Dr. Gerry Bell on Leadership, Listening, Happiness and Peak Performance

Session 1, Dr. Gerry Bell
EO/MIT Entrepreneurial Masters Program
Year Two, June 17, 2010

I’m in Boston for a few days attending year two of the EO/MIT Entrepreneur Masters Program. Our first presenter this morning is Dr. Gerry Bell of my hometown Chapel Hill, NC from the Bell Leadership Institute. Here are the notes from the session.

The 6 Laws of listening:

1. You can’t listen and work at the same time.
2. You can’t listen and think at the same time.
3. There is no such thing as multitasking.
4. Everyone knows exactly when you stopped listening.
5. You can’t fake listening. You can’t pretend to listen. You can’t fool people.
6. People only tell you the truth when they think you’re capable of hearing it.

You can’t afford to live your life on the surface. Listen and you will go deeper.

When you’re listening, ask questions to clarify what people are saying and elicit additional information.

If you find you’re uninterested and eyes are glazing over, ask a clarifying question.

A good tool to get people to open up a bit is to say, “Can you tell me more about that?”

There’s a thousand pieces to the puzzle of most meaningful conversations. A lot of times the real meaning to why someone is saying what they are to you cannot be determined in level I.

Class comment: Active listening is foreplay for a woman.

Playback what people are saying to you when talking about deep or important issues.

Never say, “well I disagree with you.”It just throws down the gauntlet and won’t lead to positive results. (’Yes and’ them instead of ‘No, but’ them)

Listening is the essential skill to build an understanding of people.

You can learn to listen better.

Living With Authenticity

There is no other way to live than living with authenticity.

You live longer when you’re authentic and you’re profoundly happier.

We experience stress when we behave differently than we are.

People say “I’m going to start being myself when this happens.” Don’t miss life while you’re living it.

As yourself if you’re going to listen to this person, or not. Make a black or white decision. Don’t half listen. Either 100% listen or delay the conversation.

Say, “I’d love to see you, I’ve got a deadline. Let’s discuss this at XX time.” Be pleasant, look at them, smile, and move on and then come back to it when you can focus.

Whenever you go to talk to someone, ask them if this is a good time.

Live authentic, open, and clear.

Emails/texts should only be used for surface level communications (level 1). The more personal it is, the more important it is to talk in person or at least by phone.

You have to guard your time as much as your money.

Skills Needed to Make Money

• Technical Skills/Specialty Skills
• Commitment: Ability to commit yourself with deep 100% focus on what you’re doing
• Interpersonal & Leadership Skills

Commitment is built by loving the work you do and being able to enter flow. The worst thing that could happen to you is to wake up and not love going to work. Make sure you’re doing things you love to do for your profession. Make sure you wake up and are so excited you can’t stand it.

Your personality dictates how you lead. You better be great in people skills to build a successful organization. Invest in yourself to build yourself. The smartest decision in someone’s life is to build themselves. Work on your people skills before you have kids as your kids will inherit your personality weaknesses. Your childrens life will be better if you invest in yourself. Your business will do better if people like you. People do business with people they like.

Warren Buffet has made $50B and his conclusion was ‘invest in yourself.’ He said ‘take communication courses.’

The best leaders are outstanding with people. The worst leaders are not good with people.

Living a Great Life

Boredom will make you crazy. You should never never never never retire. If you retire to go play you are likely to have the most unhappy period of your life. A lot of people sell their business to recover their happiness. Don’t do that, change your business. To have a great life you have to be exhilarated about getting up.

You have to create your life so every day you wake up you love life. Don’t ‘make a lot of money so that you can have your life back later.’ You can actually make more money by focusing on doing what you love to do, because you’ll be passionate about it.

Dr. Bell studies peak performance in a complex life. It is possible and is looking at examples of how to do it to stay at prime.

Don’t overwork as then you’ll burn out and want to quit.

