Steward Your Business Model

Leverage the For-Profit Model

The traditional model for organizations devoted to assisting social needs has been that of the non-profit, which is inherently dependent upon donations to survive. But what if there was a way to remove this dependency? In this post taken from the course, Social Entrepreneurship: Committed to the Needs of People, Will Haughey offers the for-profit model as a solution to this need and a creative way of leveraging the marketplace for the good of others.

Will is the Co-Founder and Chief "Blockhead" of Tegu, a toy company based out of Honduras that sells magnetized wooden block sets. He and his brother launched their business in 2006 out of a desire to help meet the needs of Honduran poverty. Since then, it has grown to support hundreds of employees and has been featured nationally on TODAYPeople Magazine, and The Oprah Magazine

From a business standpoint, there are two ways of approaching social needs. There is the non-profit model, which has plenty of advantages, but remains dependent upon annual donations and aid dollars. In contrast, the for-profit model creates jobs and wages making it self-sufficient once profit is achieved.

Will said, “Most of the time businesses are started where an entrepreneur or a visionary sees a need and addresses it with a solution or a product.” In what ways do you see your company contributing to the welfare of others? What are the needs it addresses?
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As Will observed, social entrepreneurship empowers people who have a vision for implementing ideas that address social/marketplace challenges. How does your business regard this type of creative vision? What opportunities do you have to empower the creativity of others in addressing the world's needs?
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For-profit businesses have the potential for self-sustainability, but also for leveraging the marketplace to address cultural problems, which places it in a unique position to impact the lives of people. In terms of its vision and mission, does your business consider the benefit of people in addition to generating profit? Why or why not? Depending on your answer, how do you think this motivates those within your company?
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Will warned against the temptation of being all things to all people. From a business standpoint, focusing solely on serving others may threaten the profit of both a company and its shareholders. In the same way, focusing solely on profit makes it difficult to show compassion. How does your company steward this tension between profit and compassion? How does it understand success?
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 The draw of the for-profit model is the potential sustainability it affords. As Will said, those who pursue this model will have to steward the tension of chasing both the success to survive as an organization and the compassion to care for society. Though you cannot be all things to all people, your work carries influence. Take small steps of faithfulness today in devoting your work to the service of others.

For more insights and teaching from Will Haughey, check out the full course, Social Entrepreneurship: Committed to the Needs of People.