The Importance of Patience in the Social Economy

I’ve been hearing the word patience used often, especially in the context of the social economy. "Patient capital" is the term used for money invested in social efforts, where people allow for longer terms of repayment; "patient investors" are (you guessed it) those who invest in social ventures. All this talk made me examine my own relationship to patience, both in my personal and professional life.

As an American I have an aversion to being patient. Western cultures equate patience with stagnation, the enemy of growth. Let’s face it, patience is boring and unexciting. It reminds me of waiting in line at the DMV, the epitome of hell on earth.

The common perception remains that businesses demonstrate success by constantly growing, each quarter. This leaves little room for patience as stockholders and investors demand larger profits, which feeds the culture of more.

The social economy also grows impatient waiting to prove its legitimacy and demonstrate successes to skeptical capitalists and pessimistic altruists. However, in this newly formed sector, there lies opportunity to do things differently, out of necessity and intention. Social entrepreneurs don’t have the luxury of massive returns and creating new Mark Zuckerbergs. Instead, they must accept a new definition of success and enjoy the often hidden aspects that patience brings to the table.  

I am also battling with having patience in my personal life. I’m impatient for finding love, getting my dream job, finding the best Brooklyn apartment, solving life’s toughest questions. Unfortunately, my impatience causes me to focus on tangible outcomes of success, which in turn blind me from enjoying the unfolding journey. I forget to be grateful for what I have, and am instead focused on what I am lacking. In making this observation, I realized that this lesson also makes sense in the context of businesses, a value that we can need to bring to the social economy.

As we enter into this new era of cross-sector collaboration, it seems the perfect moment to do things differently and learn from the lessons of the past. We have all seen first hand the Wall Street greed and environmental devastation of wanting more than our share, and impatiently demanding it now.

If this sector is in fact going to “succeed” by adding both social and financial value to the world, it must bring something entirely new to the table, infusing values that we lost along the way. I’ve heard it called bringing soul back to business. If we continue to be impatient, and push the need for results and outcomes, rather than focusing on making the journey more valuable, we will be no different than any other sector, and this will be the biggest failure of all.

Same Same, but Different (Debunking the Mysteriousness of Malaysia)

Often when I tell people I’m traveling to Kuala Lumpur (or KL), the capital of Malaysia, they tell me “how brave” I am to be traveling to such an exotic and far away place, especially alone as a woman. Surprisingly, I felt safer walking around parts of “KL” at alone at night than I have felt walking around in my old neighborhood in Brooklyn.

Petronas Towers

Women-only cars

When I first bought my plane tickets I had never even HEARD of Kuala Lumpur, and I wanted to go there because it did feel so far away and “mysterious.” But the most unexpected thing about KL was that, at times, it felt so familiar.

Kuala Lumpur is a bustling cosmopolitan city with excellent public transportation. New York’s subway system pales in comparison to the clean, air-conditioned, easy-to-navigate Malaysian stations. Needless to say, I do not miss waiting for the G train in the heat of summer. To cut down on sexual harassment, the trains even offered women-only cars, a welcome oasis away from grabby hands. NYC, take note.

Most of my interviews and meetings took place in coffee shops, like Starbucks, Coffee Bean, or boutique artsy ones, all located in large malls. Malaysians spend a significant amount of time in huge western-style malls, fully equipped with H&M, Apple Stores, and yes, even Johnny Rockets. City residents make an exodus out of the central part of KL to airconditioned havens to escape the oppressive heat and overcrowded streets. The food court is basically my idea of heaven, imagine curry, hot pots, and delicious rice dishes for under $3.

Interestingly enough, it was not just the infrastructure of KL that reminded me of the western world. In my short time connecting with social entrepreneurs and intermediaries there, I discovered that their community faces many of the same barriers and fears that are felt in the global social economy.

The two issues that arose time and again were:

1.    Access to talent – Nonprofits and social enterprises find it difficult to recruit the best talent. They cannot offer competitive salaries or perks. (Have yet to find a charity that provides yoga classes or sushi much like a certain company that rhymes with Foogle).