Peak Performance

When were you most engaged? What caused this?

When were you least engaged? What caused this?

You cannot produce better than when you are in prime. Performance comes on a bell curve. You are best at 100mph, not 200mph.

You have a significant increase of illness when you work too hard. Hiatal hernia, heart disease. You have significant increase of destroying your relationships with spouse, kids, parents. You become flat and you dislike what you do. You’re unhappy. The happiest time is when you’re at prime. You can’t have more fun and have a greater impact on humanity when you’re at prime.

If you’re going 115mph you become grumpy, irritable, impatient, and don’t sleep well. You die early.

It’s hard to contribute to humankind if you’re dead.

If you love it, working long hours is not bad. If you don’t love it and your strained, it is bad.

Don’t work like a dog until you’re 50 and then wake up and have no health, no spouse, no family.

Every day you wake up your goal should be to have the best day you’ve ever lived.

Do great work every day.

We’re in the 21st century of understanding science and in the 1st century of understanding people. The secret to make the world a better place is to have great leaders who build businesses who provide jobs who are worthy of human life and someone can go home and buy food for their children, and have shelter, and educate them.

When you go through the slums of Sao Paolo or Somalia, the only solution will be if people who are entrepreneurs build businesses so people can have jobs.

Great leaders build great companies. Average leaders build average companies. Poor leaders destroy companies.

The 7 Causes of Happiness or Unhappiness

1. Yourself
   Do you like yourself or not? You have to like yourself to be happy. If you don’t like yourself, money is irrelevant. Invest in yourself and helping your children become effective, achieving, happy people.
2. Loving Relationships
   You don’t have to be married, but you have to have the ability to love. If you can’t love you’re missing one of the joys of life. This is a genetic need of human species.
3. Health
   The biggest single mistake people make is to throw away their health and abuse themselves. Be as good at mastering your health as your business. You can’t make the world a better place if you’re not here. The average human body is designed to live to 100. 70% of life expectancy is lifestyle, not genetics. Do you love being alive? If you do, you should set a goal to be alive as long as you can. Don’t throw away your health and then at 60 try to start over. Set a goal to live to 100. Do you want to see your grandkids? We are thoroughbreds in the Kentucky Derby and we need to train to be able to perform.
4. Work
   Can be the greatest joy or greatest pain. Make sure you’re working on what you love doing.
5. Money
   It’s not how much you have, it’s how you see it. Do not make your childrens’ lives easy with your money. Rather teach them skills to solve their own problems. Make sure your child has a job by age 11. Work ethic is ingrained by age 12. We got to be successful because we learned to work early.
6. Spirituality and Community
   Feeling of giving back and contributing to the world. When you leave the world leaving it better off than when you.
7. Fun
   You should have as much fun as humanly possible without destroying your work, family, marriage. You normally drink as much as you don’t like yourself. Drinking dulls your senses.

Develop Your Six Core Compentencies on Being a Great Leader

1. The Entrepreneur
   Initiator, developer, seeks and finds opportunities, seeks success and achievements, positive can-do attitude, high goal setter
2. The Competitor
   Assertive, honest, faces problems squarely, raises the bar, rises to the challenge, makes the tough decisions well
3. The Producer
   Focus on getting things done, organized, takes leadership, does it now and gets it done, a finisher, streamlines work, maintains focus and priorities, highly disciplined
4. The Stabilizer
   Recovers quickly from mistakes and failures, has confidence, cool under pressure, calm, balances priorities and time, paces self, careful
5. The Team Builder
   Good listener, giving, supportive, builds teamwork, gives love and affective easily, mixes easily with others
6. The Creator
   Innovative, flexible, fun, good sense of humor, strategic thinker, adapts easily to change

