching an ethical fashion boutique, the most important piece of advice we can offer aspiring social entrepreneurs is this: Define your mission.

Define Your Mission

This may sound obvious — until you consider all of the various forms that “help” can take, and all of the different ways people think “good” can (or should!) be accomplished.

One clothing designer we work with sources embroidered textiles from an indigenous community whose members have largely abandoned the craft. By paying a premium for their products, she aims to provide economic incentives for the younger generation to learn and preserve this textile tradition.

During a meeting with a magazine editor about her line, the designer was asked if she would be “giving back” to this community by donating a percentage of her profits. The question surprised her. “What I’m giving them is my business,” she said.

She, along with many other small businesses that subscribe to a “Trade Not Aid” philosophy, believes in providing long-term economic opportunities, rather than direct donations, to workers in the developing world. Other companies take a different tack, following a one-for-one model à la Toms and Warby Parker, or linking sales to fundraising efforts.

Brace Yourself for Criticism

Nearly any approach you take as a social entrepreneur – and even your company’s mission itself – is likely to garner its share of proponents and critics. That’s why it’s important to have a clear understanding of what your mission is (as well as what it’s not), and how that mission is served by the business model you have in place.

Without this clarity and conviction, it’s easy to be blindsided by criticism, or fall victim to “mission creep,” which can divert your limited resources.

Be Specific

When we conceived and launched Ethica, we did so because we wanted to address two massive problems within the fashion industry: the inhumane treatment of garment workers, and the industry’s toll on the environment. There are other definitions of ethical fashion that are broader, and some that are narrower. Our work is by no means all-encompassing, but because it’s been guided by the same two principles, it is consistent and cumulative.

When it comes time to define your mission, this kind of specificity is key. Whether you gauge your impact by the number of people you employ or the amount of dollars you contribute to a cause, remember that social entrepreneurship is not a zero-sum proposition. Not being able to do it all shouldn’t prevent us from doing what we can, and we have to stand for something before we can do more.

What’s your mission?

Photo credit: wk1003mike via Shutterstock.



The Switch Editorial Team.

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