NEWSSUSTAINABLE & GREEN

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

The financial crisis has not, thus far, cast a clear death blow to Milton Friedman's idea that the only responsibility businesses have to society is to maximize profits. That said, the last couple years have seen a steady mainstreaming of "social entrepreneurship," particularly within vertical industry categories such as Fair Trade. I believe both the verticalization and mainstreaming of the field will continue, creating a higher need than ever before to understand just what the broader designation of "social entrepreneurship" has to offer.

Social entrepreneurship tends to refer to the space in which companies and nonprofits use market and business objectives to achieve social aims. While there is some debate about whether the term refers exclusively to one legal business model over another, the core point for most of the people I tend to agree with is that "social ventures" as opposed to regular for-profit entities have an explicit focus on solving some social or environmental problem and maximizing social or environmental good alongside (or sometimes even at the expense of) pure, short-term profit maximization.

In this way, it is different from corporate social responsibility, which at its best is about giving back, improving employee culture and conditions, and reducing environmental impact. The difference is the fact that social entrepreneurship suggests that there is a core social or environmental value created every day by the products or services at the center of the very business. This does not mean that social ventures are "better" than non-social ventures -- there are lots of great companies that simply happen not to focus on solving social problems and which are still wonderful employees, community members, and philanthropists -- but it does mean they are different.

Social entrepreneurship is, however, a slightly weird field, in the sense that it is not an industry, but a term which applies to a number of (sometimes unrelated) industries, and a similar approach to business that places a social or environmental value at the center of the mission. Most people come into contact with the broader field of social entrepreneurship through one of the industries that it touches.

I think there are a few clear examples of  these "vertical" fields that connect with the larger banner of social entrepreneurship that have gotten increasingly mainstream over the last few years. Cleantech is perhaps the most obvious, becoming one of the most invested in areas of venture capital ($1.9 billion was invested in Cleantech companies in the first quarter of 2010 alone). Microfinance is another clear example. The awarding of the Nobel Peace Prize to Grameen Bank founder Muhammed Yunus and the explosive popularity of Kiva are two of the more important historical moments for the prominence of social entrepreneurship, and the recent IPO of SKS could be another. Fair Trade, Organic and Local Food movements are all racing to the mainstream, as well.

Being based in Silicon Valley, I'm particularly interested in industry verticals that can attract tech talent to start new companies. I think we're going to see big booms in education startups (see: Udemy, Enzi, Grockit, DonorsChoose, Supercool School) and I hope that many will learn to work within instead of solely outside the current education system. Healthcare seems like an obvious area that mixes social good with the potential for immense profit, but there are still too few web tech companies working on the issue, a problem that programs like Hacking 4 Health are trying to redress. And although they are a little bit different in terms of their potential for financial gain, there also seems to be a mini wave of "government 2.0" startups (see: Code for America, CitySourced, Gov2.0 Summit) that are trying to change the way municipal services are deployed and how governments interact with citizens.

It makes sense that social entrepreneurship would mature into verticals like this: startups need accumulated bodies of knowledge and connections to be successful, and ultimately, what works in Fair Trade may not work in Education. At the same time, I think the common element of trying to maximize a social or environmental good takes as much managerial discipline as deploying a successful revenue model, and for that, the broader field of social entrepreneurship has much to offer.

Photo credit: Chuck “Caveman” Coker

Tesla is one of the most visible companies pursuing a future of greener transportation, and one of the few electric car projects to actual try to design vehicles with an aesthetic that conveys power and sleekness. Yesterday the company made it's initial public offering, achieving a market capitalization of more than $2 billion.

Tesla is in the news pretty often. It is led by Elon Musk, one of the co-founders of PayPal whose other company SpaceX just successful put a rocket that will eventually carry people for private space travel into orbit. Recently, the company made news when it signed a big deal with Toyota to help fund the manufacture of it's first general consumer sedan.

I think the company is worth tracking from the social entrepreneurship vantage for a number of reasons. First, it's a major, major for-profit play (they raised $200+ million from their IPO yesterday) to lead the emerging alternative energy car generation. Second, I think in general, Elon Musk-sized ambition is worth keeping track of for young entrepreneurs.

