NEWSSOCIAL INVESTMENT

"What, after all, has maintained the human race on this old globe despite all the calamities of nature and all the tragic failings of mankind, if not faith in new possibilities and courage to advocate them."

-Jane Addams

After two wonderful years, we're formally announcing that there will be no more regular posting on the Social Entrepreneurship blog on Change.org. It's been quite a ride.

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About half way through college, I began to hear a new term all around me. It was "social entrepreneurship," and the idea, at least according to this book "How to Change the World," that everyone was reading, was that there was a new group of changemakers who were not wedded to the dogma of the past and were finding innovative ways to combine business and nonprofit know-how to tackle the world's biggest challenges.

The concept was like a brilliant spark for many of my peers. We were part of an incredibly lucky group who had had the chance to see the world up close much earlier than generations before us. Social entrepreneurship felt like an approach to change that could learn from the failures and successes of past development strategies to create something more scalable and more sustainable.

Of course, social entrepreneurship was not, in 2004, new. The field had decades of history, and heroes who were building an infrastructure long before there were any cover stories to reward them. But if the groundwork was laid in the past, it is in the last half decade that the field has really come into its own.

For the last two years, this blog has been covering the accelerating cultural importance of "social entrepreneurship." We've covered the brilliant innovators who are reshaping fields as diverse as health and access to finance. We've looked at the trends shaping investment and the development of new metrics. We've watched the Obama administration's foray into the social innovation space. And we've always tried to cover the critics and skeptics who wonder about the hype and efficacy of this nascent movement.

If one theme has stood out more clearly than any, it is just how young the field remains. However exciting or alluring it seems in print, the social entrepreneurship space is growing in fits, kicks, false starts, flops, failures, and improbable successes. It is messy, chaotic, incomplete, and still wonderfully full of possibility.

One of the joys of covering the field from Change.org has been that this company is, itself, an embodiment of the challenges and opportunities of startup social ventures. What began as a Facebook for social change advocates evolved into a media hub for important causes and continues to develop as a platform to coordinate the most important collective action campaigns in the world.

Over the next few months, Change.org will be increasingly focused on its mission of channeling people into high-impact collective action campaigns. We've seen how powerful it can be to get 1,000 people to email a local mayor or business, and learned how to help our readers enact change in real time. Yet with this evolution, the time is right to refocus on actions and specific cause areas, and end our more general coverage of the social entrepreneurship field.

There is still much to accomplish in this movement. While I've loved working with our writing staff to build this community, my belief is that to truly unleash the power latent in the growing network of social entrepreneurs, we need better tools to help people harness their social capital.

My full time focus will be on building Assetmap, a platform designed to transform the way individuals and teams use the resources in their networks to support one another. I'll be moving my writing under the company blog, and covering topics like social capital, the psychology of teams and giving, and more.

I believe wholly and absolutely that we've barely scratched the surface of the importance of social entrepreneurship. This field carries with it not simply innovative organizations, but also an entirely new way of conceptualizing value and organizing business and society. For champions of a world in which companies and nonprofits are partners in enabling equality, opportunity, and human rights, our story is just beginning and time is on our side.

I'm glad to have spent the last two years sharing some parts of that story with this community of readers, and I can't wait to see what the future will hold. Thanks to all the writers and Change.org staff who have made this journey possible.

To follow my next steps, visit http://blog.assetmap.com or sign up to be the first to know when Assetmap is available.

(Ed. note: This is a guest post by Yury Lifshits. Yury is a Research Scientist at Yahoo who has done extensive research into market models. We're thrilled to republish this piece on the changing nature of public goods, which was originally published on his blog).

There is a new trend in the tech industry: making money on public goods. Until recently, public goods were viewed as an area of philanthropy. Now entrepreneurs, investors and corporate leaders see the business opportunity there. This essay gives a basic tour around the market of public goods. We cover the definition, core business models and future areas of growth.

What is a public good?

