We ran across an interesting article today about social missions becoming a more and more common business impetus for technology based firms. Something between a traditional for-profit and non-profit business…a business run for the social good, without the red tape for the most part. We found it very interesting in regards to ReEnabled.org because it echoes what we hope to turn ReEnabled.org into in the future. We’ve a great desire to solicit discount goods and services for registered users of this site, perhaps even donations and gratis assistance for those things that just make life easier — even if insurance won’t cover it. At any rate, here’s the link to the article in the New York Times (registration required).
Now a new style of “hybrid” technology organization is emerging that is trying to define a path between the nonprofit world and traditional for-profit ventures.
They’re often referred to as “social enterprises” because they pursue social missions instead of profits. But unlike most nonprofit groups, these organizations generate a sustainable source of revenue and do not rely on philanthropy. Earnings are retained and reinvested rather than being distributed to shareholders.
The new companies, like thousands of Silicon Valley start-ups before them, typically begin as small groups of intensely motivated people dedicated to the goal of building a product or service.
The best-known examples are efforts like the Mozilla Corporation, which maintains and develops the Firefox Web browser, and TechSoup, an organization that was started two decades ago to connect technology experts with nonprofit groups. It now distributes commercial software to nonprofit groups in 14 countries. (Mozilla’s mission is to preserve choice and innovation on the Internet, which it considers a social good.)
By most measures both companies, with hundreds of employees, qualify as vibrant businesses. Each has revenue in excess of $50 million annually.
Moreover, there is also a range of smaller organizations, like the Internet Archive in San Francisco, with smaller but sustainable revenue streams. Significantly, an ecosystem is emerging that involves support groups like the Electronic Frontier Foundation, which provides legal services, and the Internet Systems Consortium, which plays the role of an independent Internet service provider for the community.
“There is a lot of discussion taking place right now about a whole new organization form around social enterprise,” said James Fruchterman, president of Benetech, a social enterprise incubator based in Palo Alto. “Many of these efforts can make money; they will just never make enough to provide venture capital rates of return.”
