My name is Tim McCarthy and I am happy that you have found your way to this place at this time. Communicating and connecting with like-minded people is a personal passion of mine.
A little about myself - I am a husband, father, entrepreneur (and social entrepreneur), engaged philanthropist and teacher. In 1988, I started a company, WorkPlace Media, now the largest at-work consumer media company in the USA. I’ve been a student of the advertising and media business since 1975 when I graduated from Ohio State. 32 years later, in June of 2007, I added an MBA to my resume, also from Ohio State (Fisher School of Business).
I am a strong believer in karma, which is defined most simply as the “the conse- quence of my actions.” I try to establish meaningful relationships with everyone I meet whether at work, church or across country. My proudest business achievement is that in 19 years of building our company, our only “mission statement” was the golden rule - treat others as you wish to be treated. This was frequently repeated at our place along with a more wry statement, often used during crisis, which was “if all else fails, tell the truth.”
In 1998, combining my business knowledge with my philanthropic passion, my wife, Alice, and I founded Free Hand Inc., an organization assisting charitable non-profits with executive resources, funds and management. We “fix” broken charities. The name of “Free Hand” comes from a remark my Mom often made which was “If you’re not going to give with a free hand, don’t bother giving.”We’ve made about $1 million in investments to date and have successfully “turned around” four non-profits (and failed on about seven others).
I also love the ironies and humor of life, such as in May when the same week I sold my company to a private equity firm for multi-millions, I received a “B” in my Entrepreneurship class at OSU.
A couple hundred years ago, our nation’s first significant business “pro- fessor” Benjamin Franklin, suggested in his “lesson five” of business conduct that firms can “do well by doing good.”
Intuitively, that makes a lot of sense if you believe in a consumer based economy; developing products and
services that appeal to the needs and
wants of the individuals buying them.
But of course, consumer based economies
cut both ways. Alert systems and
medication for the elderly are developed
to fill consumer demand and change our
world for the better. Yet porn and casinos
also fill consumer demand and have not
contributed much.
So, let’s look at Franklin’s remarks a little deeper. At MBA school (I graduated in June at age 54), I was amazed to find out that business academe (at least Ohio State’s Fisher Business School professors) have expanded beyond simply teaching the theories and disciplines of making and keeping money.
They now teach that the impact business has on social change has
grown immeasurably since Ben was flying his kite.
This development of third world economies force business to consider how much will be “good” (sanitation, medical needs and nutrition) change and what evils of consumerism (greed, violence, porn) will we rain upon our brothers and sisters of this global village.
And so, upon graduation and the selling of my primary media business, I’ve decided the next chapter in my life will be as a social entrepreneur.Doing well by doing good seemed to work with my own business. We used direct media and the internet to market to our customers only if we had their permission and we treated each other as we wished to be treated. We also received awards for community service.
In May, every single person in our shop was rewarded for 19 years of blood, sweat and tears in a private equity transfer. I believe we will continue to do well by doing good.
That’s real world, personal experience. But is it broadly available? Two books I’ve read recently say “definitely.”You may have heard of the first book since Mohammed Yunis won the Nobel Prize last fall for Banker to the Poor. In this, Yunis describes the fundamental theory of his wildly successful Grameen Bank, a $5.1 billion institution whose micro credit loans have gone in small increments to over 5 million micro enterprises without collateral. This father of micro
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.credit was a professor who started in 1976 with a $27 loan to local crafts - men in his home of Bangladesh and has more than proven his theory that “poor people make good credit risks and even better entrepreneurs.”
An even broader and forward looking version of the same theory is contained in P.F. Prahalad’s book Bottom of the Pyramid which espouses the theory that the 4 billion (of 6 billion total) people on earth who earn less than $2 a day will be most helped when we “stop thinking of them as victims or burdens and recognize them as resilient and creative entrepre- neurs and value conscious consumers.” Simply put, Prahalad’s theory says businesses who can innovate their product and pricing to serve these 4 billion people (instead of feeling sorry for them) will, as Yunis did, build great businesses of which they can be proud.
A specific example of a company doing this is Technology Management Inc in Cleveland, Ohio. TMI is primarily focused on developing a fuel cell that can be mass produced and sold profitably for about $500. This cell, using renewable energy sources available in any tribal bush in Africa, for example, can provide improved water for an entire village.
If TMI is successful in this challenging but worthwhile venture, what’s their potential for “doing well” by “doing good?” Their market will consist of over 1.3 billion people who today have no access to improved water sources - let alone sanitation. And so TMI actually figures it could help end the most common third world diseases - at a profit.
Hmmmmmm. Please visit www.thebusinessofgood.org to read more inspiring articles and stories.The danger of “productizing” and “promoting” my learning about social business - which is what I do on this website - is that readers can mistakenly think that we are making the difference on the front lines. We are not.
Our job is different. We use our
foundation and this website (and
eletters and speaking engagements
and so forth) to help “spread the
virus”. We seek to learn and publicize
innovations and collaborations in
social work, named here
“the business of good.”
It’s an important role, I’m glad we are developing it, but it’s not the real work.In my view, the real work is on the ground - working directly every day with the people who need support - making a difference in their lives. The people I admire most help someone gain self esteem by developing opportunities for self reliance.
