Fighting for a Double Bottom-Line

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Every entrepreneur gets their passion from somewhere different.  For some, the thought of wealth and independence is what fuels them, and that’s fine.  But the most successful entrepreneurs I’ve encountered truly believe that their endeavours are going to change the world and help improve people’s lives.

For-profit businesses force innovation and that that’s a good thing.  The majority of technological innovation comes from the for-profit world, and without it we’d be in trouble as a society.  Diseases have been cured, transportation problems have been solved, and education has been broadened all from for-profit ventures.  I love the for-profit world, and I always want to be a part of it.

But I also believe that the non-profit community meets needs that the for-profit world ignores.  Who is going to make sure that those without food and shelter tonight don’t starve to death?  Who is going to comfort those with incurable illnesses in their final days?  It’s complex to try to create a for-profit company to solve these basic human needs, but we are blessed to have people in this world who devote their lives to these causes.  Whether they are in the peace corps, a member of clergy, or just love helping, they also play a huge role in keeping our society from falling apart.  In many ways, these people are my heroes.  And so  I also want to desperately be a part of the non-profit world.

This isn’t really news to anyone who knows me.  However, as our success increases I begin to thing more about HOW to use our entrepreneurial skills to make an impact in both sectors.  Ten years from now I envision a full-fledged non-profit division of Pure Adapt (we’ve already purchased for that purpose), but I believe that there’s always something important you can do NOW regardless of how measurable it is to the outside world.

I’m happy to say that I think we’ll be taking that step with our next venture.  It’s pretty obvious to anyone that reads this blog regularly that our next move will be another foray into e-commerce given the success of the new Detailed Image.  So one day I was thinking “how could we leverage a successful e-commerce site to help change the world?”.  And then I came up with the simplest solution to a problem I’ve ever come up with:  donate a portion of revenue for every sale to charity.  Make it part of the culture of your site/store – every single purchase has a small impact in helping a non-profit that needs your money.  Sure, at first it won’t be much.  But it ensures that our non-profit impact is directly tied to our for-profit impact so as we have more money in our pockets we will also be making the world better at the same pace.

I’ll be honest – I was pretty nervous about bringing this up to my partners.  We are a for-profit company, and my partners have no real obligation to give a crap about the community and the charities that support it.  It’s one thing to buy and talk about what we’ll do when we have millions, but another thing to get everyone to agree to take action when we are all very much not settled in our lives.

Thankfully everyone has been very open to the idea.  After working out some kinks with the system, I think we’ve tentatively agreed upon donating 5% of profit (price – cost of goods sold)  for every transaction through our new site, which I anticipate launching in the spring.  We will likely change charities every quarter and cut the check for the previous quarter at the beginning of the next.  At first I wanted to do a percentage of the sale price, but we’d run into issues for products that have very small (or no) margins (some items we sell at cost to turn over inventory and bring customers into the store).  Either way – 5% of profit before all of our other overhead like marketing, rent, and salaries is still a pretty solid commitment.

I’ve never been more excited about anything in my entire life.  E-commerce is what we do best, and we’ll be able to do it in a way that satisfies our customers, provides a comfortable living for us, and contributes to the non-profit world.   I can’t imagine anything better than that.

5 comments on Fighting for a Double Bottom-Line

  1. Nev says:

    I personally DO NOT LIKE donating cash to most charities. After doing a lot of charitable work and seeing where a lot of the money goes, I feel you often get less bang for your buck by throwing a check at a charity (obviously this isn’t the case for ALL of them).

    I like to see charity giving that “Teaches a man to fish”

    Off the top of my head, Pure Adapt could teach some middle schoolers or Boy Scouts how to do minor car detailing and donate the neccessary supplies for a fundraiser. The kids learn something new, get some selling experience and earn the money themselves (that always makes it taste extra sweet). They could theoretically do this weekend after weekend to generate income, as opposed to relying on random handouts. You may have only given a fraction of the money to these kids, but they could generate income whenever they want with their new skills.

    One thing I did at my local library was donate a computer. I asked the head librarian and subsequently the main tech guy what they could use…turns out they could ONLY link up Dell Optiplex’s. So I located a used one from the University of Texas and sent it to them. It’s kind of cool when I roll by the library to read the magazines every week to see some kid using that computer…even if they are just watching the Soulja Boy video on YouTube! I started my first business from a computer at my high school, so who knows what can come of it.

    Since you’ve got so many tech guys at Pure Adapt, you might even consider re-vamping a non-profit website for pennies or for free. A donation like this could help the charity in many more ways than a check for $1,000 can.

    Be creative with it. You of all people know that simply throwing money at a problem doesn’t always make it better…but a little brain power can!

  2. Adam McFarland says:

    Wow Nev, you bring up some great points. I don’t look at it as an either-or proposition. For example, my partner Greg brought up having us all doing a “Big Brother Big Sister” type of thing at the local Boys and Girls club and I think that’s a great idea. We’ve also agreed to speak to the web design class at our local high school.

    I think we’re going to have to be selective with who we give our money to…possibly even make non-monetary donations (such as food or supplies, or a computer like you said). Either way, I’d still like to see that 5% go into a fund that we use for non-profit ventures.

    Thanks for the great comment! You definitely gave me a lot to think about….

  3. Adam McFarland says:

    You know what Nev, you gave me an idea. My partners and I were talking yesterday, and one of the things we are all pretty passionate about is education – improving the current systems, ensuring all kids have opportunities, etc. I came up with the idea of doing 5%, but donating it to OUR OWN charity where we focus on giving scholarships to local kids entering technology fields. This way we can have (eventually) various scholarships for different criteria, and we get the satisfaction of choosing the kids we feel deserve the money.

    I obviously need to run this by our lawyer and figure a lot of stuff out, but right now I feel a lot better about this idea than the initial idea.

  4. Tithing as this practice is known is promoted by some of the most well known success coaches in the world – like Anthony Robbins. 5% is a modest amount to donate to a cause that you are passionate about and perhaps ideally relates to the business you are in. Most of the Business gurus state they donate 10% of their profits to charity and they can’t keep up with their continues growth and success – stating that their is literally an unlimited supply of abundance to tap and this is a spiritual maturity one reaches in life that allows for this kind of overt generosity. Deepak Chopra is another motivational author speaker who suggests this. Look at Sir Richard Branson – CEO of Virgin Records, Airlines etc, just stated that all 20% of profits from Virgin Corp will go to invest in Green alternative energy – which is a way to give back to the Earth and the world.
    David Fairley

  5. Adam McFarland says:

    David – thanks for the comment. Yes, 5% isn’t much right now…but comparing us to Richard Branson isn’t fair either. My partners and I are still all in our mid-twenties and are just trying to make ends meet. We are still scraping to buy our first houses, not “sacrificing” a $10 million dollar house for a $1 million one. As we grow and secure our own personal lives a bit more, the percentage we give will grow as well. We (hopefully) have a lot of years left and can accomplish a lot philanthropically as we grow.

    Besides, when it comes to giving, I also try not to “keep score”. It’s not about that. It’s about doing what we can with our talents and resources to improve the world.

    By the way, this post is a bit old…the program is now in place and is called Commerce with Conscience Our first charity has been very excited to work with us and we hope future charities are equally as interested in the program.

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