We are developing a microjob portal for the masses. A large number of people do need that bit of extra income to sustain. Social change is possible by making money to flow to the needy. By offering their skills for a fee, they will be able to get additional income. We need support to take this forward. We hope to get response! Mail : david1 AT mobskills.com
We are developing an education concept that charges fees for education in Canada while financing free classes in orphans in the third world. Please check out our website http://www.shakeitforacause.com and don’t hesitate to contat us. We need and appreciate the support. .(JavaScript must be enabled to view this email address)
This is an excellent look at the factors to be considered in exploring social enterprise. We have a review of our recently failed social enterprise - Community Technology Gateway that might interest those researching this area of work and philosophy. We tried to provide a an information and communications technology service to our community organisations in the region at a community rate. We planned to be financially self-sustaining in 5-6 years. However, it didn’t get off the ground and the findings of our review correlate closely with what is written in this article.
Compliments to Julie, Matthew, John and Cheryl for astute observations on “testing ground” challenges faced by hybrid/benefits. Look forward to authors’ forthcoming study. July 17th webinar offered useful recap and discussion.
Arguably, social enterprise and benefit/hybrid movement arose in reaction to neo-liberal economic model. Aggressively promoted by Chicago-Friedmanite school and adopted by Reagan as well as Thatcher in 1980’s, this paradigm enshrined free market and profit making as central guideposts for economic action.
Lessons for integration of commercial and social value might be found in European and Asian economies which did not embrace neo-liberal standards. Germany and the Nordics in later 20th century constructed a “social market” economy which organically joined communitarian objectives with market outcomes.
According to studies by European Commission and leading German research institutes the ” Mitellstand” (medium sized companies) of Germany have for decades emphasized employee development , environmental safeguards and commitments to commitments. Only recently Germans are learning about CSR through U.S. influence.
Meng Zhao’s article in SJSI Spring 2012 issue and researchers at Cornell have identified for-profit “social welfare enterprises” in China which have pursued social missions with government and private sector supporters.
Authors are on point arguing that a supportive ecosystem needs to evolve, echoing much cited Kania and Kramer on article “Collective Impact” (SJSI Winter 2011). Advocates of “America Exceptionalism” may be slow to acknowledge that examples of these systems can be found in European as well as Asian culture and institutions.
Here in Australia, there is little if any government interest in hybrid models, (expect to make sure we pay tax on all our fee for service activities) and we are expected to juggle non-profit and for-profit entities.
The biggest problem we are working on as a hybrid and I think it is a problem in all Non-profit organisations that rely on a community of long term volunteers or low paid workers. These workers cannot have any equity or real ownership in a non-profits structure. This undermines the sense of community and puts an unspoken wedge between managment/executive (who control use of income) and committed workers. If the mission of the organisation ends or drifts from its original mission, long term volunteers can be let go with out any accountability to them. It is not unusual for social enterprises to ‘drift’ as you say away from their mission and sometime this drift is not because of the culture of workers in the organisation, but the politial machinations of executive and other top end stakeholders. Even when workers are members the problem remains because members face no finnacial impediment to one faction taking control of the organisation. This means that non=profit organisaions can develop a life of their own, independent of it workers and go on living long after the death of the community that gave them life.
A Low profitt enitity that had tax beneifits but allowed workers in the organisiation to own shares and equity would much better suit many Non-profits that rely on a community of low paid workers in my view. After all any dividens or closing down equity paid would be taxable under the individual income tax and capital gains tax regulations so there is no tax loop holes. And this would help volunteer communitys be more sustainable by relfecting their investment in hours and sweat in the ownership of the organisation, renforcing the sense of community and equality with management.
Interesting article. My major criticism is that it seems to set up straw men to knock down. The article promotes a number of purported opposites (e.g., beneficiary vs. customer, for-profit vs not-for-profit, hybrid vs. not hybrid), and then proceeds to knock each one of them down for more middle-ground, balanced approaches. It might have been best to have gone to the final conclusions first and skipped all of the straw men. False dichotomies obfuscate issues.
Chris Bartlett has implied that design approaches (e.g., matrix management) are really in people’s heads. I’d say the same thing for hybrid models. Seeing the world through labels and categorizations (as though they concretely existed) is inherently limiting and presents insidious biases. There are never permanent solutions, so structural responses (labels) never work—or they don’t work for long. Moreover, they are somewhat contradictory of an entrepreneurial mindset. Create, don’t define and label. Get with the flow of the world.
What I think one could use is sort of a “platform” approach to “the problems.” When one side of operations (let’s say the “for profit” side) is mutually dependent or serves the other side (let’s say, the “not-for-profit” side) and vice versa, then “the problem” disappears.