Recently, I noticed that we are getting to know a lot of people in this network of “real workers.” I’ll introduce you to a few of them here, alongPlease visit www.thebusinessofgood.org to read more inspiring articles and stories.
with their websites where you can find out more. To me, these are the real “heroes” of social ventures.
Note: I’m expecting each of these folks will now contact me and say “hey, I’m not the hero, the real “doers” in our organization are...,” but that will be a story for another day.
Rich Clark -- www.saintmartincleveland.org -- I sometimes think that if Rich were locked in a room for over an hour alone he would probably hurt himself. He is constant motion, in thought and deed. He taught in an inner city high school for many years and then was President of Cleveland St. Ignatius high school in the 90s/early 2000s. In 2003, Rich decided he had an even higher calling. Over the last five years, he’s led the development of a new inner city high school (part of a network called “Christo Rey”) that uses an innovative work-study model. Each student basically pays for their own education by working one full day a week at a local company. The company then compensates the school for a full time employee’s pay (each job has a team of five students sharing the work week). The result: providing college prep education to kids who otherwise would have no such chance. In 2008, St. Martin graduated their first 50 students, all of whom today are at universities. Amazing!
Gerald Skoch -- www.wsccenter.org -- Another friend new to me this year, Jerry is a lawyer by education and a businessperson by experi- ence. Jerry leads the 32 year old West Side (Cleveland) Catholic Center staff and volunteer force in daily service to hundreds of local indigent and voiceless with the most fundamental needs of life - food, clothing and shelter. You may particularly enjoy our featured “Success Story” this month in which Jerry outlines a unique and apparently very effective ap
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.proach to homelessness. To me, this guy is the prototype of a new age social business leader.
Sister Gladys Owuor -- www.uvipkenya.org/adozioniGB.html -- Probably my most interesting new friend this year was found in the Great Lakes region of Kenya, on our trip last month. When we arrived at the Unyolo Village project, most of the 100 children supported by the project (health services, education assistance - monetary, tutorial and arts - and family services) were at the gate to greet us. That night, we dined with the sisters then watched the children put on a talent show. The next day, Sister Gladys took us to a demonstration farm that she and her sisters have been developing on the steep banks of a river near Lake Victoria. We climbed a half mile straight down to the river then straight back up, talking all the while about her dreams and how our little family might support this effort. The sisters bring the poorest of the poor to their farm to show them how they can feed themselves by developing a garden on this acreage. Sister Gladys hero image only got bigger for me when I commented to our friend and guide, Joe Cistone, on Sister’s slender appearance. He said “oh, didn’t I tell you, she has cancer.”
So, what do we learn from these people?Is it that you and me should go into the toughest places in our world and directly serve the homeless, voiceless, uneducated and uncared for? That, even with cancer, we could work 12 hours a day on fighting over- whelming sickness and poverty in a remote village of Africa? Nope. Get real. My idea of “roughing it” is staying at a Sheraton without an indoor pool.
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.No, I’m spreading the word on these three people in order to reinforce two of the most basic lessons I’ve learned so far in creating effective social ventures:
1. I do not have to do what people like Rich and Jerry and Sister Gladys do to be effective in supporting and growing their missions. In fact, I should do only what I can do well. In my case, I will work with them to develop business disciplines. But it does them and me no good - in fact it interferes, if I try to do what they do.
2. The stories and personalities of each of these folks remind me that to give best, we should give with comfort and joy. Each of the people in this article have made me laugh. They are each, in their own way, funny and informal people.
We accomplish little by judging, being angry about our world or thinking we can “fix” it. The problems are too big to “solve” simplistically and get- ting so deep as to despair helps no one.
Instead we just need to do our little part gladly. The heroes I’ve followed not only do good works, they do them with a loving and good spirit.
Mother Theresa said, “We can do no great things, only small things with great love.”Editor ’s Note: I was pleasantly surprised by the response to my writing about our trip to Kenya last month. So, I went back and pulled my notes from a trip we took in 2005 to El Salvador, the first of three such trips we’ve now taken. Using those journal notes, I wrote this article which I hope you enjoy as well.
It never occurred to me that I might
travel to witness poverty first-hand.
I guess at another time in my life
I would wonder why anyone would
do such a thing.
On our first day in El Salvador, our
host warned us that “the next seven
days will break your heart….but don’t
worry, you’ll have the rest of your life
to put it back together again.”
The poverty indeed is something we’ve never witnessed in the USA, and Alice and I have been working for years in Cleveland’s inner city. The folks we serve here are “wealthy” by comparison.
Zaragosa and El Zeita are a small town (former) and ghetto (latter) a few miles north of San Salvador, El Salvador’s capital. Families here live inPlease visit www.thebusinessofgood.org to read more inspiring articles and stories.
“houses” that are really small rooms, cinder block or mud based with tin roofs over them. Indoor plumbing is rare and the few homes withelectricity may have it fed from the car battery of a junk car resting in a front yard.
Very, very few have a real car. Most get to where they’re going by walking and if they must go a distance they stand by the side of the road hoping one of the many repainted school buses or pick up trucks we saw picks them up.
