Business and Society – The Ethics of Social Entrepreneurship

Business and Society – The Ethics of Social Entrepreneurship


Welcome to another program in our Business
and Society series. Our guests today are Dan Roselli from Packard
Place. He’s co-founder and Sara Garces Roselli also
co-founder of Packard Place so I get the idea that you two are connected some way or another. That’s true. I’m really excited about doing this program
in the Ethics of Social Entrepreneurship and is business up to the challenge I think that
is the title of our program or what we decided on and I was wondering for the benefit of
those of us and that includes me who really don’t understand what social entrepreneurship
is if you could better explain it and show us how it’s evidence perhaps in your own company
Packard Place. So, Dan would you like to start off? Sure and Rose thanks for having us. Oh, we’re happy about it, yes. Wonderful. Well, in its simplest form social entrepreneurship
are entrepreneurs but their companies have some social good component to what they do. There’s something positive that comes out
of what they’re doing. So, all entrepreneurs do good things because
they’re creating jobs but these companies have a specific focus on creating a good,
a specific mission for that. They’re described in a lot of different ways. Sometimes they’re called triple bottom line
companies. Sometimes they’re called social mission companies. Sometimes they’re called B-share companies. So, triple bottom line companies are based
on people, profits, or planets sometimes called sympositive social impact on that and I’ll
let Sara talk a little bit about Red F but for Packard Place it’s interesting because
it’s the uptown entrepreneurship center in uptown Charlotte. So, Packard Place is for-profit company but
part of what we do, we take the proceeds from Packard Place and it funds the non-profit
mission of a corporation we founded called the Garage at Packard Place which provides
help for entrepreneurs to get started, mentoring, support, co-chair space. So, it’s a balance of profit and positive
impact. Okay, well that makes me cheerful that it’s
just about profit but it’s about people. One of the things about Packard Place that
I think is really unique is that it is really designed to help entrepreneurs at a lot of
different levels so from the very point that they’re starting up their organization to
entrepreneurs that have a little bit more established company that are already very
interested in focusing on you know people and the planet in addition to making money. The other thing about social entrepreneurship
companies is that they can be for profit companies or they can be not for profit companies
Could you explain the difference between that? Well, for profit companies obviously are very
fundamental to our society. Large companies we all are familiar with are
like a Colgate or General Mills, Coca Cola, those are all for profit companies. Not for profit companies would be organizations
like United Way, Goodwill Industries, some hospitals. So, there’s a lot of different organizations
that focus on the greater good but in a way that they’re not making profit for themselves
necessarily not for a shareholder I see. I know both of you are very, very passionate
about social entrepreneurship and I wonder how you got passionate and didn’t just you
know blow it off or something like oh I’m not into that, Dan? Yes, for me I think part of that journey started
actually in my college experience. I actually went to Michigan State University
but I was able to join an organization there called Alpha Kappa Psi which is a co-ed business
fraternity that teaches business ethics and leadership to college students. There is actually a wonderful chapter of Alpha
Kappa Psi here at UNC Charlotte. There is. It is the largest international business fraternity
in the world. There are 220 chapters, hundreds of thousands
of members but it talks about being responsible business people that how we succeed is as
important as the fact that we do succeed. So, I think that really resonated with me
and formed, you know college are very formative years and that really kind of helped form
who I wanted to be as a business person. And for me, one of the reasons why I got to
be very passionate about this is because I spent most of my time after I graduated from
grad school working in large corporations. One of the things that I found very inspiring
about many of the companies was how much emphasis they put on a specific social mission that
was geared towards their brand necessarily. So, for example, like Colgate Palmolive I
spent some time working there. They have a program called bright smiles bright
futures where they help kids who don’t have access to dental care, you know proper oral
health in order to have good mouths essentially and to have good oral health for their overall
health in the long run and I always thought that was a really awesome idea and once I
became an entrepreneur, I thought how important it is to continue that philosophy in our own
organizations to actually focus on helping the people in our organization and people
outside of the company but at the same time giving back to the community in a way that
makes sense for us and for our associates and it’s one of the things that I’m passionate