I've written before that I worry that social entrepreneurship has something of an ambition problem. Too many of the young entrepreneurs I see don't feel like the big, game-changing play is something that's possible. I don't think at all that everyone needs to aim for an enterprise that impacts a billion people, but I think that every new entrepreneur has to believe deep in their guts that that is a plausible path should it be right for them and their business.

Tesla is just at the beginning. It has yet to create a mass market auto. It has immense financial and infrastructure hurdles to overcome. But there is something immensely exciting about it. It's the first American auto company to go public since Ford in 1956. If we're optimistic, it could herald the beginning of the new era of more sustainable transport.

Photo credit: jurvetson

At this point, it's hard to deny that "green" is a beast of an industry that has left the social entrepreneurship nest. Bloomberg Businessweek's annual "America's Most Promising Social Entrepreneurs" feature, however, displays the connection between the spaces as prominently as I've seen in major media coverage for some time. This is a trend I think we should encourage.

When I set out to write my "Top Moments of the Decade" in social entrepreneurship post last December, I faced an interesting question. What moment(s) in clean or green technology should I highlight as part of that list? As I started to think about it, I got less and less sure that it fit.

For one, the environmental movement predated at least the consolidated social entrepreneurship movement by years, so it felt a little weird to subsume its banner. Second, the intersection of the environmental movement and big business that has born the cleantech industry over the last decade is operating in such an independent space when it relates to social entrepreneurship that it hardly felt like part of the same thing. Ultimately, I opted to list Al Gore's "An Inconvenient Truth" as an honorable mention, and shared some of these questions I had been having.

I've been thinking about that more and more lately, and wondering not only whether that was the right decision on my part, but moreover whether we as a field need to be even more proactive about linking the movements.

There is a language question that worries me. Right now, a lot of the movement around cleantech is that it's "good business." That's great, in the sense that it's no longer relegated to the margins of economic activity as charity. And it's good because ultimately, we need these technologies now, almost regardless of the motivation.

TechCrunch founder Michael Arrington came out swinging against the growing conversation between Silicon Valley and Washington D.C. this weekend. The thesis of the post "Here's How the Government Can Fix Silicon Valley: Leave it Alone," was that the government is too in-bed with giant corporations and too heavy-handed in its regulations to do anything other than mess up the venture ecosystem. Is he right?

Point: The Government is Destined to Destroy Tech Innovation

1. Heavy-Handed Regulation: I'm not the type of person who thinks that "regulation" is a four-letter word. That said, I don't think that our government is particularly good at recognizing the difference between economic activity in which risk is essential (like venture capital) and economic activity for which too much risk is poison (like currency speculation).

This is a particularly sensitive area for investors and entrepreneurs who have seen the market for IPOs (where a company goes from privately held to publicly traded) decimated by the Sarbannes-Oaxley Act, which created costly hoops that make startups less and less inclined to IPO. The bill was intended to stem corporate fraud and abuse in the wake of the Enron scandal but has had unintended consequences for the venture community that it is still learning to deal with. More recently, the Dodd financial bill has included provisions that could undercut incentives for angel investing.

2. Sleeping with the Un-novators: Another big problem for Arrington is how in bed with the giant telecoms and media companies the government remains. I totally agree with him here. Companies like Comcast and ATT can and do spend an insane amount on lobbying to preserve their control over broadband and telecommunication access. And all too often in our current, money-ruled congressional system, opinions follow dollars. The FCC's slow-walking of Obama's Net Neutrality promises is one of the examples Arrington uses to make his point.

Learning from complex adaptive systems is arguably the hottest area of organizational strategy today.

In a nutshell, a complex system is one in which simple interactions work together to produce a greater whole.  In the natural sciences, complexity is essential for understanding the dynamics of environmental sustainability.  Applying principles derived from complex systems in nature has also become a primary source of inspiration for sustainable social design, from green buildings patterned after termite mounds to ecosystemic models of health care reform.  Complexity science is also emerging as the cutting-edge of social enterpreneurship research--in fact, Routledge's new Journal of Social Entrepreneurship, edited by Skoll professor Alex Nicholls, includes an excellent article presenting a complexity science model of social enterprise.