One can classify goods by the following two criteria: rivalry and excludability. A good is rival if its usage by one consumer reduces availability to others. In contrast, non-rival good can be used by every consumer in parallel. If a producer manages access for every user individually, the good is called excludable. Non-excludable goods are available for everyone interested. Thus, we get four groups of goods:

• Private good (rival and excludable): iPhone, Toyota Prius.
• Common-pool good (rival and non-excludable): Customer support, water in a river, conference rooms in an office building.
• Club good (non-rival and excludable): Cable television, Windows 7.
• Public good (non-rival and non-excludable): National defense, roads (excepting toll roads), GPS Satellites, Wikipedia.

In this essay we use the term public goods more broadly than in classic economics settings. Namely, we consider voluntarily non-excluded goods and nonrival-before-congestion goods to be public. Public goods are produced in a number of areas: city infrastructure, education, law enforcement, peace, safety/security, energy, environment, health, food safety, social security, employment, transportation, tourism, mass communications, and financial systems. In this essay we will have a look at the concept of public goods enterprise (PGE) - an organization that produces non-rival non-excludable goods at profit.

The conference is the tip of the PopTech iceberg, and what lies under the surface is a series of "unconventional collaborations" in which the organization staff find creative ways to bring dissimilar and disparate actors together in order to see how their different perspectives and resources can amplify and augment one another. They've announced two more of their collaborations during the event, demonstrating some of the best experimental impulses of the network.

PeaceTXT: Violence is rampant in urban areas like Chicago. A few years ago, epidemiologist Gary Slutkin began to wonder if the spread of violence looked like (and could be stopped in similar ways to) the spread of infectious diseases. The result was an organization called CeaseFire, which uses a network of community members as "violence interrupters." These community members are usually people with a sorted past who have seen the long-term results of violence, and can speak from experience that it just isn't worth it. The organization has produced amazing results, reducing homicides in some places by more than 75%.

The challenge for CeaseFire is to figure out how to meet the incredible demand for their services, successfully scale up, and even think about how to apply their model in new settings, such as combatting international terrorism. To explore whether there is a technology opportunity to help them, PopTech connected CeaseFire with the folks behind FrontlineSMS and Ushahidi. The teams have spent the last few months getting to know one another and brainstorming ways that technology can improve CeaseFire's work. If they figure something out, it would truly be a radical collaboration -- CeaseFire could hardly be more focused on real, local relationships and credibility.

Own Your Future: Again coming out of the PopTech Accelerator program and anchored by organizations from the Social Innovation Fellows program, Own Your Future is a collaboration between PopTech and the Brooklyn Community Arts and Media (BCAM) high school. BCAM is a highly innovative school that uses creativity and digital multimedia to engage students in a more significant way.

Own Your Future is a program that will help students make money from the creative works they produce. While the exact mechanisms haven't been figured out yet, the core of the program will be a one year experience that includes entrepreneurship training and financial literacy. Money that students make from their works will be put in savings accounts that they gain access to upon graduation.

These sort of collaborations are the hallmark of the PopTech network. I think both of them have huge potential not just for the actors involved, but as demonstrations of broader opportunities.

Photo credit: kk+

One of the central questions in the growth of the field of social entrepreneurship is whether the term and framework of "social entrepreneurship" will persist, or whether we will look back and see it instead as an intellectual and organizational movement that influenced other fields without becoming one on its own. The annual PopTech conference in Camden, Maine suggests that the question might be a "both/and" rather than an "and/or".

PopTech is a network of cross-disciplinary thinkers and doers with a creative problem solving and social innovation. Throughout the year, PopTech convenes actors from different fields to work together on significant challenges, and the community is anchored by their annual conference in Camden, Maine.

The conference, which I'm attending this week, runs four days and is replete with talks, performances, and unexpected social encounters. While content appears king from the outside, however, the conference is also the seat for two of the most innovative parts of the PopTech platform, their Social Innovation Fellows program and their Science and Public Leadership Fellows program, a new partnership designed to help give brilliant scientists the media chops and savvy they need to better share their work with the public at large.

The Social Innovation Fellows program is in its third year, and is distinguished by the seriousness of its curricular program. For a full week before the larger conference begins, the selected entrepreneurs live in Camden and receive basically nonstop training, mentorship and support from designers, public speaking experts, social impact measurement folks, and more. The program has included social ventures like Global Citizen Year, Ushahidi, FrontlineSMS, and Samasource.

