Profit Or Purpose: Finding The Balance for Your Startup
Successful modern businesses set out to make a difference, as well as a dollar.
You're reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.
Without making a profit, investing in social enterprises and purposeful ventures simply isn't possible for businesses. Businesses can enrich and change lives for the better on the back of that profit, therefore giving them a purpose beyond cash creation. Society is fast redefining how it views business and what it can do to make the world a better place, solving pressing problems while also making money. A balance between profit and purpose isn't impossible. In fact, it's essential.
A somewhat surprising example of profit and purpose finding a balance can be seen in the pharmaceutical industry. Companies which for years have been the subject of ethical scrutiny, with academics asking whether they existed to use their expertise to cure and prevent disease or simply to make profit for shareholders, have hit the headlines for all the right reasons over the past year.
Major names such as Beyer, Teva and Novartis were at the forefront of providing essential medicines to West African states affected by Ebola. GlaxoSmithKline and Johnson and Johnson have been at the heart of a new vaccine which is currently in testing and has proved hugely successful in the fight against the disease.
While pharmaceutical firms look to solve the world's health concerns by using both their profit and expertise, other industries are turning to certification to improve their standing among consumers when it comes to the environment and social good.
Related: Startup Taka Solutions Wants To Spread Responsible Consumption Using Green Tech
B–Labs, a non–profit organisation, rates firms on its annual Best for the World list, with everything from Afghan telecom companies to Latin American cosmetic firms making the grade. These businesses are ranked highly for their treatment of workers, the environment and community.
This shouldn't be seen as box ticking either. Research by Chivas Regal and the Skoll Centre, at Oxford's Saïd Business, shows that the best talent among Generation Y wants to work for these businesses; ones that affect positive social change. This is backed up by Deloitte research showing that those born after 1982 wanted businesses that focused less on short term goals, while spending more time building their social contributions. These young peoples' opinions matter. Without these millennials, the future of business is bleak.
These young people will doubtless find roles as social intrapreneurs, bringing to bear entrepreneurial and disruptive skills within a wider company environment. Seeing beyond the simplicity of profit for profit's sake, they will create businesses within businesses that change lives. In fact, they already are. Vodafone's Nick Hughes helped build Kenya's largest SMS payment network. It has changed enterprise in the country forever. Microsoft's Sidharth Sehgal's use of the company's Kinect motion sensor gaming tool to help speech impaired people is another excellent example.
Making money is at the core of every business. Without it, it cannot function. But using it to enrich lives and do social good, as well as keeping a healthy balance sheet, can clearly help solve some of the planet's biggest issues, utilising the best talent in order to do so.
First published by Chivas The Venture on http://www.chivas.com/en-gb/the-venture.
The Venture is a global social enterprise initiative searching for extraordinary startups and new ideas that use business to create positive change. If you have a GCC-based social enterprise or an idea for a social enterprise, enter The Venture #WinTheRightWay to potentially win your share of US$1 million. Entries close on 30th November.