Manage Around and Reduce Your Six Extreme Personality Pattens

1. The Performer
   Overly ambitious, takes too many risks, prpmises more than can delivery, manipulates people for own success, over extends self and others
2. The Attacker
   Too critical, fault finding, disrespectful, too aggressive, argumentative, rude and abrupt, destroys teams, destroys relationships, makes people afraid of you
3. The Commander
   Domineering, rigid, controlling, inflexible, overly analytical, micromanager
4. The Avoider
   Too cautious, avoids risks, does not take initiative, is afraid to fail, too detail oriented
5. The Pleaser
   Too nice, allows others to take advantage, smooths over conflicts, backs down from competition, too agreeable, won’t fire anyone
6. The Drifter
   Disorganized, messy, impulsive, starts things and doesn’t finish, short attention span. If this is you, build your ‘Producer’

Make your goal to be every person you see, when you’re done seeing them, they feel better. Be open and caring toward people. Everyone you see and talk to wants to be talked to. Don’t be cold, critical, or hostile.

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Presenter Bio:
Dr. Gerald D. Bell, founder and CEO of Bell Leadership Institute, is a leading consultant to major business organizations throughout the world. He is also an award-winning professor, rated by Forbes Magazine as a “Don’t Miss,” at the Kenan-Flagler Business School at the University of North Carolina-Chapel Hill. Dr. Bell’s cross-industry experience and in-depth expertise have earned him a reputation as one of the most sought-after keynote speakers and effective resources on leadership in the United States and abroad. [Full Bio]

iContact, Nourish, and Life Update

I’ve been super focused the last six weeks on iContact and Nourish since making it back from Skoll World Forum and the Icelandic volcano.

iContact Update

The baby that Aaron and I started way back in 2003 is now 7 years old (see our company picture below).

We’ve hired 45 new team members so far in 2010. iContact has now passed 200 employees and 63,000 customers and are at a $37M annualized revenue run-rate. Here we come $100M.

We’re working to build a ‘great global company, based here in North Carolina, for our customers, employees, and community.’ Our 2020 mission is to be the largest global provider of email marketing software and services to the Small Business and Mid-Sized Business market.

Recently iContact has come out with and announced:

• iContact for the iPhone
• iContact for Salesforce
• iContactPlus
• A preview of our new MessageBuilder
• iContact’s new blog – ‘The Official Email Blog’
• BusinessFuel – our small business resource center
• iContactTV – Our YouTube Channel

iContact’s Social Responsibility

In May, Matt Kopac  joined iContact, helping us with our social and environmental responsibility work. Matt is helping iContact become a B Corporation (for-benefit corporation), create a system to quantify our social and environmental impact, and prepare for writing our 2010 Corporate Social Responsibility (CSR) Report. Matt is comes to us from Yale University where he finished in MBA in 2009. Matt has worked in the Peace Corps in Benin and for VisionSpring in El Salvidor.

Making iContact a  Triple Bottom Line (TBL) Company

A triple bottom line company is a company that focuses on its financial results, social results, and environmental results. This three-pronged measurement system also goes by the moniker of “Profit, People, Planet.” iContact already measures and report on our financial results religiously.

We are now setting up a system to measure our social results and our environmental results. My hope is that iContact can become a global example of a socially responsible triple-bottom line venture-backed technology company. My strong belief is that by measuring and focusing on social impact and environmental impact, financial results are actually improved and not the other way around. We are just at the beginning of this process.

We’ve got even more exciting things to share that we will announce by the end of July including our first acquisition and something so wonderful I can’t even allude to it…

Nourish Updates

Besides a few days in May at the DC Summit Series and trying to write articles and posts when I can, I’ve been very focused on two things professionally–iContact and Nourish International. I’m the Board Chair this year for Nourish so I was part of a committee to select Nourish’s next Executive Director Ryan Richards, who started on the job last week here in Chapel Hill.

Ryan comes to Nourish from NYU’s Wagner School and has worked with ReadingVillage, StartingBloc, Ashoka, and Asturias Academy previously. Ryan is taking the role from James Dillard, who as ED grew the organization from 8 to 22 college chapters.