In many ways, the program demonstrates why having a "social entrepreneurship" field is so valuable. The projects represent an extremely diverse set of problems and approaches to change, but benefit from a curriculum that is overarching and reflects the needs of early stage socially focused ventures.

Yet at the same time, what happens after the Fellows program ends shows why the social entrepreneurship field shouldn't shirk it's overlap and potentials to integrate with the larger fields of business and science. Throughout the four days of he Maine conference, the Fellows give five minute presentations to the entire audience which end up being some of the best content of the event. This sparks conversations and partnerships with senior execs at well established companies that simply wouldn't come from an event purely focused on social entrepreneurship.

The lesson, I think, is that the field is young, but perhaps at the exciting moment where its beginning to have enough of sense of itself that it can interact with the larger fields that drive business and society, not with fear of assimilation but of excitement of mutual influence.

Photos: whiteafrican

I went to Opportunity Collaboration skeptical. Why was a conference on poverty alleviation being held at a beach resort in Mexico?

I left Opportunity Collaboration on Tuesday morning in awe of what the conference had accomplished. It was a rare masterpiece of an ‘unconference’, organized by Jonathan Lewis of MicroCredit Enterprises, and put on by COO Topher Wilkins with the help of quite a strong team of volunteers.

While I would rather have been less separated from the local communities of Ixtapa and Zihuatanejo, Mexico, I must admit the setting did serve the purpose of allowing the 300 attendees to connect deeply in a relaxed environment. Further, the conference with the help of I-DEV International did make an effort to connect to local Ixtapa area social entrepreneurs by hosting a work session to create a debt fund to support their growth.

The attendees, called “delegates”, were a mix of entrepreneurs, social entrepreneurs, investors, foundation directors, and non-profit directors. The conference also welcomed fifty Cordes Fellows which greatly added to the age and geographic diversity of the crowd.

The conference ran from Friday night through Tuesday night. I left Tuesday morning to get back to iContact as we have a very big week getting ready to move 235 team members this Friday to our new offices in Morrisville.

The schedule for each day looked something like:

• 8am – Swim in Pacific/Breakfast
• 9am – Colloquium for the Common Good (Discussion on a Reading in a Group of 25)
• 11am – Open (we used it to convene a group of millennial social entrepreneurs each day)
• 12pm – Lunch, with breakout groups called cluster forks
• 1:30pm – Wellness time - Soccer, kayaking, volleyball, sailing, archery
• 3pm – Collaboration Challenge (topical discussions)
• 5:30pm – Open for 1-1 meetings
• 6:30pm – Dinner, with breakout groups called cluster forks
• 8:30pm – Companies and Causes - 60 Second Pitch Session
• 10:00pm – Networking on the Deck

There were no panels and no keynotes. This led to people having the time to connect in deep conversations. It was one of the more enjoyable long weekends I can remember in my 26 years of life. Having the opportunity to engage deeply with some of the most innovative practitioners in the field of poverty alleviation and social entrepreneurship was immensely inspiring and beneficial.

Being laser-focused on getting iContact to an IPO in the next couple years and now having a great staff who can attend our 25 or so company trade shows each year, I've scaled back the number of conferences I attend in the past couple years. I tend to limit it to Summit Series, the Skoll World Forum, Renaissance Weekend, and a couple investment bank or analyst conferences per year. I will now add Opportunity Collaboration to the select annual list.

Why Did I Choose to Come?

OppColl was talked about heavily when I was at the Skoll World Forum in Oxford in April and came recommended to me by people whose opinion I trust--Nathaniel Whittemore of Assetmap, Kim Scheinberg of Presumed Abundance, Jonny Dorsey of Global Health Corps, Mike Del Ponte of SparkSeed and Ben Abram of Westly Group. And so I signed up, not really knowing what would come of it.

My interest in being at OppColl was four-fold.