So-called “problems” are always that way: when you look at a problem long enough, when you finally see the truth inherent in a problem, the problem resolves itself. Labels, dichotomies (dualities), and definitions prevent resolutions.
Today, I went to the beach with my kids. I found a sea shell and gave it to my 4 year old
daughter and said “You can hear the ocean if you put this to your ear.” She placed the shell to her ear and screamed.
There was a hermit crab inside and it pinched her ear.
She never wants to go back! LoL I know this is entirely
off topic but I had to tell someone!
Loved the article. Wonder if there are folks out there who understand setting up a non-profit arm or turning one’s LLC into a non-profit? We are a national touring nutrition education theater company which creates and presents shows and resources to turn kids on to healthy habits. Schools and communities love our programs, evidence-based, award-winning, reached over 4,000,000 kids, but need more funding to help get program out to more schools. We’d appreciate it if someone out there understands these issues and would like to advise - thanks so much!
I am really surprised at myself to have bumped into this article 3 years after it got published. However, I am glad to read this up and to know that we are not the only ones solving the Hybrid Puzzle. Thanks to the authors for taking efforts to put this piece together. It will be great if the authors could come up with an updated version on this article especially since the dynamics of this space are changing everyday.
I really think it’s ideas like this that are going to become the mainstream in 5 years time. The current model is outdated, every non-profit needs to be looking at a for-profit model of generating revenue. Social enterprise is the new reality. We’re trying to introduce classes on the very subject her in Canada. It’s the only sustainable way I see organizations to grow in the future.
What about just setting up a business that create real value with care and respect of all the stakeholders and environments? Whay the impact has to be big? Can we think wall street as non profit organization? Sorry but I am idealist person and i like to indulge myself on absurd problems
This is remarkably helpful. For seven years I have been running a for-profit (S-Corp) publishing business with a social mission, (promotional services for mind-body movement educators, dance teachers, and somatic facilitators) and we have had a social mission from day one. After publishing a print magazine for several years called “Conscious Dancer” (our tagline is “movement for a better world”), and struggling with the business model of trying to be on the newstands and simply selling ads, I changed the model to a membership organization, and now we are called the Dance First Association. What we offer for money, (online promotional support and services for conscious movement facilitators) dovetails perfectly with our social mission, ie: more people dancing makes the world a better place, so helping dance teachers be more successful helps achieve this goal. I am currently in the process of expanding our business and broadening out our support structure by creating a hybrid, much like some of the businesses described in this article. A friend back used has a 501(c)(3) called the Fair Trade Foundation, and we’re looking at shifting 15% of the stock/equity in my S Corp. to become an asset of his nonprofit. So we are currently trying to figure out which activities fall under which umbrella, how the nonprofit will become the governing body in charge of the mission and vision, which way the funds will flow and how the activities will be contracted by the S Corp etc. We would like to host educational conferences under the nonprofit umbrella which would enable companies to be sponsors via tax deductable donations, as well as expand the revenue-generating activities on the for-profit side in order to fund scholarships and out reach for disadvantaged populations. I’d love to hear from anybody reading this who is interested and has insight into these sorts of evolving business structures. Thanking the authors for their great work here, and agreeing with the commentor above who pointed out the polarities that are unhelpful to the conversation. All in all a very valuable piece and I’m glad I ran across it while we are in the midst of figuring this out.
Mark (at) ConsciousDancer (dot) com
Your article has come across at a crucial juncture where i am about to launch my social-ecological venture but i could not figure how to reconcile the not-so conflicting goals of profit & social cause. I am not quite Indian legal-business recognizes hybrid models as yet. The Hybrid model representing a ‘Strong Sustainability’ aspects looks like has a promising future. Thanx
COMMENTS
BY David
ON May 23, 2012 02:19 AM
We are developing a microjob portal for the masses. A large number of people do need that bit of extra income to sustain. Social change is possible by making money to flow to the needy. By offering their skills for a fee, they will be able to get additional income. We need support to take this forward. We hope to get response! Mail : david1 AT mobskills.com
BY Antony
ON May 25, 2012 03:10 AM
Why does this article ignore the co-operative model? Otherwise a good article.