2.    Changing public perception to highlight the need for social enterprises. People around the globe understand charity, and they get what a for profit business does. It’s quite difficult to explain the need to change these fundamental structures, to explain that our current system (in most countries) is not working.

There is something seriously comforting that social economies across the globe face similar barriers. It builds community and increases the chances for collaboration. It makes me feel that we are all in this together, all of us unsure of how to ensure the ideas of a social enterprise do not become a passing fad. After meeting the incredible folks in this space in Malaysia and Singapore, I have faith that this movement will be the thing we need to put soul and humanity back into the business world, and maybe, just maybe, make the world suck a little less.

Edited by the extraordinarily talented and hilarious Cat Crow

Getting Paid a Living Wage (Aka, Why I should live in Sydney)

I’m not sure what first sold me on Sydney, the gorgeous beaches, universal healthcare, heaps of hip coffee shops, or the perfect weather.

I thought it couldn’t get any better until I discovered that the minimum wage is $17/hour, compared to New York City’s $8/hour. In Australia, waiters, bartenders, day laborers, and yes, even nonprofit/social enterprise employees get paid competitive salaries.

                         Photo credit: @MichaelMcdonough

To be fair, it’s quite necessary to earn high salaries considering the insane prices of food and housing. Mind you, I spent the last year living in Brooklyn, so I really understand the clinically insane life decision of spending your paycheck on your small cramped apartment, and squandering the remainder of your life savings on awesomely delicious restaurants.

Amazingly, Sydney seems even more expensive than New York City. Without exaggeration I spent $16 USD dollars on oatmeal, and felt like I got a fairly good deal. It did came with local honey, delicious passion fruit compote, and a hunky waiter with a great accent. My mouth dropped when I got the bill, and I immediately questioned how ANYONE affords to live here.

Photo credit: @Mathfinancial

I quickly learned the answer is quite a simple. People get paid a living wage. For an American, this concept is foreign. My friends and former colleagues working in the nonprofit sector barely scrape by on their meager salaries and we often laugh at our paychecks post deductions. I assure you, we only laugh because otherwise we might cry.

This leads me to by far my largest frustration with the nonprofit world, the inadequate pay. I believe this quality prevents the entire sector from thriving for two major reasons:.

1.Talent is drawn away from the nonprofit sector because of low wages. Smart innovative folks opt for a better salary in other sectors.

Say you’re a young recent graduate from a top school with over $150,000 of debt. Would you choose to move to the New York City and accept the entry-level nonprofit job offering $35,000 pre-tax or opt for the $85,000 corporate job? This question plagues many inquiring young minds who want to make an impact, but simply cannot make the irrational decision to chose a nonprofit job.

Over time, this draws talent away from the sector and many of the brightest minds leave. Fighting the world’s toughest challenges requires all of the genius in the world. The sector needs to position itself to be competitive, not a place best suited for people with rich parents or rich spouses.

2. Low-wages maintain the idea that nonprofit work has less value than other types of work

People making the largest amounts of money are seen as more prestigious, more successful, and more valuable. Nonprofit’s small budgets and measly salaries give off the impression that these organizations create less value and are in turn, less important. If nonprofits want to be taken more seriously, and be seen as a force to be reckoned with, we need to start paying people competitive wages.

Imagine a world where organizations and companies addressing social and environmental ills are seen as equally valuable to Fortune 500 companies.Think of a reality where the most competent and highly skilled individuals happily leave their corporate jobs to fight poverty, and do so without a significant pay cut.

Now stop We should stop dreaming of that world and go out and fight for it.

Philanthropy Must Change

In my brief 25 year stint on this earth I have learned a few things from my years of working in nonprofits around the US and abroad. And I have continually found these following things to be true.

1) There is a TON of money in philanthropy. In fact, an estimated $316.23 Billion dollars were given in 2012 by American donors. (http://www.philanthropy.iupui.edu/news/article/giving-usa-20130)

2) There is an increasing number of intelligent social innovators and skilled nonprofit employees. Nonprofits employ a multitude of  educated workers and the number of social entrepreneurs is on the rise.  Just talk to the thousands of social entrepreneurs who did not receive Echoing Green or The Unreasonable Institute funding tosee how many driven social innovators there are.

