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9 Social Impact Models That Entrepreneurs Can Learn From

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September 19, 2020 8 min read

Opinions expressed by Entrepreneur contributors are their own.

As a leader, I try to positively impact my whenever possible. Whether its youth programs, gender equity, career coaching, or anti-violence, we (Complete SET agency) create educational themed events as well as donate portions of revenue to . Cause models like this, whether grassroots or multinational, are increasingly important for businesses, large and small, to have at their operational core. Ensuring that your is creating a positive impact is a necessary competitive advantage. In fact, a 2018 Conecomm survey found that 78 percent of Americans now expect companies to go beyond profits and to also positively impact society. Social impact is a broad term that refers to the positive change businesses have on their community. A company’s emphasis on a level of , or CSR, can be an integral part of making your business more appealing to clients, employees, vendors, and investors.

Related: Why Philanthropy Is Good Business

I spoke with Harrie Bakst, co-founder of WCPG, a leading firm that specializes in and consumer engagement with teams, leagues, athletes, celebrities, and brands. “As we move ahead in a new world, cause marketing and social responsibility for brands have gone from being an add-on to a must-have as part of consumer engagement,” Bakst says. “If you are a leading a company today you have reevaluated and expanded your messaging and ties to all forms of community engagement as it is now one of the first things people are looking and asking for.”

Given the many benefits that come from social impact, it’s important for entrepreneurs to be aware of some of the leading socially conscious businesses. Here is a list of the companies that excel in cause marketing and social change. This is a cross-section of various industries and company size, and each included business has a CSR focus that entrepreneurs can learn from. 

VKTRY

VKTRY Insoles may not seem like the sexiest of products, but their exclusive designed carbon fiber insoles have helped reduce injury and improve performance of over 300 NFL players and countless Olympians in the past few years, as well as MLB stars like Fernando Tatis Jr. and Vlad Guerreo Jr. However their biggest impact may be to those on their feet all day; first responders, government officials, and healthcare workers. That’s why the company, based in Connecticut, launched VKTRY4Heroes in March. With the help of Cleveland Browns’ rising star running back Nick Chubb, the company provides thousands of pairs of the pricey but effective shoe insoles to healthcare workers from around the country at no cost, helping those on the front lines stay healthy and focused.  

KissCam

The KissCam is recognized globally in sporting venues worldwide. KissCam, LLC acquired the trademark and developed a patented mobile app that enables fans to participate in the excitement of being featured on arena screens. With this season’s empty sports venues, KissCam offers teams and leagues an excellent vehicle to enhance the fan experience without game-goers ever leaving their living room coach. The company has pledged a donation structure into its clash flows. KissCam keeps games fun and passionate for fans, but also can make a lasting positive change in the community with its donations.

Playmaker

Playmaker is a hybrid media, merchandise, and music company. They have an apparel collection designed for social causes including, for example, basketballs printed with names of victims of police brutality. Playmaker has been able to leverage their global exposure (with social media followers in the tens of millions) to give a site-wide percentage of net proceeds to funds like Feeding America, Covid-19 relief, and more. “The reality in our industry is that the people we celebrate the most and that inspire us are the same people that are marginalized and need support at this time,” Playmaker founder and president Brandon Harris said.  “It is unacceptable and also predatory for brands in sports to not make social change a major initiative.” 

Celsius

The fitness drink company has put together a giveback initiative with product drops around the country at firehouses and hospitals for those on the front lines. Celsius has delivered over 7,000 cases of their product to hospitals around the country. The company also offers first responders / healthcare workers a case of their energy drinks if they DM the Celsius Instagram page with a picture of their work ID. This is a creative way to build positive awareness and association for your brand. 

Related: 4 Strategies to Build a Stronger Brand Through Philanthropy

Flatiron Health

Launched in 2012, Flatiron Health is a healthcare tech company that strives to improve lives by learning from the experience of every cancer patient. The founders of Flatiron Health realized that cancer data has long been unstructured and difficult to use. Flatiron Health was founded to address that problem by organizing and standardizing data from cancer patients. 

They currently have organized more than two million patient records that can be used for research. Working with more than 280 community oncology practices as well as the FDA and NCI, they serve as a key facilitator for cancer research and for improving patient experiences. Recognizing and addressing a relatively simple but important issue, Flatiron Health provides an important model for innovation that can lead to a successful and impactful company. 