• Vacation & Strategic Reflection: After working non-stop since February on our $40M Series B fundraise at iContact it was good to take three days off for a mini-vacation. Any time I can get out of my normal environment I find I can think more clearly about our strategy and get a big picture perspective. It turned out to be quite a valuable experience just from an iContact perspective, as there were a number of deep discussions on leadership I gained from and I wonderfully ran into at least ten of our customers who I always love connecting with about what they think about our company and product and what their additional needs are.
• A Passion for Ending Extreme Poverty: A large part of my interest in attending goes back to a lifelong passion I have of wanting to be part of a generational movement to end extreme poverty in our lifetimes and learn all I can about the topic. In a world with so much, it just does not make sense that 2.5 billion people live on under $2 per day and 22,000 children five or younger die every day in the developing world—most needlessly from preventable disease and starvation. I think I can make the biggest difference in extreme poverty in the mid-term via investing and private-sector job creation, but I'm very aware that it requires all three sectors (government, business, and civil sector) to work together. To actually create sustainable economic development the trifecta of transparent, non-corrupt, responsible, and well-run government, civil sector (NGOs/NPOs), and businesses must exist. OppColl does a great job of bringing together folks from all three sectors to collaborate.
• Nourish International: The non-profit organization for which I serve as Board Chairman, Nourish International, is at an important point in its history. It is transitioning from a completely donor-reliant model to a more sustainable model that includes a portion of its revenue from earned income. I came to connect to other non-profit directors and board members that have successfully created substantial earned income models for their organizations.
• Humanity Fund: I launched a small personal investment fund called the Humanity Fund in January. Going to OppColl was perhaps the easiest way to connect directly with the leaders of the microequity field. Through the Humanity Fund we invest $10k to $100k at a time in socially responsible high-growth for-profit businesses in Africa, Latin America, and the USA. This is a small effort for now in which I want to dip my toes into the water and make a couple investments per year as a way of gaining some learning lessons, getting exposure to high-growth businesses in “frontier markets” and investing in creating jobs in high-growth socially responsible businesses that are growing quickly. My hope over time is to show that it is very possible with the right structure, even with the challenges of transaction costs, trust, and liquidity, to achieve above-market returns by investing in microequity and investing in the missing-middle of SME financing in which growth capital simply is not presently available.

The People

Of the 300 delegates, the folks I spent the most time with at the conference were:

• Ben Abrams, Westly Group and FACE AIDS Board Member
• Jonny Dorsey, Global Health Corp
• Mike Del Ponte, Sparkseed
• Michael Wenger, OpenAction
• Saul Garlick, ThinkImpact
• Salif and Mohammed Niang, Malo Traders
• Abby Falik, Global Citizen Year
• Elizabeth Dearborn Davis, Akilah Institute for Women Rwanda
• Leticia Jauregui Casanueva, CREA
• Katie Drasser, UCSF Global Health Group
• Wiclif Odongo, Kito International
• TJ Cook, High Def Web Solutions
• Mia Divecha - Stanford Talisman
• Amity Weiss, Rwanda Nziza
• Marina Kim, Ashoka
• Mark Hanis, Genocide Intervention Network
• Asher Hasan, Naya Jeevan
• Chet Tchozewski, Global GreenGrants Fund

I already have a sense a number of these will turn into lifelong friendships.

I also connected with some key people in the emerging and fascinating field of microequity and impact investing:

• Brian Milder, Root Capital
• Lewis Hower, Unitus Equity Fund
• Harold Rosen, Grassroots Business Fund
• Gerhard Pries, Sarona Asset Management
• Keely Stevenson, Bamboo Finance
• Bob Freling, Solar Electric Light Fund
• Diane Calvey, Village Enterprise Fund
• Jan Pearcy, ShoreBank
• Bob Patillo, GrayGhost Ventures
• Ron Boehm, Boehm-Gladen Foundation

I was also particularly impressed by the economic potential (in addition to the social impact) of ventures of:

• Wello Water Wheel
• Dream & Achieve - Afghan Reality TV Show
• OpenAction

The Colloquium for the Common Good

The morning "Colloquium for the Common Good" offered an opportunity to connect deeply with a group 25-30 randomly selected delegates through two hours of discussion on a set of readings related to poverty alleviation (though I must admit I still struggle to understand why we were asked to read Antigone for day two). Our colloquium group was moderated by the well-known photographer Paola Gianturco. On the Saturday night a group of the millennial generation social entrepreneurs decided to have an ad hoc "indigenous community cultural immersion exercise" and went dancing in Ixtapa for a few hours so I regrettably missed out on the Sunday morning discussion of Antigone.