3)The overall culture of philanthropy is changing, and more people than ever before want fulfillment in their lives and are looking to “give back”.

These three pieces of information have continually lead me to the same question...

If we have enough money, loads of smart people, and the will to change the world- why are we facing increasing economic and social disparity among people?

My answer is that we are looking in all the wrong places and asking the wrong questions. We have to change the conversation and radically alter the institutional structures that are hindering large scale change. I’m not arguing for an overthrow of the government or an overhaul of capitalism. In fact I believe quite the opposite is helpful. I think we can gain great insights and improved outcomes from cross-sector partnerships.

I certainly don’t claim to know the answers to many of the field’s toughest questions. Just like many of you, I am floundering in this world trying to make sense of my circumstances and define my own version of happiness and success. All I know is that I am truly inspired by the many social innovators around the world, and I believe in our determination tomake this world a more humane place. I know the many blessings and opportunities I received in my life should not be a rarity. My goal is to write about the sector, and draw from the multitude of wisdom in the field.

And as one very wise man once said to me,

“It probably won’t happen unless we make it so.”

So, we better get moving.

Arguing (some) Nonprofits Need to Shutdown

@dgoomany

I often find myself in heated debates with my closest friends when I say that many nonprofits need to shut down.

Not ALL nonprofits, rather the ones that are not succeeding in their goals. This opinion isn't a formula for making friends. I am often faced with an icy stare and questions such as, “Can you really propose that people should be cut-off from life-sustaining services because you think the nonprofit is doing a bad job? Isn’t it better than the alternative?”

My friends may think I'm an ice queen but their heartfelt arguments dont change my mind. Nonprofits must demonstrate their programs are working in an effective and sustainable manner. If not, they have failed, and need to close their doors, or radically alter their business model. Just OK isn’t good enough-- for the organization, for the clients, donors, and the sector at large.

I understand this idea appears critical of nonprofits providing vital services, but this argument highlights how often a worthy cause distracts us from questioning an organization’s overall value. Meaning, even if a nonprofit is delivering a necessary service, this is not reason enough for them to be in operation. They must prove they are succeeding in their goals and creating an effective service model.

This discussion occurs far less often in the for-profit world, where the cycle of businesses closing and opening is dependent on the bottom line. In the nonprofit world, we have yet to define a standard metric system that holds nonprofits accountable to the same goal (in fact, each nonprofit defines their own.) Thus, we have no method of understanding when a nonprofit fails or succeeds.This system, or lack thereof, is not doing anyone any good, especially the populations these organizations serve.

We are in the next era of philanthropy, where creating organizations with laudable missions are no longer cause for celebration. We need to refocus our energies towards figuring out what works and what factually does not. After all, shouldn’t we be MORE concerned with organizations interacting with vulnerable populations? Shouldn't we be bending over backward to figure out which programs are in fact the best at helping these populations and then, and only then, support them to scale? How can we be happy with services that are just good enough?

"We are in the next era of philanthropy, where creating organizations with laudable missions are no longer cause for celebration... The bar needs to be set higher."

Of course in this post, I'm oversimplifying the many obstacles faced in the process of creating a nonprofit metric system. Also, don't misunderstand that I'm in any way blaming nonprofits.  I don't think the burden should fall entirely on already thinly stretched nonprofit budgets.

In a way, we all have a part to play. It is up to the donor to give smarter, the foundation to incentive (and support) evaluation, for other sectors to collaborate and innovate, and for the general populace to value fixing social problems, rather than accepting band-aids.

When failing nonprofits close, other organizations take their place, and a more effective few will succeed. Social innovators, and entrepreneurs will continue to fight and collaborate in order to seek solutions that are better than their predecessors. They demand that the BEST and most effective services are provided to those most in need, and settle for nothing less. In this mindset, we can make a real difference, the nonprofit sector can thrive, and I’ll get to stop arguing with my friends.