Quiz: What do you call an entity that generates earned income (like a for-profit) but gives top priority to an explicit social or environmental mission (like a non-profit)?
“A fourth sector of the economy is emerging, with the power to transform the course of capitalism.” – Heerad Sabeti
As we move into a new paradigm, new definitions must be created. The November 2011 issue of the Harvard Business Review puts forth the new term “for-benefit entity”. To the Adbongo team, this term and its description feels like home.
For the past five years, we have struggled to describe our business model. We’ve used the term “hybrid” to describe the idea that we are a for-profit with a non-profit’s priorities. After reading this Harvard Business Review article, we are coming out. We are here, we are queer (as in strange), get used to it. We are not for-profit. We are not non-profit. We are for-benefit.
What exactly do for-benefits do? Some work towards eliminating homelessness, some fight discrimination or malaria, and some- like Adbongo- work for environmental and social progress, all while being forced into the old paradigm’s for-profit or non-profit categories.
The article predicts, however, that the emerging “for-benefit” category will soon become a legally recognized category in many countries. When for-benefits become recognized as a fourth category beyond governments, for-profits and non-profits, the future of capitalism will be re-shaped, the author states.
Really, though, what’s the difference?
The fundamental value-proposition for a for-benefit requires that the organization be able to account for its total impact and performance-financial, social and environmental. The second characteristic of this model is an ecosystemof support.We at Adbongo are excited to participate in the evolution and emergence of the new for-benefit sector of the economy. Our organic business development process teaches other entities how to do the same. Currently we are designing a business zero waste ecosystem that will turn trash into economics. See: EDEN.
If you are an entrepreneur who is already on the for-benefit path or if you are interested in metamorphosis, our team would be happy to collaborate with you. register for zero waste bootcamp, which starts January 6, to get on track for the new, clean economy. Contact John Bush at 972-762-3788 to learn more about how the for-benefit model may benefit your entity.
Source: Sabeti, Heerad. “The For-Benefit Enterprise.” Harvard Business Review Nov 2011: 99-102, Print.