Article 5
Attaching social benefit to your business as it scales
1-2 minute read
CAPSULE SUMMARY – You can find multiple ways to attach societal benefit to your existing business engine, such that the larger and more successful you are, the greater the societal impact.
5.1 For the millions of businesses remaining that aren’t de-facto socially good or purpose-driven, the second lever to explore is to create an attached social benefit to your business model. Put simply, find creative ways so that when your business succeeds, you create a clear and direct societal benefit in parallel.
5.2 There are countless ways to attach this kind of social lift to your business. When Tom’s Shoes initially launched, purchasing any pair of shoes would create a shoe donation to someone in need. Over 100M pairs of shoes were distributed due to this approach. And using the same model, Warby Parker has distributed over ten million prescription glasses to those in need.
5.3 Of course, this model doesn’t have to rely on a simple one-for-one giveaway model. Walmart requires that its suppliers shift into more efficient and recyclable packaging (all packaging from its suppliers must be 100% recyclable by 2030) such that the more it sells the larger the impact footprint. Evite has raised over $30M in donations for non-profits by attaching a simple and free donation option into its invitation flow. The more people use its service, the more donations get generated. Novartis has explicitly committed to ensuring affordable distribution and pricing for every new medicine it releases— ensuring its medical breakthroughs can benefit everyone, not just those living in wealthy countries.
5.4 Finding the right attachment opportunity for your business can be as simple as asking the fundamental question: what social good can we naturally attach to our business model such that the larger we grow, the greater the social benefit? The possibilities are limited only by your imagination.
Look for creative ways to create positive impact that grows in lockstep with your business.
5.5 Testing the validity of your approach is even simpler. Just ask yourself two questions. Number one: if your business grows to 5x its current size, will you create a 5x social improvement along with that growth? And number two: if you were to succeed at the absolute limit of success (say 100% market share for your product), would the world be in a better place? If you have found something that both scales along with your business and holds true in the limit, then you have found an excellent candidate.
5.6 Of course, any kind of attachment to a business model will come with trade-offs, either in real dollars or in opportunity costs of some kind (hence the tension in the balance). I’ll address the thorny issue of how much social impact is good enough? in later sections around ROI and measurement.