Nourish is focused on training US college students to become global citizens. Nourish teaches entrepreneurial skills to college students who then run small businesses and ventures on their campuses, make a profit, and then invest those profits in community-based organizations in the developing world (thirteen countries so far including in  India, Bolivia, Mexico, and Uganda) who work to implement community-led sustainable economic development projects.

Nourish’s Board of Directors now includes…

• Pallavi Garg, UT- Austin
• Jud Bowman, CEO of PocketGear
• Neil Bagchi, Bagchi Law
• Buck Goldstein, UNC Entrepreneur-in-Residence
• Jim Kitchen, TUI Travel
• Lee Buck, LaunchBox Digital
• Joel Thomas, UNC-Kenan Flagler
• Chris Bingham, RileyLife Industries
• Marcia Angle, Intrahealth
• Ryan Allis, iContact
• Ryan Richards, Executive Director

If you’d like to learn more about Nourish International, make a financial contribution, or get involved you can visit the Nourish web site or contact Exec. Director Ryan Richards at ryan[at]nourishinternational.org.

Life Update

The past few months I’ve been living in Chapel Hill and traveling a lot for work to wonderful places like San Francisco, Boston, Chicago, D.C., and New York. Our ‘house of entrepreneurs and social entrepreneurs’ has grown. We have welcomed Zach and Ryan to our house recently and are up to 6 roommates (Phil, Ryan, Ryan, Joe, Zach, Andy) with Riley the Dog running around. Somehow we keep a good system going.

I’ve not had time to host an Entrepreneur & Social Entrepreneur Meetup for a few months but hope to bring them back in the Fall. I’m hoping to be able to head to Kampala to visit Roey with VillageEnergy in October as well as see Kigali and Zanzibar for the first time.

My girlfriend Jess has graduated from UNC with a degree in Peace, War, and Defense and is now working on both finding a job in the socially responsible investing or international relations field as well as writing a business plan for a new venture called Borderless Books and volunteering for Jim Thomas’ AfricaRising.

If you know of anyone looking for a brilliant UNC grad and social entrepreneur who’s worked in Tanzania, Guatemala, and Uganda to work for their non-profit organization or company, email Jess at jess.shorland[at]gmail.com!

My parents Pauline and Park moved back to Bradenton, Florida in December. They have now sold their house in Carrboro, NC and this weekend will be the big family furniture move to my house.

Off to do a reference check call…

Ryan

iContact's Social Responsibility 

In May, Matt Kopac has joined iContact as a 20 hour per week consultant, helping iContact on our social and environmental responsibility work. Matt will help iContact become a B Corporation (for-benefit corporation), create a system to quantify our social and environmental impact, and prepare for writing our 2010 Corporate Social Responsibility (CSR) Report for the Board of Directors. Matt is comes to us from Yale University where he finished in MBA in 2009. Matt has worked in the Peace Corps in Benin and for VisionSpring in El Salvidor. He works in a cube outside Cindy Hays' office. Say hi to Matt (picture below) when you see him! 

What Does a Triple Bottom Line (TBL) Mean? 

A triple bottom line company is a company that focuses on its financial results, social results, and environmental results. This three-pronged measurement system also goes by the moniker of "Profit, People, Planet." We already measure and report on our financial results religiously. Part of the work Matt will be doing is setting up a system to measure our social results and our environmental results. My hope is that iContact can become a global example of a socially responsible triple-bottom line venture-backed technology company. My strong belief is that by measuring and focusing on social impact and environmental impact, financial results are actually improved and not the other way around. We are just at the beginning of this process.

To the Dominican Republic I Go

Weddings have been missed. Births have been missed. Babies have been conceived that otherwise would not have been. Lifelong friendships have formed. Serendipitous first romantic connections have blossomed in Hyde Park. Lovers have connected via Skype and Gmail video chat.