The readings for the Colloquium included:

• A Letter from Birmingham Jail by Martin Luther King, Jr.
• The Brothers Grimm, “The Wonderful Musician” (story)
• Antigone (play)
• Virginia Woolf, Three Guineas (essay selection)
• Frantz Fanon, “On Violence in the International Context”, from The Wretched of the Earth (essay)
• Hernando de Soto, “By Way of Conclusion,” from The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else (chapter from study)
• H.D. Thoreau, “Economy,” selections from Walden (essay)

The Millennial Social Entrepreneurs

We used the 11am hour two of the days to convene a group of younger entrepreneurs and social entrepreneurs to mind-map out on a whiteboard what we are currently doing to be part of ending extreme poverty. Then we shared our plans for scaling our impact over the next four decades and being part of the global movement to actually end extreme poverty by 2050. This was perhaps the hour of discussion I most looked forward to each day. Being able to map out the role I hope to play and gain feedback and go deep with Saul Garlick of ThinkImpact, Jonny Dorsey of Global Health Corps, Mark Hanis of the Genocide Intervention Network, Ben Abrams of Westly Group, Asher Hasan of Naya Jeevan, Leticia Casanueva of CREA, Amity Weiss of Rwanda Nziza, Mohamed Ali Niang of Malo Traders, and Elizabeth Dearborn Davis of Akilah Institute was intriguing and energizing.

Lunch & Wellness Time

Lunch provided ample opportunity to join a breakout "clusterfork" or have 1-1 meetings with other delegates. Example Cluster Fork topics included:

• Do Gooders With Spreadsheets
• Building Wealth and Assets Across Borders
• Money and Power for the World's Poorest Women Through Savings
• Impact Investors: Get More Deal Flow
• Preparing the Next Gen Global Leaders

After lunch we had time to relax or exercise. Having 90 minutes built in each day for "wellness" was unique and much appreciated for a conference. I kayaked, played soccer, swam, and even trapezed during this time.

Collaboration Challenges

The 3pm sessions convened groups of 30-40 in a chair-circle format to discuss a particular topic. My favorite "Collaboration Challenge" was the Millennial Social Entrepreneur themed session on Monday, particularly when we split off into a group to discuss for-profit social entrepreneurship and how to use the great power of markets and investment capital to increase social impact.

Some folks in the room thought that by definition you couldn't be a social entrepreneur if you ran a for-profit business. No consensus from the group emerged, but I along with others made every effort to make the point that the entrepreneur who runs a socially responsible enterprise, regardless of entity structure, is a social entrepreneur. Personally, I define a social entrepreneur as a "problem solver who takes action." To me, there are for-profit social entrepreneurs and non-profit social entrepreneurs and in some cases you can actually make a larger social impact by choosing to organize as a for-profit and be able to access capital and talent markets more effectively.

• Example topics for Collaboration Challenges included:
• Profits and Pitfalls in Social Investing
• Fattening Up the Food Supply
• Jobs at the Base of the Pyramid
• Poverty and Pollution: The Poisonous Paid
• Conscience of a Capitalist

Companies & Causes

Finally, each night after dinner was capped off by "Companies and Causes" a 60-second pitch session run by R. Paul Herman, author of HIP Investor. Perhaps 40 of the attendees pitched each night.

These pitches were generally good, with the sole exception of the unfortunate rule that if you combined into a larger group you would get as much as 3 minutes each instead of 1 minute. This caused the room to lose energy and the hour long pitch session to go 90-100 minutes, beyond the interest of most attendees who ended up hanging out instead in the adjacent bar. Overall, "Companies and Causes" was a great new addition to the conference, however I'd recommend keeping every pitch to 60-75 seconds next year. Less truly can be more.

Each night seemed to end with a spontaneous group of 20 and 30-somethings swimming in the Pacific.

So Should You Go to OppColl Next Year?

And so, if you're working in the field of social entrepreneurship broadly defined, are interested in meeting the CEOs of entrepreneurial ventures that have a huge potential for both financial and social return, care deeply about humanity, or care deeply about actually ending extreme poverty in our lifetimes, Opportunity Collaboration is probably the best conference to come to for the deep relationships it affords. It is not the best conference for content or big-name speakers--the Skoll World Forum on Social Entrepreneurship is much better for that--but it is the best conference I've been to for facilitating the creation of deep, meaningful, beneficial relationships that can help both parties make an increased positive impact in the world. The conference is not inexpensive, so if funding is an issue be sure to apply early for a 2011 Cordes Fellowship.