about in every company that I’ve ever been a part of is to help advance the culture of
the company so that people in the organization feel passionate about something and it doesn’t
necessarily have to be what I’m passionate about but what they’re passionate about and
giving them an opportunity to have time away from work in some cases through paid volunteer
time so that they can spend time on their passion and give back to the community at
the same time. I know at UNC Charlotte the chancellor has
you know issued a paid leave to do volunteer work and so on and so forth. I think it’s a great idea. It’s very recent and I thought fine this is
a forward thinking and so on. Dan you seem to have had a special calling
to this endeavor. Could you tell us more about it? Yes so I think it’s interesting event to Sara
and I have found a number of companies, we always wanted to have companies that we were
really proud of and we would do employee surveys and one of the things we would say if I couldn’t
ask employees any other question, if I had to rely on just one question to ask them the
question would be are you proud to work here because if you’re proud to work here all of
the other fundamentals that are underneath it are probably taking care of themselves
and so for example the companies that we have founded even though we’re a smaller company,
we’ve always wanted our benefits to be in the top 10% of all benefits
You mean like health benefits? Health benefits, regardless of size right? That’s very unusual for a smaller company
to do employee matches on charitable contributions, to do matches on 401K plans which we still
do and didn’t cut during the great recession. Packard Place was interesting because Sara
and I had been and we worked very hard but we also have been very successful. The discussion we started to have was what
impact do we want to have of the community? What legacy do we want to leave? And I think for Sara and I Packard Place is
part of that. It’s doing something that we hope is hugely
positive for our community that wouldn’t have been done if we didn’t pick up the banner
and go do it. I think it’s a lot of what motivates us is
that we want to give back we want to have a positive impact and do it in a way where
we’re passionate about it and we’re probably uniquely qualified to go do it. Wow that really is heartening I mean inspiring
and so on. Sara you think that social entrepreneurship
is good for business; you think it’s good for capitalism and before the show I said
do you think it’s good for ethics. Spend a lot of time telling us all about that. Well one of the things that I think makes
it good for business is if you as an organization are able to talk to people about giving back
to society, that helps associates be very proud of the companies that they’re working
in but at the same time it creates an opportunity for companies to participate in sort of the
greater good if you will. A person that believes that you know that
our government cannot provide all of the resources and all of the infrastructure for our society
to be successful in the long run. I’m a big believer in the face that we need
to have public private partnerships and individual partnerships to do all of the things that
we aspire to do in this country and around the world and social entrepreneurs get that. They really understand that they need to not
only have a business model that’s successful but they need to do something to give back
to their internal associates and to their customers outside and on top of that how are
they doing something good in the community and there are lots of different examples of
companies that are doing that and that have been founded and started in order to give
back to the people and the planet and then obviously to their own pocketbooks in the
long run but in doing so they’re also being ethical business people because they care
about things that are beyond the almighty dollar if you will. You know, I was watching a series with my
son and my daughters that’s called �The Men Who Built America� on the History Channel
and one of the things that strikes me about Andrew Carnegie is that he realized at one
point in time that while he was a very wealthy man and he was making a lot of money that
that didn’t make him happy in the long run and it’s one of the reasons that he was driven
to start libraries in the United States for people to enjoy and basically created the
public library system in our country and so you think about an entrepreneur who took an
idea to give back and he created opportunities for people who couldn’t necessarily afford
books to further and advance their own education through reading and you know it seems like
a simple premise but without access to that could the greater population of the United
States have had access to all of the books that he had in his own personal library. So, that’s an example of an old time social
entrepreneurship example but I think it also transcended his own ethics because he had
had his own issues in his business life that weren’t so great and that helped to change
his image. Well, he was in the steel industry and he
didn’t always take care of his workers so there were high levels of injuries and things