Yes, there will be a movie. And no, I still do not know how to pronounce that darn volcano’s name. No one does.

UK Airspace Closed Since Thursday

It’s 5pm GMT on Tuesday 20th of April 2010. I’m writing on a Eurostar train from London to Paris that will soon go under the ocean. I’m trying to get back to work at iContact in Durham, NC and to a loving girlfriend Jess in Chapel Hill.

UK airspace has been closed since Thursday mid-day. My flight home on Sunday was canceled. I had been stuck in London for three days, prior to deciding to stop waiting and head south.

A Plan to Escape

By Monday at noon I had a plan. I had booked a Hertz rental car at London Heathrow and would pick up Nathaniel Whittemore of Change.org and two other friends from the Skoll World Forum who were stranded here and drive down for a Friday flight in Madrid. The rental was expensive, but it was something that felt both adventurous and productive, two words that are too rarely aligned.

But then, in the hotel lobby the news came on saying the UK airspace would open. The newsflash scroller said airspace would open at 1800 hours. The lobby erupted with cheers.

My new 42 year old friend, fellow American business-traveler gone-astray Chris, and I jumped in a cab across the street to Heathrow Terminal 3 thinking we might as well go jump in line. He had been stuck since Thursday was trying somehow, someway to meet up with his wife, 9 year old son, and 7 year old daughter who left Boston today for his annual family vacation.

By the time we got back to the hotel with hopes dashed the newsflash scroller had corrected itself, by adding the word ‘tomorrow.’ But alas, there was hope for an opened Heathrow.

So I canceled the rental car and took take my chances staying put. I didn’t really want to learn how to drive on the left side of the road in the UK, anyway. Or for that matter, learn how to drive on the right side of the road in France and Spain with a right-sided steering wheel, regardless of the amount of liability insurance. Back to Plan C it was.

Excitement Until the Fiery Volcano Recast its Ash

After a serendipitous dinner with a new friend and Skoll delegate Darlene from Ikatu, who is setting up for-profit socially responsible businesses in Ghana to scalably employ disadvantaged youth after eighteen years at QVC, I prepared for bed excited at the possibility of going home.

Last night at midnight. I had a confirmed seat on a flight from Heathrow direct to Raleigh leaving tonight (Tuesday) at 8pm and had received the cherished official American Airlines text message telling me so. All was looking promising.

I forwent the mini-van to Madrid option that an entrepreneurial Skoll delegate had arranged to depart from our hotel at 5am and the Skoll Foundation canceled their rented coach service to Madrid intended to rescue their foundation members and stranded guests. All was looking rosy, and most went to bed happy.

But then, around 1am news spread on Twitter via the creatively coined #ashtag hastag that the volcano had started erupting again. By the 3am NATS update suddenly instead of preparing opening up Tuesday the situation was “dynamic and variable” which seemed to be governmental double-speak for “you’re probably screwed.”

And so the volcano started erupting again in the middle of the night, keeping London shut down for the sixth straight day.

Send in the Navy

British airspace, closed since Thursday, did open for a brief respite this morning in the North of the United Kingdom where a few lucky passengers slipped out. Plenty of planes coming from mainland Europe were flying overhead today as UK airspace was open for planes that flew above 20,000 feet. Unfortunately NATS did not allow planes on the ground to take off.

While the British government had sent in the HMS Albion to rescue stranded British tourists, partly due to political pressure stemming from an upcoming election that remains a toss up, they didn’t seem to be able to do much to get folks out of the UK.

The Queen Mary 2 cruise ship back to New York was fully booked up, the trains were full, the ferries were full, and the French train workers were on strike. Wonderful.

And thus I woke up, for the third morning in a row in a hotel adjoining Heathrow, anxiously awaiting news from the London Volcanic Ash Advisory Service (yes, really) and NATS as to whether they would allow London airports to open.

By noon the answer was a clear no.