Hope to see you there in 2011!

Were you there? What were your experiences? Do you wish you were? Is it justifiable to have an expensive conference on poverty alleviation at a resort if it brings great people together who in fact due to the connections they make are able to more effectively scale their social impact and more quickly end extreme poverty? We'd love your comments.

Photo credit: Jake Putnam

I try not to consume much, but when I do, I like to buy products that make me feel morally superior. Chances are, you do too. Right? My point is not that we're better than everyone else and therefore have the right to be smug (even if we do); my point is that there is an obvious niche market for consumers who pay close attention to where their goods come from and where they can go when they're done with them. But do these companies have--either an externally imposed or internally genuine--moral obligation to the greater good?

Mark Dwight, Founder and CEO of Rickshaw Bagworks says yes. He left his last company when he told the Board that they had a moral imperative to stop using PVC. They disagreed. So he started a competing company that doesn't compromise on that value and leads by example in many other ways such as manufacturing quality products in the USA. They meet their bottom line through innovation and embrace their-self imposed limitations as part of their business culture. I recently met Dwight and other environmental leaders at the Opportunity Green Conference and Dwight's comments were a springboard for others in the field.

If there is a moral obligation to innovate, is there also a moral obligation to be philanthropic? Rick Ridgeway of Patagonia used similar language as Dwight: "We have a moral obligation to do our penance as a company...business is harmful to the environment; we are morally obligated to mitigate that harm." As a member of 1% for the Planet, Patagonia has donated over $40M to environmental nonprofits and has become an icon among sustainable companies.

The next question: is it more important to be sustainably innovative or philanthropic? In 1993, New Belgium Brewing Company was giving away$1 for every barrel of beer sold. They asked themselves, as Jennifer Orgolini recalls, "Should we give that much? Should we keep more for greening our own operations?" The company decided that their dollars could be effectively used in both ways. Some environmental progress is better done by nonprofits and the world needs both innovative companies and funding for grassroots environmental efforts.

It's an important distinction that companies do need to be both leading by example and giving to organizations that can do other things better than they can. A coal mine giving away money to a land trust is different than a sustainably-minded company supporting causes that extend their values. Of course, it is in these company's best interests to support environmental nonprofits: Patagonia's customers won't have anywhere to use their gear if their favorite mountain trail becomes a housing subdivision and New Belgium acknowledges that "no fresh water means no great beer." There's nothing wrong with a symbiotic relationship.

The fact that environmentalists are using words like "penance" and "moral" is fascinating. I emerged from an evangelical Christian background. In that culture, the prevailing view--not held by everyone of course--is basically that God created the Earth and then created humans to dominate it; we're going to die and go to heaven so why should we care what happens on this planet after that? That's God's problem to save us from. I don't like that the Religious Right has commandeered certain words and concepts. I like being reminded that morals are not just about personal choices like not having sex before marriage; they are about choices to do the right thing for the greater good. (And on a sarcastic note, it gives me a broader platform from which my smugness can emanate.)

Photo Credit: Kerri Feazell

I recently spent two days at the Opportunity Green Conference in LA where I was immersed in conversations about sustainable business. One panel, Accelerating Green Product Innovation, provided interesting examples of innovation in businesses from entrepreneurs in various stages: from pre-launch (Replenish), to firmly-footed (Rickshaw Bagworks) to household name (Coca-Cola).

Innovation Principle #1: Limitation Inspires Innovation
Jason Foster, founder and CEO of Replenish had a crazy idea: "Let's build products that are designed for re-use." In a consumer society where items are purposely manufactured for a short life-span, this is an innovation. (Side note, if you haven't seen The Story of Stuff, it's well-worth 20 minutes of your time.) Foster's innovative design for cleaning products reduces plastic by 90% and costs 50% less than competitors. They knew they could reach that goal but in designing their product, they encountered some challenges to their ideals. Making their product in PET (easily recycled material), proved a challenge within the existing manufacturing infrastructure. But they stuck to their principles and in the end, Foster was grateful for the limited options that gave some direction to their design--the limitations actually inspired greater innovation.