The streets, even what pass as highways, are lined with people walking or waiting. In between the walkers you’ll see hundreds of stands where others are selling whatever they might have to sell – bracelets, coconuts, soft drinks and such. This vast marketplace is what our host called El Salvador’s “informal economy.”
Interestingly, actually startling to me is that the largest segment of El Salvador’s economy (17.1% of GDP in 2005) is called “remittances.” This is money received by families here from their relatives who have moved to the United States.
And of course there is the “polarization” that we expected to see. Statistically, the distribution of income in 2005 was 45% to the top 20% while 5.8% goes to the bottom 20%. More evident to us was seeing the gated compounds of the dozen or so families who control the military industrial complex of El Salvador only kilometers away from the resi-
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.dences of Zaragosa and El Zeita described above.This is of course not entirely different than in the USA except that it
appears a far more stark contrast.
And our last shock came with what are positioned as “security guards.” At every gas station/convenience store we were confronted by young men carrying sub-machine guns. I couldn’t help but thinking they seemed no more prepared or qualified for such duty as your own mall security people, who are unarmed.
Worse, were the pickup trucks loaded with teenagers in camouflage and similarly armed. When I asked our host who they were I was told they are the “informal army.”
El Salvador is only a little over a decade removed from terrible violence. What I thought of as war and casualties in far away times and places such as Vietnam and Iraq are much closer to us in time and distance than that.
Over 80,000 people were killed in El Salvador between 1980 and 1990. The “results” of this civil war are, to this day unclear.One site of violence that we visited, El Mazote, will stay with me forever. It’s a place where 1,300 women and children were massacred over three days in 1990. The were killed because they were related to men who had left them in their village to fight at another place. After a peace ac-
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.cord was reached, ending the majority of the violence, the site of the massacre was excavated. When 118 of the first 130 bodies exhumed were children, the excavation was ordered stopped and has never been resumed.
While we stood at this site in silence, praying quietly to ourselves, I felt a small body leaning against me. I looked down to see the face of a girl, perhaps 10 years old. Dirty, poorly dressed and wanting eyes, she reached for my hand.
I’d love to tell you I grasped it, chatted with her and shared some money and a smile with her to make her feel better. I didn’t. I fled.And that’s when our host’s words from day one came back to me. He told me my heart would be broken but he also said I’d have the rest of my life to put it back together again.
So, since that day, I’ve been engaged with the folks of Zaragosa and El Zeita on many fronts. To speak of our work smacks of righteousness to me so I’ll just say that the feeling I get every time we make some
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.progress there reminds me of the promise I made silently to that little girl that day as I watched and waved to her as our bus drove off.
“You will be my inspiration to make a difference and I will pray that work somehow affects you directly.”
So, I wonder, if nothing happens without sales, why do most people avoid it?
Maybe we just hate rejection. In business, no one wants to be told a client no longer loves you. And who wants to hear from a friend that they won’t pay to attend a fund raising reception with you?
This thought leads to the purpose of this article. That is, during this diffi - cult economy when there is less total money available, we have to work harder and smarter to generate revenue.
During the boom times (and our boom was a very long boom) almost anyPlease visit www.thebusinessofgood.org to read more inspiring articles and stories.
sales strategy worked. Traditional methods were fine, whether you were in the advertising business or the fund raising business.
On the business side, I’m less sure that innovation is the answer. I believe in fact that our main business partnerships must simply go back to the fundamentals of reaching out to more prospects and getting in front of them.
We are in a situation much like that old United Airlines television com - mercial where the boss gathers everyone in the conference room to tell them they just lost their biggest client. The folks in the room ask “what are we going to do about it?” and he walks around handing each one an airline ticket to the city where their clients are and says “we’re going to go and visit all our clients.”
The punch line is when they say “what are you going to do”, the boss shows them his airline ticket and says “I’m going to visit the client we just lost.”
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.The businesses that will make it to the other side of this mess will be the ones who hunker down and do what they already do well, better. And they will raise their revenue simply by getting out there and being with their clients and prospects more.
It’s different in fund raising, in my opinion.That is, there are only so many golf outings and auctions people can attend, particularly if they just lost their job. And direct mail has been on the decline for years so how would we expect that to get better in a re- cession?
Donors’ budgets are dwindling with their
stock market holdings and non-profit
endowments are suffering in the market’s
dive as well.
But something even more threatening,
something that began before the crash,
is that our donor profile is changing
dramatically. The number of people
who are happy to just write a check
and be happy to see their name in your
program is decreasing rapidly.
Please visit www.thebusinessofgood.org to read more inspiring articles and stories.
On the other hand, the people who want to ENGAGE in philanthropy and in social business ventures are on the rise, led by unique and diverse characters such as Warren Buffett, Bill Gates, Sergey Brin, Bill Shore and Muhammad Yunus.Our website’s featured “Bookshelf” reading for the month of March 2009 is Yunus’ new book, “Creating a World Without Poverty.” Among other points, the book relates to the need for new revenue generating models for our missions. Yunus believes we are in a time of great change in the business of good and st