like that and I think that that was something that bothered him in the long run. Whereas today, companies start from the fresh
perspective and they say okay how do we want to treat our associates and how do we want
to make money while we treat our associates well and be good stewards of our resources
and how do we work in the community to provide you know opportunities for individuals or
organizations like Packard Place where we’re trying to help entrepreneurs to advance their
businesses and grow so that they can then create jobs in the Charlotte marketplace. Which would be a great thing. We need them a lot. Now I want to go back to the point, Dan, where
you said you provide ample benefits for your employees. You know I find that interesting because of
all of the controversy that’s going on now about healthcare you know whether or not small
companies are really going to provide healthcare or whether they’re going to get out of the
healthcare business and not do it because it costs a lot. So, I find it very interesting that you’re
able to sustain a high level of benefits during this point of time. I mean some of the other companies say no
we don’t want to do it, obviously they’re not social entrepreneurship hasn’t hit their
consciousness yet. And I think there’s a balance there that Sara
was explaining too that historically people would say that you are a not for profit or
I’m a for profit capitalist and the only thing that matters to me is making as much money
as possible environment be darn, people be darn and I think what we’re realizing as society
becomes more global and we understand what’s going on there has to be a better balance
than that and that pure greed based capitalism won’t work but capitalism is the economic
engine that drives our country forward. Sara and I work extremely hard at our businesses. Our employees work extremely hard and they
run a very profitable company. That allows us to go do things like provide
them benefits. So, it’s a quid pro quo that yeah you have
to go run a good business that provides us the opportunity to do those types of things
for employees and they do it because they work hard at it. Right that goes back to your model are you
proud of who you work for and also are you happier working for us? Are you well treated? I would think if you were not well treated
you’re not going to work as hard. You’re going to find ways to pay the employer
back whichever way if it’s loafing on the job or that type of thing. Okay I’d like to get to more specific things
so our audience gets a better sense of what’s going on in Charlotte or even larger region. What are some of the companies in Charlotte
that you think are banner holders or social entrepreneurship and let’s understand a bit
why. So, maybe each of you have some examples. Yeah I do. There are a couple of umbrella organizations
that I would point to first. There’s a great organization here in Charlotte
called Queen City Forward which is an incubator just for social entrepreneurship companies. So, their mission is to help other social
entrepreneurship companies get started to make sure they’re on the right track, to provide
the mentorship and guidance and they have I think twenty or so companies under their
wing. There’s also an organization here called Social
Venture Partners. It’s for people who are trying to foster social
entrepreneurship companies. They run a program once a year competition
called Seed Twenty. It just happened about a month ago and the
second year they held the competition. All of those are social entrepreneurship companies
that are competing in order to get funding from Social Venture Partners and they held
the competition, twenty companies, all Charlotte based, all social entrepreneurs, just wonderful
companies in what they’re doing ranging from rehabilitating people who have criminal records
and are trying to be employed to fostering positive self-image for teenagers and youth
to how to regrow or use a grub to grub program where they’re actually growing food in the
food deserts in Charlotte. It’s the full spectrum of where somebody sees
a social problem and they do what entrepreneurs do and they think I can use my innovation
and my hard work and I think I can go solve that problem. It’s interesting to me before I go on to Sara
how companies choose their cause. I mean does that happen at the higher level? Does that percolate upwards? Who has the vision you know for one of these
endeavors? I think for most social entrepreneurs, it’s
very similar to a traditional entrepreneurship story. They’re consumers. They’re living in the world and they see something
that’s wrong and they say I know a better way to fix this. I can build a better mousetrap and I think
they’re called to want to have a more positive social impact and I think so the answer, it
comes from the founder which is they see something in their life an area that they know about
or something that’s moved them and saying I know I have a way of going and solving this. And I can get the capital or the money to
do it or something like that. That’s why those organizations are wonderful
Social Venture Partners and Queen City Forward as they help companies get the means to be
able to move forward on their leadership. Wonderful
But sometimes people don’t always have you know the personal financial resources to be