Innovation Principle #2: Good Ideas Spread
Panelist Mark Dwight, Founder and CEO of Rickshaw Bagworks, started the company with old-fashioned values that made the now-moguls what they are decades ago: pay attention to form, function, and footprint. As a small business, Rickshaw's innovations have even attracted mega companies to adopt some of their practices. For example, Rickshaw's practice of shipping their products to customers in bags that can be re-used for returns if needed caught the attention of ebay. It's encouraging to see larger companies asking start-ups how to innovate and to see start-ups sharing those ideas for the greater good.

Innovation Principle #3: Maybe Recycling is Better than Re-Creation
When big companies do take the lead with innovation, their investment in research can have immense impact. Panelist Gopal Kishnan, Senior Director of Global Marketing Innovation and New Categories for The Coca-Cola Company talked about Coke's new PlantBottle. It's made with up to 30% plant-based material (sugar cane) and can be recycled just like any PET material.  I would like to see more research on this, but Gopal explained that they created the PlantBottle as a material that can be recycled rather than composted because the energy required to create a new bottle is less than is required to recycle the bottle in to new material. I want to see a PlantBottle that could go either way but in the meantime, this is challenging me to rethink some of my assumptions.

The idealist in me was reminded of an important underlying idea key to innovation. During the Q and A, a participant asked, “Do you wait until the design is perfect?” and Dwight answered, “Iteration is the key to innovation, and perfection is the enemy of progress. Sustainability is a journey. Don’t wait for perfection. There is no 'perfect' product.”

Photo credit: opportunitygreen

Entrepreneurs are best at finding innovative solutions to serious problems. Environmental problems are arguably the root of all social ills and it's exciting to see social entrepreneurs take on the challenge. The 2nd annual OG25 Green Business Startup Competition included 25 finalists ranging from a company redefining the off-shore energy market (wind farms!), to smart sprinkler systems, and a social network for the eco-mom.

The winner of the competition was Zimride, a "rideshare service [that] helps organizations establish easy to use, private, social networks for ridesharing." One of the company's unique angles is to use networks like college campuses and companies to arrange rideshares in "trusted communities," allowing members to search and post ride options including personal cars, shuttles, vanpool, and zipcar. It's also marketed for events (so perhaps the line to get in to Burning Man next year will be 7 hours and not 8 if enough people try it?) Already in use at UCLA, Stanford, University of Michigan, and USC, Zimride has proven to engage 10-20% of student populations and integrates with facebook and Twitter. Since I don't have a car and I'm not part of a campus or corporate network, I'm planning to test out their free public rideshare option, which is (probably) safer than hitchhiking and faster than the bus.

These finalists also caught my eye:

• Airbnb is an upgraded version of couch surfing that matches private residences with travelers. A friend of mine recently used the service to stay in a mountain-top vineyard cottage with an ocean view. I intend to advertise my less exotic, but just as friendly, couch and air mattress in my living room if you ever need a place to stay in LA.
• ecoATM is an "automated eCycling station." In my experience, most ewaste recycling centers do not currently have the capacity to provide convenient drop offs. This solves the problem: how should I dispose of my broken phone charger after 5 p.m. (that was intentionally built to last no longer than 5 years so I'll buy another one) and get money for it?
• GoodGuide, Inc. rates over 65,000 non-toxic and environmentally-friendly products and helped me determine that there is a better toothpaste than the one I'm currently using (but mine is second best). Also, the company is a B Corporation.
• Soleo Organics makes the highest rated sunscreen by the Environmental Working Group. I tried it this weekend for several hours in the intense LA sun and I was well-protected.
• ThinkEco makes a product they've coined the "modlet" for "modern electrical outlet". Plug your electronics into the modlet and "then use your web browser to wirelessly monitor and manage your power consumption." It should save you 10-20% on your electricity bill.

The conference also hosted a Green Product Design Competition. All 50 companies/products are worth a review for inspiration to all you social entrepreneurs out there. I'll say it again: You are the best at finding solutions where others see problems. You thrive on it. So go, create, and introduce yourself to me at next year's OG25.