BY fadwa
ON June 4, 2012 08:10 AM
We are developing an education concept that charges fees for education in Canada while financing free classes in orphans in the third world. Please check out our website http://www.shakeitforacause.com and don’t hesitate to contat us. We need and appreciate the support. .(JavaScript must be enabled to view this email address)
BY Andrea Goble
ON July 24, 2012 08:02 PM
This is an excellent look at the factors to be considered in exploring social enterprise. We have a review of our recently failed social enterprise - Community Technology Gateway that might interest those researching this area of work and philosophy. We tried to provide a an information and communications technology service to our community organisations in the region at a community rate. We planned to be financially self-sustaining in 5-6 years. However, it didn’t get off the ground and the findings of our review correlate closely with what is written in this article.
BY Andrew Vitvitsky (Cambridge, MA)
ON August 1, 2012 10:42 AM
Compliments to Julie, Matthew, John and Cheryl for astute observations on “testing ground” challenges faced by hybrid/benefits. Look forward to authors’ forthcoming study. July 17th webinar offered useful recap and discussion.
Arguably, social enterprise and benefit/hybrid movement arose in reaction to neo-liberal economic model. Aggressively promoted by Chicago-Friedmanite school and adopted by Reagan as well as Thatcher in 1980’s, this paradigm enshrined free market and profit making as central guideposts for economic action.
Lessons for integration of commercial and social value might be found in European and Asian economies which did not embrace neo-liberal standards. Germany and the Nordics in later 20th century constructed a “social market” economy which organically joined communitarian objectives with market outcomes.
According to studies by European Commission and leading German research institutes the ” Mitellstand” (medium sized companies) of Germany have for decades emphasized employee development , environmental safeguards and commitments to commitments. Only recently Germans are learning about CSR through U.S. influence.
Meng Zhao’s article in SJSI Spring 2012 issue and researchers at Cornell have identified for-profit “social welfare enterprises” in China which have pursued social missions with government and private sector supporters.
Authors are on point arguing that a supportive ecosystem needs to evolve, echoing much cited Kania and Kramer on article “Collective Impact” (SJSI Winter 2011). Advocates of “America Exceptionalism” may be slow to acknowledge that examples of these systems can be found in European as well as Asian culture and institutions.
BY Timothy Trudgen
ON November 11, 2012 05:21 PM
Here in Australia, there is little if any government interest in hybrid models, (expect to make sure we pay tax on all our fee for service activities) and we are expected to juggle non-profit and for-profit entities.
The biggest problem we are working on as a hybrid and I think it is a problem in all Non-profit organisations that rely on a community of long term volunteers or low paid workers. These workers cannot have any equity or real ownership in a non-profits structure. This undermines the sense of community and puts an unspoken wedge between managment/executive (who control use of income) and committed workers. If the mission of the organisation ends or drifts from its original mission, long term volunteers can be let go with out any accountability to them. It is not unusual for social enterprises to ‘drift’ as you say away from their mission and sometime this drift is not because of the culture of workers in the organisation, but the politial machinations of executive and other top end stakeholders. Even when workers are members the problem remains because members face no finnacial impediment to one faction taking control of the organisation. This means that non=profit organisaions can develop a life of their own, independent of it workers and go on living long after the death of the community that gave them life.
A Low profitt enitity that had tax beneifits but allowed workers in the organisiation to own shares and equity would much better suit many Non-profits that rely on a community of low paid workers in my view. After all any dividens or closing down equity paid would be taxable under the individual income tax and capital gains tax regulations so there is no tax loop holes. And this would help volunteer communitys be more sustainable by relfecting their investment in hours and sweat in the ownership of the organisation, renforcing the sense of community and equality with management.
BY Mike Levenhagen
ON February 16, 2013 08:57 AM
Interesting article. My major criticism is that it seems to set up straw men to knock down. The article promotes a number of purported opposites (e.g., beneficiary vs. customer, for-profit vs not-for-profit, hybrid vs. not hybrid), and then proceeds to knock each one of them down for more middle-ground, balanced approaches. It might have been best to have gone to the final conclusions first and skipped all of the straw men. False dichotomies obfuscate issues.
Chris Bartlett has implied that design approaches (e.g., matrix management) are really in people’s heads. I’d say the same thing for hybrid models. Seeing the world through labels and categorizations (as though they concretely existed) is inherently limiting and presents insidious biases. There are never permanent solutions, so structural responses (labels) never work—or they don’t work for long. Moreover, they are somewhat contradictory of an entrepreneurial mindset. Create, don’t define and label. Get with the flow of the world.
What I think one could use is sort of a “platform” approach to “the problems.” When one side of operations (let’s say the “for profit” side) is mutually dependent or serves the other side (let’s say, the “not-for-profit” side) and vice versa, then “the problem” disappears.
So-called “problems” are always that way: when you look at a problem long enough, when you finally see the truth inherent in a problem, the problem resolves itself. Labels, dichotomies (dualities), and definitions prevent resolutions.