Decision Time

After receiving the dreaded flight canceled text message, it was decision time.

And so, rather than waiting for an indefinite period of time, at least until Thursday, for a flight from Heathrow, here I am on a Eurostar train to Paris (the coach seats were all taken so here I am in first class anything for the first time in my life and hopefully the last).

Tomorrow, I have a flight booked to the Dominican Republic and then on to Miami Wednesday night and to RDU Thursday. Today, Paris is open. Tomorrow, we shall see. C’est la vie.

If Paris does not work out, then there is always a bus to Madrid. I have a backup refundable flight booked Friday from Madrid direct to Miami. It may prove difficult to get to Madrid from Paris with the French train workers on strike, but I’ll find a way.

I’m currently working on Plan F, hoping it sticks. I don’t think I’ve ever had a Plan F before, for anything.

Plan A: London to Raleigh by plane leaving Sunday

Plan B: London to Raleigh by plane leaving Monday

Plan C: London to Raleigh by plane leaving Tuesday

Plan D: London to Madrid (in rental car) to Raleigh (by plane) via Ecuador and New York, leaving Thursday

Plan E: London to Madrid (in mini-van) to Raleigh (by plane) via Miami, leaving Friday

Plan F: London to Paris (on the Eurostar train) to Raleigh (by plane) via Dominican Republic and Miami, leaving Wednesday

Plan G: London to Paris (on the Eurostar train) to Madrid (by bus) to Raleigh (by plane), via Miami, leaving Friday

Who would have thought going to Punta Cana in the Dominican Republic via Paris would ever be the best option home to NC from London?!

I am sharing a Holiday Inn room tonight by Paris Charles de Gaulle airport with my new friend and fellow traveler from Boston, Chris, who is trying his best to get back to his family as soon as he can.

I’m enjoying the adventure and getting lots of work done.

Who We Should Not Forget As We Tell This Story

As the stories of the inconvenienced well-off are told, we musn’t forget those who are truly suffering tonight.

People like me, business travelers with an EA, who can afford hotels, are doing just fine and can relax and enjoy. I am not in the majority, however. Most here are tourists and families who are stuck and cannot easily afford the $2000 or $3000 extra cost per person to get home per person in any reasonable time frame.

I particularly have sympathy in this uniquely ambiguous situation for those who have truly been hurt financially or otherwise by this situation.

From the family sleeping in the Heathrow arrivals section, waiting now six days for their connecting flight, who cannot afford the jacked-up hotel rates (what was once 29 pounds is now 79, what was once 139 pounds is now 200) to the Kenyan farmer who now has nothing but wilted flowers or a rotten crop that must be tossed or turned into cow-feed, families have been economically devastated due to the decision to close the airspace, some say unnecessarily.

There is a tremendous economic story here, and tremendous economic pressure to open up the air.

Further, I hope that the attention this volcanic incident is getting, with  primarily middle-class and weathly Westerners “stranded” in nice hotels and having an extended European vacation (even if it is an expensive and unplanned one), will not detract from the ongoing much greater crisis in Haiti where there are 750,000 real human refugees who still to this day, 100 days on, are lacking shelter, clean water, and medical care.

As this story unfolds, I hope the global media does not lose touch with the much greater human story happening to folks who may not have as much resources. In our story, we should at least arc back to the other major natural activities of 2010 in this watershed year for strange natural behavior.

When You’re Stuck in a Trap Eat Cheese

The best line of the week was from Peter Greenberg at CBS speaking at TEDxVolcano, “When your stuck in a trap, eat the cheese.”

‘Tis the adventure of globalized commerce disrupted by a fiery Mother Nature.

So here I am in France. The train is now temporarily stuck due to a “problem on the tracks.” Perhaps some brie is called for.

