Consultant: Brad Brown, principal, Socentia
Having served as the executive director of Social Venture Partners Minnesota
, Brad Brown now uses his extensive experience in the area of social enterprises to operate his own social venture consulting company, Socentia. The Minneapolis-based firm provides consultation and coaching for social venture leaders, philanthropists, and investors committed to solving social challenges in the areas of economic opportunity, education, environmental sustainability, and health care. Socentia assists social ventures seeking to grow their impact and scale, as well as social venture investors who want to increase their social return on investment.
On what most social ventures need:
“I believe running a successful social business is much tougher than running a successful traditional business because you must constantly balance the need to be profitable with maintaining your social mission focus. So you need to go into it with that understanding. The business model has to work because an ineffective business model means you aren’t going to be able to financially sustain the social mission.”
Leader: Kevin Lynch, president and CEO, Social Enterprise Alliance
As the leader of the Social Enterprise Alliance, Kevin Lynch works to create massive social impact by elevating the success of social enterprises. Headquartered in Minnetonka, the national organization has about 1,000 members, representing a nearly 50-percent growth over the past two years. The Twin Cities chapter is one of the largest and most robust, reflecting the desire of those in the area’s social enterprise space to connect with each other and build an ecosystem where social enterprise can thrive.
On the advantages of Minnesota as a national headquarters:
“For one, Minnesota has one of the strongest social enterprise sectors in the U.S., and as such is a great location. Two, the talent pool from which I could build my staff is deep, broad, and committed. Three, the cost of doing business and acquiring talent here is a fraction of a city like Washington, D.C., New York City, or San Francisco.”
Connector: John Stavig, professional director, Gary S. Holmes Center for Entrepreneurship
As the program director of the Gary S. Holmes Center for Entrepreneurship, John Stavig helps connect semi-finalists in the social entrepreneur division of the Minnesota Cup with mentors providing feedback on business strategy. Launched in 2005, the Minnesota Cup is a statewide new venture competition (see breakthroughideas.org). Its social entrepreneur division seeks, supports, and celebrates innovative and effective social entrepreneurs and the organizations they lead. The division winner receives an operating grant, consulting from Social Venture Partners Minnesota, and other benefits.
On how the event helps social entrepreneurs:
“My role is connecting the semi-finalists with one or two mentors that can provide feedback on their [business] plan and provide advice moving forward. The bigger benefit to the companies participating in the event is the connection that they make going through the process, as well as the advice that they get from some of the mentors.”
Attorney: Kimberly Lowe, attorney and shareholder, Fredrikson & Byron, P.A.
Specializing in corporate finance, with an emphasis on tax-exempt organizations and emerging businesses, Fredrikson & Byron
attorney Kimberly Lowe was part of the team that helped the Minnesota Benefit Corporation Act become a reality. The act was signed into law in April and will become effective on January 1, 2015. It helps facilitate the creation of social enterprises or “benefit corporations” — for-profit entities that have a social mission or purpose. The act allows entrepreneurs to form these types of businesses themselves, without engaging legal counsel. It also provides a new legal status (besides Inc., Ltd., or nonprofit) and recognition. On the advantages of the act:
“For social businesses, it’s important to be identified as conducting their business in a way that meets these standards. Entrepreneurs want to be clearly identified with their value propositions; by forming an entity under the [act], it tells people this is how they operate their business. [The act] will help keep our entrepreneurs here, and help us understand the other benefit corporations that are coming to Minnesota.”
Investor: Jeanne Voigt, social enterprise investor, IMNPACT Angels
The state’s first angel network devoted to impact investing, IMNPACT Angels
focuses on investing in companies and organizations to help generate social and environmental impact, alongside a financial return. Many impact investors are also active philanthropic donors, and see impact investing as another way to use their money to help solve social problems. IMNPACT Angels members must be accredited investors, pay an annual membership fee, and be willing to commit to a minimum of $25,000 in investments over a two-year period.On the importance of investing in social enterprises:
“I love this area of investing because it doesn’t just create products like many startups. It solves problems — sometimes, big problems. I also think that involvement with successful entrepreneurs and other business types brings needed best practices to these idealistic problem-solvers.”