The Connection Magazine AIM MUTUAL Spring 2020 | Page 11

So, Why Wouldn’t Someone Just Start A Non-Profit Or
Charity? What’s The Difference?
With non-profits, there’s a finite amount of resources. Think
of a bucket that has a certain amount of money inside. Once
you use that money, you’re done. You have to go out and ask for
more. Fundraise. Sometimes this means filling out 14-page grant
applications for a $5k grant that take a year to process. Slow
moving. There are so many non-profits that are fighting for this
money but it’s incredibly limited.
With a for profit + for purpose company, you’re growing your
bucket of money and self-sustaining. You have the potential to
grow and scale your business with infinite potential resources
because you’re generating revenue while also giving back
and making a social impact. With ArtLifting, the homeless
artist receives 55 percent of the profit, 44 percent goes to the
company and one percent goes to shelters they work with. They
license the art, print the art on tangible items and sell the original
art as well as prints. ArtLifting is what’s called a b-corp, a Benefit
Corporation.
What’s A B-Corp? Just Like An S-Corp, It’s A Legal Business
Structure That Allows The Government To Classify Your
Business Type. The Main Difference Is That With A B-Corp, You
Have A Legally-Binding Social Mission So The Company Can
Protect Both Bottom Lines – Financial And Social.
Meaning, if you’re filing as a b-corp and you have investors, they
can’t push the company away from the social mission in order to
maximize profit. The company can protect its social bottom line
so it’s not compromised for financial success. If investors want to
shift direction or strategy in order to make more money but that
will jeopardize the company’s social impact, the company can
legally push back and lean on the b-corp status. There are many
companies out there that have a give-back component, but they
don’t file as a b-corp. You don’t have to be a b-corp. As of now,
there are no tax benefits to b-corps. (Not yet at least!)
Pros To For Profit + For Purpose Business Model:
• Your product and message IS your marketing. By simply
existing, your customers are your sales people. It can
become a movement. (TOMS shoes, example). Example:
ArtLifting didn’t spend a penny on marketing to get
started.
• You know those millennials that everyone has an opinion
about? They are conscious consumers – meaning they
care where they spend their dollars, even if it means
paying more, and this trend is transcending the millennial
generation.
• Legal protection (b-corps explained above)
• You can make MORE impact as a for-profit company.
• This allows people to start for-profit companies that
serve as wage-earning, full-time jobs vs. starting a charity
that’s a side hobby. Because this economic model is
generating revenue, it can be a “day job” where you focus
all of your time and energy.
• You’re doing good and doing well. (Aka – have cake and eat
it too. Yummy.)
Cons:
• Skepticism – Anytime there’s something new, people will
develop innovation allergies. Some people have concerns
about exploitation and companies using a social mission
in order to get more profit. (When actually the impact has
more potential as a for-profit entity.)
• Lack of education – The business model simply isn’t well
known yet. This fuels skepticism and many people are not
aware they have this option when starting a company or
business.
To learn all there is to know about this business model, listen
to Liz Powers amyjomartin.com/whynotnowlizpowers/), cofounder
of ArtLifting, explain her journey and the details of
getting started. She bootstrapped her company starting with
$4k and personally living very lean in her 20’s. She quickly grew
the business to six figures in revenue before receiving funding
from investors like Blake Mycoski from TOMS shoes.
Do good, do well. Do double bottom line. For profit + for
purpose. For sure.
Amy Jo Martin
Amy Jo is the author of New York Times best-seller Renegades Write the Rules, and host of theWhy Not Now? podcast. She founded Digital Royalty
in 2009 to help corporations, celebrities and sports entities humanize their brands online through social communication channels. Tony Hsieh, CEO of
Zappos.com, and Baron Davis, NBA player, invested in Amy Jo and her company. After a successful seven-year run as the Founder & CEO of Digital Royalty
and growing the business globally into 10 different countries, Amy Jo recently exited the company. She is currently spending her time researching the
relationship between technology and humanity. She is also investing in other female entrepreneurs so they can reach their full potential. Amy Jo is also a
contributor to news outlets including the Harvard Business Review and Sports Business Journal. She has been featured in top-tier media outlets including
Vanity Fair, TIME, Forbes, The New York Times, Fast Company, ESPN Sports Center, USA Today, MSNBC and Newsweek. Client portfolio includes: Hilton
Worldwide, Shaquille O’Neal, Motorola, FOX Sports, The X-Factor, Chicago White Sox, UFC and Dana White, Dwayne “The Rock” Johnson, Los Angeles
Kings, Jabbawockeeez, Doubletree by Hilton, Tony Hsieh CEO of Zappos.com, Monte Carlo Resort & Casino, KC Royals and Hard Rock Hotel & Casino.
AmyJoMartin.com
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