Business by numbers: Entrepreneurship

Late Tuesday afternoon, while I was strolling through Ottawa International Airport on my way back from a conference, a magazine title jumped out at me from one of the airport newsagents. It was called Inc.

If I were asked to describe it, I’d say it was a bit like “Wired for entrepreneurs”. If you’re into business, startups, entrepreneurship (and, yes, social entrepreneurship) I’d say it’s a must-read. You can check out Inc.’s website here.

One of the many gems in the current March edition is this infographic, which I thought was well worth sharing.

Click here for a larger version, and while you’re at it go on over to the Inc. website and subscribe. I will be.

The Rolling Stones School of Management Innovation

What do the Rolling Stones and FrontlineSMS have in common? Not much, you might think. Well, they’re not users, they’re a little better-off than us and they’re considerably more famous. But there is something a little more subtle we share with them – management innovation.

In his autobiography – “Life” – published last year, Keith Richards describes the evolution of The Rolling Stones‘ management. Three quite distinct individuals played key roles in getting the band to where they are today. From an article last November in The Week magazine:

“First up was Andrew Loog Oldham – described as an oddity of the London music scene – who successfully branded The Stones as the “dirty, snarling and mean” antidote to the then clean-cut Beatles. Then came Allen Klein, a lawyer expert in negotiating with record companies. Finally, there was Prince Rupert Lowenstein, a private banker with no roots in the music industry, who professionalised the outfit – establishing separate companies to handle publishing, merchandising and touring – which made The Stones one of the richest bands in history”

The evolution and management of FrontlineSMS can also be broken down into three phases:

  • Technology innovation
  • Organisational innovation
  • Business model innovation

As The Stones example demonstrates, each phase requires a very different skill set, and it would take an extraordinary individual to be able to manage and deliver successfully on each. While I may have been the right person – in the right place at the right time at the very least – to successfully deliver on Phase One, that doesn’t mean I’m the right person for Phase Two, or Three. A large part of building a successful organisation is assembling a talented, diverse team with complementary skill sets. Identifying gaps and being honest about our own strengths and weaknesses is a large part of the process.

The social entrepreneurship sector, however, remains largely laser-focused on the innovator, the person behind Phase One. Recognising that organisations develop in phases, and have different needs at each, there needs to be a slight shift in how we view – and support – entrepreneurs and the vehicles or organisations they help create.

With this in mind, there might well be a few things the social entrepreneurship sector could learn from The Rolling Stones.

Why I’m not a social entrepreneur

A few years ago, back during my university days, I was asked to write an essay on ‘sustainable development‘ and what the term actually meant. The general consensus seemed to be that it meant very little, not because the rationale behind the term wasn’t a compelling one, but because it was being so widely misused that it had become pretty-much meaningless.

I feel the same might be happening today with the term ‘social entrepreneur‘. So many people claim to be one, and so many universities are ‘teaching’ people how to become one, the term is becoming blurred, almost fashion-statement-like.

For a start, I don’t think anyone can just become a social entrepreneur by simply going through a process. Sure, people can learn the mechanics of social entrepreneurship – business models, sustainability, global (and local) social issues, fundraising and so on – but that’s it. You have to earn the title, not learn it. Having an honours degree in social entrepreneurship – or whatever it might be – doesn’t automatically make you one.

Personally I have never considered myself a social entrepreneur, even though my poster at Stanford says that I am. To make things worse, I’m not much of a ‘title’ person, either. I don’t find it helpful putting people into neat little boxes, but that seems to be how things work these days. If other people want to put me into the ‘social entrepreneur’ box then they’re free to do so, but I won’t be doing it myself.

There are many reasons why I don’t think I belong there – too many to list in a blog entry without it becoming long and tedious. But perhaps the main one is this: I don’t believe that I, Ken Banks, am an agent for social change. I am comfortable taking a support role, helping empower other people to become agents of social change.

And if that means I’m not a social entrepreneur then I, for one, have no problem with that.

VC? Not for me…

Today on the Reuters Digital Vision Program we had the opportunity to mock pitch to three Venture Capitalist (VC) firms from Silicon Valley. As my fellow Fellows honed their pitches and made final tweaks to their presentations, I was ‘absent with leave’. It’s not that I’m not grateful for the opportunity, it’s just that I don’t have a business model for what I do. I barely make enough money for myself, let alone give someone else a good return on theirs (or any return, come to that).

Instead, I’m in search of the pure social investor.

Who would this be? What would they ‘look’ like? Well, by definition, a pure social investor would see the value of and realise that a solid sustainable business model, with a monetary return, is an unfair ask. They would instead want a strong social return based on a continuing service to non-profits and disenfranchised individuals and communities – grassroots organisations that need FrontlineSMS, or some crucial technical input into their project, or students and researchers wanting to understand the impact of technology in developing countries. is all about bringing down barriers. Asking for money for many of these services would simply put up another.

There are many grand schemes out there, people trying to develop multi-million dollar solutions to hundred-thousand dollar problems. Subsidised or not, many seek a financial return for their investors. Schmoozing with politicians and large multinational donor organisations takes time – some projects take years to come to fruition, let alone begin to deliver, and then large percentages of the grants get siphoned off to cover a multitude of overheads. So, while people are busy working on their “big picture”, kiwanja will happily keep working on the smaller one, chipping away at the problems, and provide tools, inspiration and support for dedicated organisations and individuals out in the ‘real’ world. It’s not that this helps me sleep better at night. Quite simply, it’s where I see the greatest need.

And the greatest impact.