Good Sports

For three seasons, the monthly Fox Sports television show “Power of Sports” has traveled to cities across the United States every month to showcase how teams, athletes, and organizations use sports to make a positive impact in their communities. I have worked as a producer of the show, now rebranded as “Good Sports” in June 2020. The show started season four in September and has now expanded to all of the regional sports networks under the Sinclair Broadcast Group’s umbrella. With more than 120 airings a month, “Good Sports” shines a spotlight on sports’ intrinsic ability to spark positive change. “In every city, there are dozens of great stories of how people are leveraging sports to teach, to inspire and to raise up underserved youth,” show host Rick Horrow says. “Our goal from the start was to inspire others to embrace the inherent power of sports as a method of outreach.” Good Sports also has a robust digital presence, attracting more than two million views on their YouTube channel which extends their message for social change tremendously. 

Ready Nutrition

Ready Nutrition founder Pat Cavanaugh built his business around healthy lifestyles and social responsibility. The company, based in Pittsburgh and projecting over $100 million in sales in the heavily competitive drink and energy business, took on two elite investors this past year (two-time NFL Defensive Player of the Year Aaron Donald of the LA Rams and NBA MVP Giannis Antetokounmpo of the Milwaukee Bucks), and immediately set out to find ways to give products to first responders helping fight Covid-19 and kids who were struggling with remote learning and isolation. Ready Nutrition had the two stars target organizations that needed their help and delivered thousands of their protein drink to the hardest hit hospitals in places like Pittsburgh, Los Angeles, Milwaukee, and New York. They also delivered thousands of bottles to first responders fighting the California wildfires, and have implemented a program tying their bottles to tell positive stories of race relations through their partnership with the AAU and the Black Lives Matter movement. 

Strat-O-Matic

This popular board game has a free supplementary platform, Strat School, that can help young students, especially budding sports fans, learn math, writing, and more. The educational platform also offers detailed lesson plans for teachers and parents interested in using the game as a teaching device. For example, Strat-O-Matic Baseball Express helps children learn about making decisions using probability, computing statistics like batting average and ERA, and developing writing skills with simple game recaps, among others. The emphasis on math and statistics and quick computation comes with each dice roll and ways to encourage students to learn more about the players from sets like the Hall of Famers and Negro League Stars. How often is this particular batter likely to get a hit or home run? Which relief pitcher would be most effective against the upcoming batter? How is ERA calculated? What are the key moments of the game to include in a written recap? What more can students learn about particular historically significant players? In the fun environment of playing Strat-O-Matic baseball, all of these educational benefits are possible. Not bad for a board game.

Related: How to Build Philanthropy Into Your Budget — Even If You’re Not Google

Unilever

Unilever’s first-ever social impact brand started in-house, the head to toe soap brand gives away 30 percent of their proceeds to fund mobile shower units for the homeless. They launched exclusively in Whole Foods in 2019 and are now in Bed, Bath, and Beyond and Walmart.com among others. 

Social impact is currently more important than ever. As a result, all entrepreneurs should familiarize themselves with companies that are committed to social impact and that are reaping the benefits from this commitment. Doing so will not only help to make your business more meaningful, but it will also help you to recruit and retain the best talent and make your business more appealing to customers, vendors, and investors.

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The Trump campaign celebrated a growth record that Democrats downplayed.

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The White House celebrated economic growth numbers for the third quarter released on Thursday, even as Joseph R. Biden Jr.’s presidential campaign sought to throw cold water on the report — the last major data release leading up to the Nov. 3 election — and warned that the economic recovery was losing steam.

The economy grew at a record pace last quarter, but the upswing was a partial bounce-back after an enormous decline and left the economy smaller than it was before the pandemic. The White House took no notice of those glum caveats.

“This record economic growth is absolute validation of President Trump’s policies, which create jobs and opportunities for Americans in every corner of the country,” Mr. Trump’s re-election campaign said in a statement, highlighting a rebound of 33.1 percent at an annualized rate. Mr. Trump heralded the data on Twitter, posting that he was “so glad” that the number had come out before Election Day.

The annualized rate that the White House emphasized extrapolates growth numbers as if the current pace held up for a year, and risks overstating big swings. Because the economy’s growth has been so volatile amid the pandemic, economists have urged focusing on quarterly numbers.

Those showed a 7.4 percent gain in the third quarter. That rebound, by far the biggest since reliable statistics began after World War II, still leaves the economy short of its pre-pandemic levels. The pace of recovery has also slowed, and now coronavirus cases are rising again across much of the United States, raising the prospect of further pullback.

“The recovery is stalling out, thanks to Trump’s refusal to have a serious plan to deal with Covid or to pass a new economic relief plan for workers, small businesses and communities,” Mr. Biden’s campaign said in a release ahead of Thursday’s report. The rebound was widely expected, and the campaign characterized it as “a partial return from a catastrophic hit.”

Economists have warned that the recovery could face serious roadblocks ahead. Temporary measures meant to shore up households and businesses — including unemployment insurance supplements and forgivable loans — have run dry. Swaths of the service sector remain shut down as the virus continues to spread, and job losses that were temporary are increasingly turning permanent.