able to start something like that so they have to look to other places
And do you help them? And that’s the point of things like Seed Twenty
and Social Venture Partners and Queen City Forward is that they are there to help and
assist with you know trying to find access to capital, things like you know providing
mentorship and providing space resources and things like that. So, at Packard Place specifically we’re helping
with space as well as mentoring for people like that. But you know another great example of a social
entrepreneurship company here in Charlotte is Goodwill Industries. It’s sort of the quintessential social entrepreneurship
model and it was started a long, long time ago by an individual who saw people you know
waiting on breadlines and things like that and they didn’t have money to buy clothing
so he thought about wouldn’t it be interesting if people were to donate their clothing that
they couldn’t use anymore and then he started fixing it up and then reselling it to people
for a very low amount of money and in doing so he provided employment opportunities for
some people who were out of work and what that’s evolved to today is all of the Goodwill
stores that we all know and love and we donate to but what many people don’t realize is that
Goodwill’s primary mission isn’t a reseller of goods it’s to help people find employment
opportunities who are either they may have been in prison, they may just be unemployed,
they may have come upon hard times. Goodwill’s mission is really to help people
find jobs and it’s through the power of work that Goodwill is successful. It’s so fascinating to me to see that organization
succeed really on its own because the money that they make in the stores provides the
resources for them to be able to provide job creation programs. Oh, I never knew that. That’s a really terrific explanation of Goodwill. Let me add one thing to that because I think
Sara hit on an interesting point of the difference between a charity and a social entrepreneur. A charity relies on donations and other things
to support it. Social entrepreneurs create a viable, sustainable
business model doing positive good like Goodwill Industries does get some support but it’s
cool they have a business model that works. That generates revenue for them to fulfill
their mission of job retreating and skill enhancement and that’s the difference between
an entrepreneur and a charity. That’s helpful. You know another thing I was going to ask
you two is do you have any people you look up to as heroes or heroines here in Charlotte
when it comes to this? Dan? Certainly, you could almost take any company
in Queen City Forward or in the Seed Twenty competition I just think they’re marvelous
people. I remember sitting in the Seed Twenty competition
this year and company after company, founder after founder coming up and it will make you
pause and say there’s something I’m just not doing enough because they are wonderful companies
but one on the national scale that sometimes gets left out too often too is Newman’s Own. I remember Paul Newman twenty or thirty years
ago was way ahead of his time before social entrepreneurship was even a concept said I
can take some of this Hollywood fame that maybe I don’t deserve or came to me by accident
and I can go create a company which will over time has given millions of dollars in benefits
back to people and you look at how Hollywood celebrities or other people use their fame
in different ways and in arguably less productive ways for society and I think he’s been a great
role model for decades on how to use his positive influence on a social entrepreneurship company,
how to use his likeness to drive that forward. Yeah I greatly admire him too. Sara? I was going to say not necessarily specifically
in Charlotte but it has come to Charlotte finally at the end of last year is a company
called Grameen America. Oh, I’ve heard of it. Which my hero there is Muhammad Yunus who
started the Grameen Bank internationally and then he asked the question could this model
that I’ve started around the globe be replicated here in the United States and low and behold
he was able to replicate that model and started in New York City with lending small amounts
of money to underprivileged basically very poor people who had a business idea but had
no access to capital and through giving them those loans they have been able to have seed
money to start their businesses. Most of them are lifestyle businesses. Some of them are not, but those individuals
now have a way to provide a path out of poverty which is something that our system doesn’t
necessarily provide for people and the most amazing thing is is that at the end of last
year, we opened a Grameen America branch here in Charlotte. So, Charlotte now has about 90 individuals
in the Grameen America Charlotte branch who are benefitting from loans and financial education
and who are starting their business here right in the Queen city and the thing about Grameen
America that I think is similar to Goodwill is that again it’s an organization that is
sustained through the loans that are provided, the interest that is paid back on those loans
is used to continue to give more loans to more and more and more individuals. It’s a model that is sustained within itself
