Get All Access for $5/mo

A Case for Exploring Alternative Capitalism Models While not a love story, capitalism is certainly epic. Here's a look at what other forms have emerged in recent years.

By Martin Zwilling

In my view, entrepreneurship has always been the ultimate embodiment of capitalism, and quite synonymous with free enterprise. Yet I find that more and more young entrepreneurs are uncomfortable with the term "capitalism," somehow thinking that it places money above all else. They are looking for a business model that makes the world a better place for humanity.

One step in that direction is the trend to "conscious capitalism," as exemplified in the recent book by Whole Foods co-founder John Mackey and professor Raj Sisodia, Conscious Capitalism: Liberating the Heroic Spirit of Business (Harvard Business Review Press). These authors argue that capitalism is simply misunderstood, and businesses run by ethical people create value and prosperity based on voluntary exchange, while reducing poverty.

#insert RSS here#

In a recent blog, "Capitalism: Alternative Realities?" Scott McIntosh, an avid angel investor friend and champion of conscious capitalism, makes the case that true capitalism is powered by entrepreneurs who are driven, only in part, by profits. They're also motivated by the simple desire to make a difference in the world.

Related: Conscious Capitalism: The End of Business as Usual?

We shouldn't let greedy or misguided people derail this. Here are two increasingly used options for doing good by way of running a business:

Promote "Conscious Capitalism" as capitalism re-branded. Socially conscious capitalism, per Mackey's book referenced above, adds four requirements to every business enterprise – focus on a higher purpose, stakeholder orientation, conscious leadership, and a conscious culture and management.Model business examples today include Whole Foods, Southwest Airlines, Costco, Google, Patagonia, The Container Store, UPS, and dozens of others. These set the model for aspiring entrepreneurs to achieve their dream of a good business that is also good for society as a whole.

Related: 4 Ways to Dip a Toe into Social Entrepreneurship

Adopt the B-Corp as a new conscious business model. To more strongly support startups who want to give top priority to socially conscious solutions, eleven states, including New York and California, have passed legislation allowing incorporation as a Benefit Corporation (B-Corp). Other states are close behind in this effort.A benefit corporation is a new corporate form designed for for-profit entities that want to consider society and the environment in addition to profit in their decision making process. The B-Corp status is meant to reduce investor suits, and gives consumers an easy way to spot genuine social commitment, without assuming it is a non-profit.

Some say capitalism would burnish its reputation if the government stepped in with more regulations. Others, including McIntosh in his article referenced above, argue that a way to improve capitalism is to reduce regulation and limit the power of government -- letting market forces work their proven magic of the past 200 years in free economies around the world.

But what about the truly greedy business folks? We need to let market forces work and force them out of business. Those who truly abuse the system need to be held accountable rather than allowing a system of cronyism to provide undue protections.

Personally, I'm not a believer that any government can regulate morality, respect for the environment or concern for the common good. These have to come from the heart, and I'm happy to report that the entrepreneurs I meet are leading the charge. If making money is your primary motivation for starting a business, be prepared for a long and lonely road. Following your passion to change the world is a lot more fun.

What's your take on capitalism? Think it's all bad or just misunderstood? Let us know with a comment below.

Martin Zwilling

Veteran startup mentor, executive, blogger, author, tech professional, and Angel investor.

Martin Zwilling is the founder and CEO of Startup Professionals, a company that provides products and services to startup founders and small business owners. The author of Do You Have What It Takes to Be an Entrepreneur? and Attracting an Angel, he writes a daily blog for entrepreneurs and dispenses advice on the subject of startups.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

The Side Hustle He Started in His College Apartment Turned Into a $70,000-a-Month Income Stream — Then Earned Nearly $2 Million Last Year

Kyle Morrand and his college roommates loved playing retro video games — and the pastime would help launch his career.

Business News

A Former Corporate Lawyer Now Makes Six Figures on YouTube — Here's How She Does It

Here are the secrets to starting and growing a successful YouTube channel, according to a YouTuber with millions of subscribers.

Growing a Business

How to Determine The Ideal Length of Your Marketing Emails Your Customers Will Actually Read

Wondering how long your marketing emails should be? Here's what consumers say — so you can send them exactly what they like.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

Y Combinator Helped Launch Reddit, Airbnb and Dropbox. Here's What I Learned From Its Free Startup School.

The famed startup accelerator offers a free course on building a business — and answers five pressing questions for founders.