The oft-repeated phrase “pay it forward” has slowly evolved from a karmic expression into a popular entrepreneurial business plan over the years. These days, creating a business that is focused on helping others or supporting worthy causes has become so popular that there’s now a name for it: social entrepreneurship.
One entrepreneur who has built a successful business on helping others is Chase Garbarino, CEO and cofounder of a company called VentureApp. The company’s mission: helping local groups turn their ideas into success. The business connects entrepreneurs with others that can help with everything from legal work to health plans.
“Fortune 500 companies have divisions dedicated to researching suppliers, service providers, price negotiations and determining what services and products are best for the company,” says Garbarino. “Small to medium-sized businesses are cash-strapped and resource-light.” With that in mind, VentureApp has built up a marketplace of vendors that can help smaller businesses with these services.
In the interest of helping local businesses, vendors are charged to showcase their services, but startups don’t pay anything to join. “Not many restauranteurs or tech startups are like, ‘Man, I can’t wait to pick a lawyer,’” says Garbarino laughingly. “It’s not the passion of why [they] started a business.”
Social entrepreneurship can be described as doing business to solve a social problem or create a positive change. Yet it’s important to point out that using profit to fund a social purpose isn’t new. Non-profits have been raising money and partnering with companies for decades to do good.
Enterprises that marry helping others with a business plan can actually boost the bottom line, according to a report by the Royal Bank of Canada. “In certain areas, social businesses leverage their unique characteristics to help improve performance. For example, the opportunity to engage in personally meaningful work can give them an advantage in attracting talent.”
This marriage, says the report, can also help companies attract even better talent. “People want to work for a double bottom line business. They want to have meaning in their work. So, we’ve been able to recruit very talented people who could have gone to lots of different places, but chose to come to us because of our social purpose,” Tom Heintzman, cofounder of energy retailer Bullfrog, was quoted as saying in the study.
Investor Mario Martinez II is a firm believer in helping others. He sees giving back as a valuable tool to help communities and entrepreneurs grow.
“As an entrepreneur myself, I can’t imagine where I would be without the wisdom and encouragement that others have poured into me over the years — both in my early corporate career, and after I started a business,” he says. “It takes a community to help a business grow, and I believe that as we grow and become more successful, giving that back to others as they pave their way becomes rewarding in and of itself.”
When asked about growing the number of businesses dedicated to helping others that have sprung up, he says it’s important in today’s challenging economy. “The lean business model is forcing entrepreneurs into the ‘fail fast’ mentality,” says Martinez, noting that nine out of 10 startups fail.
“By learning from others’ mistakes and getting input early on, entrepreneurs are finding their place in the market more efficiently,” he says. “These types of services can be invaluable to entrepreneurs that need the right connections.”