and it does not rely on lots of external donations to keep itself going. I have a question to ask about Grameen. Didn’t it first start out internationally? It did, yes. It started in Bangladesh and Muhammad Yunus
studied here in the United States and he went to Bangladesh which is his home country and
there were several women in a village that were talking about wanting to be more efficient
in whatever business that they were doing and he had an idea. He said, I wonder if you know I were to give
them, I think it was like fifty dollars to start with. Microloans. Right, it is all about microloans. So, he gave a few women a very small amount
of money and he found that they repaid the money dollar for dollar one hundred percent
back to him and then they proceeded to borrow more money and they were able to grow their
businesses to the point where today many of those women are able to send their daughters
and sons to school where they couldn’t before or they are building schools in their own
communities because they now have the resources to do that, they’re creating jobs for other
people in the community through some of their businesses and it’s an amazing model that
kind of starts with one and then goes out into the community and creates many, many
opportunities for people from just one person getting a loan. Well, that goes back to what you were saying
that government may not be always the solution that business is a large part of the solution. I mean that model is incredible I mean one
person. What kind of businesses were these women in? Here in the United States, most of them are
doing things like they have baking businesses, they might be seamstresses, they might be
using a talent that they have in weaving or jewelry making or something like that and
then selling their products. Some of them do hairstyling, provide in-home
child care businesses, lots of different types of things like that and the beneficiaries
of Grameen America are primarily women at this point. There are some men. It’s sort of a feminist cause or a women’s
cause and I’m very interested in that so I’m glad you mentioned Grameen. I’m glad you mentioned the other companies
too. If we wanted to leave a little message to
our audience, what would your message be Dan? I think it’s to try to get involved in some
of these social entrepreneurship companies. When you think of Grameen America or you think
of the work that Queen City Forward is doing or Social Venture Partners that we’ve talked
about or Goodwill that by putting money in it becomes a self-fulfilling virtuous cycle. That ten dollars you put in not only gets
paid back but becomes more money and I think sometimes people get overwhelmed with the
concept of oh my gosh how do I get involved I would encourage everyone to even do one
small thing. Come to the Seed Twenty competition this year. If that’s all you did, spend an evening, bring
your kids, come to the competition and listen to what’s happening. You don’t need to go radically change your
lifestyle, just take one positive step forward in helping social entrepreneurship in Charlotte. Sara? I would say that people need to remember that
there is tremendous power in one. There is always power in many but if each
one of us don’t take action in some way from a social perspective whether you become an
entrepreneur or not, we are losing an opportunity to make an impact and a difference in our
society and if we can set an example as an individual then others will be inspired by
the things that we do and may take initiative to do the same and I think that’s one of the
things that we have tried to do is to just to inspire others to engage in their community
in whatever way they have capacity to do so. So, small is good? Small is good. And you really can make a difference. Some students say oh well I can’t make a difference,
you’re message to them is oh yes you can and it just takes one activity to do so. So, if you had a say, you gave an example
of going to the Seed Program, do you have an example of what like I could do? I think even something as simple as when you
clean out your house remembering that Goodwill is there and that your donations to them are
providing job opportunities or if it’s when the boy scouts some and ask you for food for
second harvest to remember that there is an opportunity to help a social venture succeed
because there are people out in the community who care and are willing to come to your door
step to collect the food or resell the donations so that they can do greater good so you know
even simple things like recycling can help the greater society. Yeah we’ve gotten better about recycling. We go the message that you can do that it’s
not hard it’s easy you know just separate the stuff out and I’m proud of us for finally
doing that. We were very negligent before. Well I can’t tell you how much we enjoyed
having both of you on the program today. I really feel like I learned a lot and I’m
glad that Packard Place is here in Charlotte doing so much good and I hope you have a very,
very successful future and you bloom and grow and everybody knows you in five years from
now. Thank you. Thank you. Thank you. Thank you, it was good to be here.

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