The StartupNation Blog Trends, tips and real-life anecdotes from industry experts

Creative Capitalism: one for one, from day one

Recently, I was contacted by a PR firm (Attention) and asked if I would profile Blake Mycoskie on my blog(s). I’m ashamed to say how long it’s taken me to turn this piece around, however seeing the latest ATT commercial featuring Blake after a long day of meetings (at my day job) shamed me into finishing. My interest in this company stems from the growing trend of businesses that are modeling a new way of making money: Creative Capitalism.

Traditionally, companies that “do good” are generally non profits, and when people find out that a traditional small business is also “doing good” they feel like somehow the company must be taking advantage of the community it is serving if it is also turning a profit. I do not believe this to be the case and formed my consulting company based on the premise that small businesses would contribute to a triple bottom line if they knew where to find it.

Creative Capitalism has been around for a while. Formerly known as social entrepreneurism, it is a concept newly labeled by Bill Gates, Warren Buffet and other market leaders and the premise is that “we should attempt to stretch the reach of market forces so that more companies can benefit from doing work that makes more people better off.” The book is available on Amazon (unsure of where the profits go). So far, it’s a pretty foreign concept to most bottom-line discussions. Having spent time reviewing the giving trends of big tycoons in the past (land trusts, libraries, parks), there is something different about the timing of this idea: the generation that is receiving it.  

Article is continued below

The 30 and 20-somethings have grown disillusioned with where the 1980s consumption and 1990s holding on behavior have gotten us. Those that have the means to get out and travel, see the disparity in the world, come back and want to do something about it. With technology to reflect back their experiences they are twittering, facebooking, myspacing and texting what they are seeing to one another – and a small group are doing something about it.

Why profile TOMS?

Two reasons: 1) Anyone who has seen true the true spirit of leadership in play knows it is the eagerness to lose oneself in the group for the good of the group. This quality is best exemplified in Blake Mycoskie for the simple reason: that is where the heart of his business began. One for One, from day One. 2) Any size business should learn that a social model (something that takes into account the community in which it survives) thrives 10-fold compared to businesses that have tunnel-vision on bottom line sales. There is something to be said for karma.

2007-sept-peopleAbout the Company

TOMS Shoes promises to give to children in need a pair of shoes for each pair it sells. The company  has given over 140,000 pairs of shoes and expects to give more than 300,000 pairs this year.

TOMS Shoes launched in Venice, California and sold 10,000 pairs during the first year in business. As a result, Blake returned to Argentina in October of 2006 with family and friends and unveiled the second phase of his business plan: the Shoe Drop Tour. To meet demand, TOMS now offers Shoe Drop Tours throughout diverse regions of Argentina. These are volunteer opportunities where TOMS Shoes supporters hand-deliver shoes to children. Since its beginning, TOMS has given over 140,000 shoes to children in need around the world. 

Here is a bit of my discussion with Blake:

 

Why shoes?
BLAKE: Walking is the primary mode of transportation in developing countries. Children walk miles just to get food and water, to make their way to school, or to reach medical help. In some communities, children can’t even attend school unless they have proper footwear. And the leading plague in these countries is soil-transmitted parasites. Shoes are such a simple answer to these problems children face every day.

See TOMS educational videos: One Day Without Shoes and Why Ethiopia (warning on the second video for graphic images)

Technology is required in today’s job market. Is TOMS Shoes looking to attract a blended workforce, or does the average age of the workers in the company reflect a standard .com?
BLAKE: For the first few years, our staff reflected the young, evolving company that we were. But as we grow, TOMS is definitely looking to attract a diverse workforce. We’ve become much more aware of our needs, and therefore able to hire individuals with specific skill sets, relevant experience, and worthy knowledge. I am still the CEO and Chief Shoe Giver, and I continue to immerse myself in TOMS because it’s my passion. I have creative ideas and feverish curiosity, and my team is receptive to that. But I definitely have trust in those who are facilitating the every day, drafting direction, and establishing strategies.

Your company is for-profit. What sort of profit sharing model exists for the employees and how did you arrive at the decision to not do a nonprofit?
BLAKE: My earnings from other businesses I had started before TOMS are what kept us afloat in the earlier days- TOMS was not funded by an outside 3rd party. I never had to present a business plan or get approval, I just had trust in myself and the One for One concept. Of course people laughed when I said TOMS would give a pair of shoes away for every pair we sold, but now TOMS is proving One for One as a viable business model. Our customers have been amazing supporters since day 1.

I created TOMS as a for-profit business to ensure a sustainable way of giving. We’re able to give shoes weekly in Ethiopia, and monthly in Argentina. I also wanted to prove that you can build giving into your business model from day one and still be profitable. We get a lot of inquiries from all types of organizations wanting to get involved with TOMS in one way or another. It’s a blessing, really, but we have to be careful in these first critical years of building our brand.

You are an example of an individual whose actions will help define the generation they are in. Your generation is described as both the “me generation” and the “giving generation.” How do you think your generation should be characterized?
BLAKE: This generation is one that thrives off of action. We don’t dream about change, we make it happen. We don’t imagine a way to incorporate giving in to our daily lives- we do it. TOMS has so many young supporters who are passionate about the One for One movement, and who share the story and inspire others every day they wear their TOMS. Seeing them support this business model is proof that this generation is ready and able to create a better tomorrow.

People connect with TOMS beyond just owning another pair of shoes. There’s something more every time you slip on a pair, every time you share the story, every time you suggest a pair of TOMS as a gift because no matter what brought you to purchasing a pair of TOMS, you are making an impact on a child’s life. Will there be saturation of cause-based marketing? Most likely, but TOMS has paved the way for other entrepreneurs to incorporate giving in to their businesses.

The One for One mission is sticking with this generation, and causing a new way of thinking. We grew up with parents who were taking those first small steps, and now we are just charging full speed ahead towards a better tomorrow. We have to. One for One is proving that you can bring closure to an issue by incorporating a conscious decision in to the actions you already take- whether its as a consumer purchasing a product, or a business looking for ways to inspire a better tomorrow. It makes consumerism and philanthropy come together full circle.

Carpe Diem!

About the Author: Christine Haskell

Christine is a Senior Program Manager at Microsoft with several years experience in the .com industry. She recently started social venture labs, an idea incubator for those leading small mission-driven businesses or organizations looking to create relationships, share ideas and [...]

Lineage2, Aion, Blade And Soul

StartupNation Free Launch Assessment! Get Started Now