UPDATE 12:53am: I made it to the hotel in Paris by the airport. UK airspace opened as of 9:34pm GMT Tuesday. The flight from Paris to the Dominican Republic is looking good for tomorrow. After waiting in line to see if we could get on an earlier flight and the only option being an outrageous $8000 business class ticket to Miami in the morning. We’re getting up at 6:30am to attempt to fly standby on anything to the U.S.

Recap: TEDxVolcano

I’m at The Hub incubator space next to London Kings Cross station this evening. I’m attending a spontaneous entrepreneurial event called TEDxVolcano that has been set up in 24 hours by Nathaniel Whittemore of AssetMap and Change.org with the support of TED, TEDxLondon, Sandbox Network and many others. The wonderful MC was June Cohen of TED Media.

Video of the event is now up at http://ow.ly/1zZOE.

The amazing line up of TEDxVolcano speakers were:

• Larry Brilliant, Skoll Foundation
• Rita King, Dancing Ink
• Chris Fralic, First Round Capital
• Jim Fruchterman, BenetechJim Burke, Participant Media
• Cara Mertes, SunDance Festival
• Sally Osborn, Skoll Foundation
• Matthew Bishop, The Economist, Author of Philanthrocapitalism
• Jim Hornthal, CMEA Capital
• Gary Bolls, Social Capital Markets (SOCAP) Conference
• Peter Greenberg, Travel Correspondent CBS
• Elizabeth Lindsey, Mapping the Human Story
• Jeff Skoll, The Skoll Foundation

Videos shown:

• A Small Act
• Pixels

There were also three wonderful musical performances by Sushella Raman.

Here are some funny or especially noteworthy quotes:

“Money doesn’t really matter when you’re stuck by a volcano. You could have a private jet, but that just means you’d get to die alone.” – Cara Mertes

“This is the generation that has to decide whether we will actually have a civilization” – Cara Mertes, Sundance

“The name of the volcano Eyjafjallajokull in the local Icelandic dialect actually means Goldman Sachs.” Matt Bishop, Philanthrocapitalism

“It is difficult to have an intelligent debate today on many critical issues like capitalism and on climate change without people immediately taking sides.” – Matt Bishop, Philanthrocapitalism

“Thank you to the British allowing us colonials to stay here for an indefinite period of time.” – Jim Hornthal

“How many people are stranded. You’re screwed. So, what’s the best thing to do when you’re caught in a trap. Eat the cheese!” – Peter Greenberg, CBS Travel Correspondent

“Today in Kenya, 400 tonnes of flour (or flowers?) in Kenya was thrown out because it is rotting. Think about the economic impact.” – Peter Greenberg, CBS Travel Correspondent

“For every day we’re not flying and air cargo is not flying documents aren’t being delivered, produce is not being delivered, medicine and organs aren’t being delivered.” – Peter Greenberg, CBS Travel Correspondent

“Even in the best of times, airlines lie. If they were running the shipping business they would have listed the Titanic as on time.” – Peter Greenberg, CBS Travel Correspondent

“We all have watches, but we have no time.” – Elizabeth Lindsey

“Perhaps this time is essential for you to consider, are you going to upgrade your impact” – Elizabeth Lindsey

“We wanted to keep our friends here after Skoll. Do you know hard it is to fake a volcano. Damn the volcano, let’s have a ball.” – Jeff Skoll, Skoll Foundation

Here was the TED Blog post on the event.

Volcano Causing Entrepreneurs to Be, Well, Entrepreneurial

I’m stuck in London for a few days due to the Eyjafjallajokull volcano eruption in Iceland.

I’m looking outside my hotel window at a calm Heathrow airport. It’s filled with parked planes, but nothing and no one is moving. All of the UK and much of European airspace is closed.

Here’s a concerning part–the last time the Eyjafjallajokull volcano erupted in 1821 the eruption lasted for two years. Oh my! This volcano could affect European air travel for quite some time. The International Air Transport Association (IATA) has said airlines are losing about £130m per day in revenues.