Photo Credit: opportunitygreen

At the Y Combinator seed stage web venture accelerator program, there is a famous graph about the hype cycle of emerging technology that former participants and mentors show new program members to help ground them in the ups and downs of startups. The graph starts from launch, goes up and to the right as big media and the buzz machine takes hold (the peak of inflated expectations), and then crashes into the ground as the startup gets into the messy business of turning an idea into a business. As I hang out at the Third SoCap, I wonder if our field is in the trough of disillusionment.

For the last five years, few things in the social change space have had the buzz and cache as "social entrepreneurship." Part of it is a generational thing: Millennials have seen the failures of the pure-business and the pure-activism mindsets, and are attracted to the blend. But part of it is simply that this is an idea whose time has come. People have been working for decades to prove the basic models that bring financial value and social good together, and those experiments have converged into knowledge and hit a cultural zeitgeist that is simply ready to supercharge them into the mainstream.

And supercharged the field has been. Social entrepreneurship has been exposed. Muhammed Yunus' win of the Nobel Peace Prize for his work building the microfinance field; Kiva's bringing online opportunities to get involved in the social entrepreneurship field to people's living rooms; the list goes on. The point is that there have been incredible expectations -- perhaps a peak of inflated expectations, to use the hype cycle terminology.

Yet in the two years since the financial world collapsed, and the prognosticators claimed that now was the time for social entrepreneurship and social business, the reality is that the field hasn't gone mainstream. Most investors still do not think primarily in terms of social and economic value. Most entrepreneurs continue to create businesses outside this space. Even the high expectation of the Obama Administrations' much-vaunted embrace of social innovation have been somewhat flubbed.

And there has been some disillusionment. I've seen many young entrepreneurs veer away from the field rather than diving deep because of it. The good news is what comes after the trough of disillusionment. It is the "slope of enlightenment," when the new technology begins to have figured out enough about how it intersects with the real world -- outside the hype cycle --  to actually get traction and change things in a meaningful way.

I'm not sure whether we're through the trough of disillusionment or not. This field feels like its starting to get past its own hype, there's more and more doing (although also still a lot of talking) and I think that's positive. Only time will tell where we go next, but if there is something of a diminished hype, I think it's a positive and necessary step toward a field fully unleashed.

While I try to look at everything I cover on this blog from many angles, when it comes to coverage of the Unreasonable Institute, I am completely biased. I think that they are filling a vital education gap (and hopefully, increasingly, a funding gap) in our sector with panache and joie de vivre and if you're an early-stage social entrepreneur who wants a significant competitive advantage and amazingly supportive community, you'd be nuts not to apply.

For those who haven't read about the Unreasonable Institute, the program was founded in 2009 and held its first summer incubator in 2010. The program is an 8-week live-in program in Boulder, Colorado. During that time, entrepreneurs live together and learn from one another, and are treated to daily sessions with mentors who are experts in topics ranging from branding to business development and beyond.

In addition to that support, they have the opportunity to come away from the summer with a meaningful dose of new funding. The Unreasonable Institute hosts one of First Light Venture's Village Capital programs, which means that the entrepreneurs actually make the decisions about funding, as well. Last year, funding went to mobile money gateway Kopo Kopo, direct trade coffee company Liga Masiva, and ethical toilet paper company Who Gives A Crap?

Something I think will be different than last year will be an emphasis on curricular trajectory. The program is anchored by the relationships between the Unreasonable entrepreneurs and mentors, but last year, there wasn't a clear, linear path through the content that the mentors we're providing. This coming year, the program will be divided into 5 weeks for business development and 3 weeks on execution and outreach.

The application process -- which has just opened --  involves a first round written application, a second round of interviews, and most interestingly, a third round fundraising battle royale. The program costs $10,000, but entrepreneurs aren't allowed to pay. They have to fundraise it all online in a test of entrepreneurial mettle.

I can't say enough good things about the program and the people behind it. Stop reading now and go apply.

And if you still need convincing, watch the first of ten episodes of Unreasonable TV from the 2010 institute.

Unreasonable TV: Episode 1 - Unreasonable Beginnings from Unreasonable Institute on Vimeo.

Photo credit: Daniel Epstein