“With coronavirus infections hitting a record high in recent days and any additional fiscal stimulus unlikely to arrive until, at the earliest, the start of next year, further progress will be much slower,” Paul Ashworth, chief United States economist at Capital Economics, wrote in a note following the report.

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Black and Hispanic workers, especially women, lag in the U.S. economic recovery.

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The surge in economic output in the third quarter set a record, but the recovery isn’t reaching everyone.

Economists have long warned that aggregate statistics like gross domestic product can obscure important differences beneath the surface. In the aftermath of the last recession, for example, G.D.P. returned to its previous level in early 2011, even as poverty rates remained high and the unemployment rate for Black Americans was above 15 percent.

Aggregate statistics could be even more misleading during the current crisis. The job losses in the initial months of the pandemic disproportionately struck low-wage service workers, many of them Black and Hispanic women. Service-sector jobs have been slow to return, while school closings are keeping many parents, especially mothers, from returning to work. Nearly half a million Hispanic women have left the labor force over the last three months.

“If we’re thinking that the economy is recovering completely and uniformly, that is simply not the case,” said Michelle Holder, an economist at John Jay College in New York. “This rebound is unevenly distributed along racial and gender lines.”

The G.D.P. report released Thursday doesn’t break down the data by race, sex or income. But other sources make the disparities clear. A pair of studies by researchers at the Urban Institute released this week found that Black and Hispanic adults were more likely to have lost jobs or income since March, and were twice as likely as white adults to experience food insecurity in September.

The financial impact of the pandemic hit many of the families that were least able to afford it, even as white-collar workers were largely spared, said Michael Karpman, an Urban Institute researcher and one of the studies’ authors.

“A lot of people who were already in a precarious position before the pandemic are now in worse shape, whereas people who were better off have generally been faring better financially,” he said.

Federal relief programs, such as expanded unemployment benefits, helped offset the damage for many families in the first months of the pandemic. But those programs have mostly ended, and talks to revive them have stalled in Washington. With virus cases surging in much of the country, Mr. Karpman warned, the economic toll could increase.

“There could be a lot more hardship coming up this winter if there’s not more relief from Congress, with the impact falling disproportionately on Black and Hispanic workers and their families,” he said.

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Ant Challenged Beijing and Prospered. Now It Toes the Line.

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As Jack Ma of Alibaba helped turn China into the world’s biggest e-commerce market over the past two decades, he was also vowing to pull off a more audacious transformation.

“If the banks don’t change, we’ll change the banks,” he said in 2008, decrying how hard it was for small businesses in China to borrow from government-run lenders.

“The financial industry needs disrupters,” he told People’s Daily, the official Communist Party newspaper, a few years later. His goal, he said, was to make banks and other state-owned enterprises “feel unwell.”

The scope of Mr. Ma’s success is becoming clearer. The vehicle for his financial-technology ambitions, an Alibaba spinoff called Ant Group, is preparing for the largest initial public offering on record. Ant is set to raise $34 billion by selling its shares to the public in Hong Kong and Shanghai, according to stock exchange documents released on Monday. After the listing, Ant would be worth around $310 billion, much more than many global banks.

The company is going public not as a scrappy upstart, but as a leviathan deeply dependent on the good will of the government Mr. Ma once relished prodding.

More than 730 million people use Ant’s Alipay app every month to pay for lunch, invest their savings and shop on credit. Yet Alipay’s size and importance have made it an inevitable target for China’s regulators, which have already brought its business to heel in certain areas.

These days, Ant talks mostly about creating partnerships with big banks, not disrupting or supplanting them. Several government-owned funds and institutions are Ant shareholders and stand to profit handsomely from the public offering.

The question now is how much higher Ant can fly without provoking the Chinese authorities into clipping its wings further.

Excitable investors see Ant as a buzzy internet innovator. The risk is that it becomes more like a heavily regulated “financial digital utility,” said Fraser Howie, the co-author of “Red Capitalism: The Fragile Financial Foundation of China’s Extraordinary Rise.”

“Utility stocks, as far as I remember, were not the ones to be seen as the most exciting,” Mr. Howie said.

Ant declined to comment, citing the quiet period demanded by regulators before its share sale.

The company has played give-and-take with Beijing for years. As smartphone payments became ubiquitous in China, Ant found itself managing huge piles of money in Alipay users’ virtual wallets. The central bank made it park those funds in special accounts where they would earn minimal interest.

After people piled into an easy-to-use investment fund inside Alipay, the government forced the fund to shed risk and lower returns. Regulators curbed a plan to use Alipay data as the basis for a credit-scoring system akin to Americans’ FICO scores.

China’s Supreme Court this summer capped interest rates for consumer loans, though it was unclear how the ceiling would apply to Ant. The central bank is preparing a new virtual currency that could compete against Alipay and another digital wallet, the messaging app WeChat, as an everyday payment tool.