However, for many people new to the field, the very word complexity--not to mention such concepts as dynamical networks and attractor basins--can make the field seem somewhat daunting.  Fortunately, a new book has appeared to help social entrepreneurs apply the core insights of complexity science without the math and academic jargon.

Adjacent Opportunities: Sparking Emergent Social Action provides a crisp, compelling introduction to what author Ron Schultz aptly describes as the "ordinary magic" of social innovation.  Through a series of engaging anecdotes and fun observations, Schultz explains how social systems work, underscoring in particular the importance of small differences and quiet voices in creating a cultural shift.

As Schultz observes, focusing on rigorous efficiency and system-changing solutions can actually lead us to devalue the small but significant actions from which systemic change will emerge.  Instead, we need to learn how to find opportunities in the unexpected--and to develop the courage, or "Applied Chutzpah," to take "audacious action" without knowing where it will lead.

There's much more I could say about Adjacent Opportunities, from its insights on cultivating a constituency to its fresh perspectives on CSR, microfinance and practical decision-making, but the best way to learn its lessons is to read it yourself.  Just as Schultz celebrates how recognizing our deep interconnectedness within a complex adaptive system is an "exhilarating and joyful" experience, the same is also true of his book.

Photo credit: Anacin Extero

There is something pretty amazing going on in Denver, and it might just change the world. B-cycle, a nonprofit that provides rental bikes around the city, has found a cheap, fun way to make Denver a cleaner city and its inhabitants and visitors healthier.  I spent last weekend playing tourist in Denver and the experience was made so much better, and cleaner, because of the rows of red B-cycle rental bikes around the city. Denver is demonstrating that change really is possible, especially when it's easy and fun.

Denver is the first U.S. city to do what European, Canadian, Chinese and Mexican cities have already done--share bikes. Here's how it works. You buy a short or long-term "membership" via credit card online starting at $5. Then grab one of the 500 bikes waiting for you at the 50 kiosks around the city (found through a pretty cool iPhone app) and ride. When you're done, return it to any of the kiosks, and your card will be charged for the amount of time you rode. The first 30 minutes are free, and it goes up in increments of around $1-2 for each 30 minutes after that.

As tourists, my husband and I found enormous value in B-cycle. Because of the availability of the shared bikes, we decided not to rent a car. By the end of 3 days we had (according to the computers embedded in our bikes) ridden 49 miles, burned 1,944 calories, created a carbon offset of 46 pounds and saved $25.76 in gas money. In addition, we saved about $150 in rental car costs and parking.   Our total bike rental fees was only $26. So we saved about $150 in costs, got some fabulous exercise, did not pollute the city, and actually got a much more intimate view of the city than we would ever have by car. Not bad for a holiday weekend.

But it's not just for tourists, by far. The idea is that Denver residents can climb on a bike "for trips that are too far to walk but too short to drive." With a shared bike you can run an errand, get out for a bit at lunch, travel from the bus stop to your office, and much more.

The politician-turned-venture-capitalist act seems to be increasingly the rage. Joining former Vice President Al Gore and former New York mayor George Pataki in the venture world, former British Prime Minister Tony Blair announced yesterday that he would be joining Khosla Ventures as an advisor on renewable technology.

The former PM was once at the helm of a mid 1990s liberal resurgence that was meant to challenge the sustained voice of the conservative Thatcherites who had controlled the British public debate since the 1980s. Alas, by the time he left office in 2007, Blair's impact and legacy had been mightily blunted by his decision to support George W. Bush's adventure in Iraq.

Since leaving office, Blair has kept himself busy with little tasks like being the Middle East Peace Envoy for the Quartet, as well as the normal post-president/prime minister stuff like advising megacorporations and giving speeches for a fat dime.

But climate change seems to be at the heart of Blair's new focus. Since leaving government, he has been at the helm of the Breaking the Climate Deadlock initiative to try to build consensus among world leaders about how to reverse the tide on the climate. But the investment in Silicon Valley seems to be driven by a sense that the real opportunity for change is going to come not by curbing consumption, but by creating new technologies that are accessible to everyone, including (even especially) increasingly energy hungry developing countries like India and China.