BY Uzoma Nwokorie
ON February 4, 2014 09:27 AM
This is a very insightful paper. Very rich in content. I love it
BY Dallas Crilley
ON March 8, 2014 04:22 PM
Today, I went to the beach with my kids. I found a sea shell and gave it to my 4 year old
daughter and said “You can hear the ocean if you put this to your ear.” She placed the shell to her ear and screamed.
There was a hermit crab inside and it pinched her ear.
She never wants to go back! LoL I know this is entirely
off topic but I had to tell someone!
BY Barbara Storper
ON September 19, 2014 11:24 PM
Loved the article. Wonder if there are folks out there who understand setting up a non-profit arm or turning one’s LLC into a non-profit? We are a national touring nutrition education theater company which creates and presents shows and resources to turn kids on to healthy habits. Schools and communities love our programs, evidence-based, award-winning, reached over 4,000,000 kids, but need more funding to help get program out to more schools. We’d appreciate it if someone out there understands these issues and would like to advise - thanks so much!
BY John Henderson, President
ON February 8, 2015 04:39 AM
Very insightful. A model we have under consideration for the purpose of cross-subsidizing some of our mission focused activities.
BY twin cities web design
ON March 28, 2015 06:27 AM
I read this article completely concerning the comparison of latest and preceding technologies, it’s remarkable article.
BY Akshat Singhal
ON June 7, 2015 10:09 AM
I am really surprised at myself to have bumped into this article 3 years after it got published. However, I am glad to read this up and to know that we are not the only ones solving the Hybrid Puzzle. Thanks to the authors for taking efforts to put this piece together. It will be great if the authors could come up with an updated version on this article especially since the dynamics of this space are changing everyday.
BY Jullian Regina
ON October 13, 2015 08:02 PM
I really think it’s ideas like this that are going to become the mainstream in 5 years time. The current model is outdated, every non-profit needs to be looking at a for-profit model of generating revenue. Social enterprise is the new reality. We’re trying to introduce classes on the very subject her in Canada. It’s the only sustainable way I see organizations to grow in the future.
Great read!!
BY cristina
ON November 20, 2015 02:43 AM
What about just setting up a business that create real value with care and respect of all the stakeholders and environments? Whay the impact has to be big? Can we think wall street as non profit organization? Sorry but I am idealist person and i like to indulge myself on absurd problems
BY Mark Metz
ON May 4, 2016 09:45 PM
This is remarkably helpful. For seven years I have been running a for-profit (S-Corp) publishing business with a social mission, (promotional services for mind-body movement educators, dance teachers, and somatic facilitators) and we have had a social mission from day one. After publishing a print magazine for several years called “Conscious Dancer” (our tagline is “movement for a better world”), and struggling with the business model of trying to be on the newstands and simply selling ads, I changed the model to a membership organization, and now we are called the Dance First Association. What we offer for money, (online promotional support and services for conscious movement facilitators) dovetails perfectly with our social mission, ie: more people dancing makes the world a better place, so helping dance teachers be more successful helps achieve this goal. I am currently in the process of expanding our business and broadening out our support structure by creating a hybrid, much like some of the businesses described in this article. A friend back used has a 501(c)(3) called the Fair Trade Foundation, and we’re looking at shifting 15% of the stock/equity in my S Corp. to become an asset of his nonprofit. So we are currently trying to figure out which activities fall under which umbrella, how the nonprofit will become the governing body in charge of the mission and vision, which way the funds will flow and how the activities will be contracted by the S Corp etc. We would like to host educational conferences under the nonprofit umbrella which would enable companies to be sponsors via tax deductable donations, as well as expand the revenue-generating activities on the for-profit side in order to fund scholarships and out reach for disadvantaged populations. I’d love to hear from anybody reading this who is interested and has insight into these sorts of evolving business structures. Thanking the authors for their great work here, and agreeing with the commentor above who pointed out the polarities that are unhelpful to the conversation. All in all a very valuable piece and I’m glad I ran across it while we are in the midst of figuring this out.
Mark (at) ConsciousDancer (dot) com
BY F. Hager
ON January 23, 2017 01:18 PM
Very remarkable article. Hard to believe, that hybrid organization will be mainstream soon.
BY Sudhir Shetty
ON August 6, 2020 02:40 PM
Your article has come across at a crucial juncture where i am about to launch my social-ecological venture but i could not figure how to reconcile the not-so conflicting goals of profit & social cause. I am not quite Indian legal-business recognizes hybrid models as yet. The Hybrid model representing a ‘Strong Sustainability’ aspects looks like has a promising future. Thanx