Ant has learned ways of keeping the authorities on its side. Mr. Ma once boasted at the World Economic Forum in Davos, Switzerland, about never taking money from the Chinese government. Today, funds associated with China’s social security system, its sovereign wealth fund, a state-owned life insurance company and the national postal carrier hold stakes in Ant. The I.P.O. is likely to increase the value of their holdings considerably.

“That’s how the state gets its payoff,” Mr. Howie said. With Ant, he said, “the line between state-owned enterprise and private enterprise is highly, highly blurred.”

China, in less than two generations, went from having a state-planned financial system to being at the global vanguard of internet finance, with trillions of dollars in transactions being made on mobile devices each year. Alipay had a lot to do with it.

Alibaba created the service in the early 2000s to hold payments for online purchases in escrow. Its broader usefulness quickly became clear in a country that mostly missed out on the credit card era. Features were added and users piled in. It became impossible for regulators and banks not to see the app as a threat.

ImageAnt Group’s headquarters in Hangzhou, China.
Credit…Alex Plavevski/EPA, via Shutterstock

A big test came when Ant began making an offer to Alipay users: Park your money in a section of the app called Yu’ebao, which means “leftover treasure,” and we will pay you more than the low rates fixed by the government at banks.

People could invest as much or as little as they wanted, making them feel like they were putting their pocket change to use. Yu’ebao was a hit, becoming one of the world’s largest money market funds.

The banks were terrified. One commentator for a state broadcaster called the fund a “vampire” and a “parasite.”

Still, “all the main regulators remained unanimous in saying that this was a positive thing for the Chinese financial system,” said Martin Chorzempa, a research fellow at the Peterson Institute for International Economics in Washington.

“If you can’t actually reform the banks,” Mr. Chorzempa said, “you can inject more competition.”

But then came worries about shadowy, unregulated corners of finance and the dangers they posed to the wider economy. Today, Chinese regulators are tightening supervision of financial holding companies, Ant included. Beijing has kept close watch on the financial instruments that small lenders create out of their consumer loans and sell to investors. Such securities help Ant fund some of its lending. But they also amplify the blowup if too many of those loans aren’t repaid.

“Those kinds of derivative products are something the government is really concerned about,” said Tian X. Hou, founder of the research firm TH Data Capital. Given Ant’s size, she said, “the government should be concerned.”

The broader worry for China is about growing levels of household debt. Beijing wants to cultivate a consumer economy, but excessive borrowing could eventually weigh on people’s spending power. The names of two of Alipay’s popular credit functions, Huabei and Jiebei, are jaunty invitations to spend and borrow.

Huang Ling, 22, started using Huabei when she was in high school. At the time, she didn’t qualify for a credit card. With Huabei’s help, she bought a drone, a scooter, a laptop and more.

The credit line made her feel rich. It also made her realize that if she actually wanted to be rich, she had to get busy.

“Living beyond my means forced me to work harder,” Ms. Huang said.

First, she opened a clothing shop in her hometown, Nanchang, in southeastern China. Then she started an advertising company in the inland metropolis of Chongqing. When the business needed cash, she borrowed from Jiebei.

Online shopping became a way to soothe daily anxieties, and Ms. Huang sometimes racked up thousands of dollars in Huabei bills, which only made her even more anxious. When the pandemic slammed her business, she started falling behind on her payments. That cast her into a deep depression.

Finally, early this month, with her parents’ help, she paid off her debts and closed her Huabei and Jiebei accounts. She felt “elated,” she said.

China’s recent troubles with freewheeling online loan platforms have put the government under pressure to protect ordinary borrowers.

Ant is helped by the fact that its business lines up with many of the Chinese leadership’s priorities: encouraging entrepreneurship and financial inclusion, and expanding the middle class. This year, the company helped the eastern city of Hangzhou, where it is based, set up an early version of the government’s app-based system for dictating coronavirus quarantines.

Such coziness is bound to raise hackles overseas. In Washington, Chinese tech companies that are seen as close to the government are radioactive.

In January 2017, Eric Jing, then Ant’s chief executive, said the company aimed to be serving two billion users worldwide within a decade. Shortly after, Ant announced that it was acquiring the money transfer company MoneyGram to increase its U.S. footprint. By the following January, the deal was dead, thwarted by data security concerns.

More recently, top officials in the Trump administration have discussed whether to place Ant Group on the so-called entity list, which prohibits foreign companies from purchasing American products. Officials from the State Department have suggested that an interagency committee, which also includes officials from the departments of defense, commerce and energy, review Ant for the potential entity listing, according to three people familiar with the matter.

Ant does not talk much anymore about expanding in the United States.

Ana Swanson contributed reporting.

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