Fortunately the forecast is calling for a storm toward the end of this week that should make it safe to fly again, at least for a time.

I’ve looked into taking the 7 day Southampton to New York cruise home (people are actually considering this!) or getting a ferry to Bilbao, Spain and then a train to Lisbon, which is currently open for most flights, but it would take at least three days to even get to Lisbon from London at the moment as the ferry services are mostly booked up.

So I’m going to get comfortable and get some work done. It looks like iContact’s European headquarters will be opening tomorrow .

In the meantime I’m attending TEDxVolcano tonight in London which looks fun! A few hundred entrepreneurial attendees of the Skoll World Forum on Social Entrepreneurship and OxfordJam remain stranded as volcano refugees–so Nathaniel Whittemore has in 24 hours organized this event to bring us back together in true entrepreneurial fashion.

Also entrepreneurial is a ‘rescue mission’ set up by a local TV host here who is taking Britons stranded in France back to the UK by boat.

Some here are suggesting the UK, French, and US militaries need to get some transatlantic boat services running to get people stranded on both sides of the oceans home and back to work and their families. A lot of people here would take a guaranteed 7 day return at this point.

Anyone have any creative ideas on how to get back to North Carolina?

Social Good With Market Returns at Skoll World Forum on Social Entrepreneurship

Why I’m At Skoll…

I’m in Oxford, England today for the first full day of the Skoll World Forum on Social Entrepreneurship. I’m making great connections with investors who care about social impact equally to financial returns and learning how iContact can be a more socially responsible enterprise.

Our vision for iContact is to “Build a great global company based in North Carolina for our customers, employees, and community.”

So I’m here to ‘go to school’ for three days on how to truly maximize return for customers, employees, and community so that we can in turn maximize financial results for our shareholders. Fiduciary duty can go along with human social duty!

To me, having a formal CSR program and caring about impact for the customers, employees, and community is just good business sense that in fact maximizes financial return.

Increasing Financial Results By Focusing On Social & Environmental Impact

Personally, I strongly believe, in today’s new world, ensuring your business provides a positive social and environmental impact (or at least not a negative one!) will increase your financial return, not decrease it. I’ve seen this happen with numerous for-profit socially responsible companies like Ben & Jerry’s, The Body Shop, Whole Foods, Burt’s Bees, and Salesforce.com.

How can focusing on social impact improve financial results?

How can focusing on social return improve financial results? In three simple ways.

1. The type of employees who want to work at companies that care–companies that put equal emphasis on profits and purpose–are the most productive and often most aware and intelligent team members.
2. There is a growing movement toward consumers who care. Consumers will have much more brand loyalty to a company that they know cares and makes a positive social impact.
3. When customers become passionate about a brand they talk about it more and more people will write about it.

The Tipping Point

After 30 years of so many in the social enterprise field working towards this, the tipping point has been passed wonderfully and thankfully. As the Dean of the Oxford Said Business School Colin Mayer said last night, the financial crisis has shown that short-term focus on only financial results does not lead to long term success.

Organizations like B-Labs have succeeded in changing public policy toward the benefit of companies who care. Self-interested (”greedy”) business owners who want to make money will now wonderfully benefit financially from implementing a formalized Corporate Social Responsibility program and ensuring they track and social impact and environmental impact.

The invisible hand is now starting to work toward social good with economic growth now that incentives are being realigned properly toward sustainable economic growth. While there is much more path to tread toward truly aligning policy incentives and consumer purchasing behavior toward companies who care–it is happening and the tipping point has passed! Eureka!!

Social Good With Market Returns?

Right now a panel called ‘Social Good With Market Returns’ is about to begin. I’ve been tweeting a lot about the conference via @ryanallis.

The moderator is Herta von Stiegel of Ariya Capital.

The speakers are:

Nick O’Donohoe, Global Head of Research JP Morgan
David Chen, Principle, Equilibrium Capital Group [video]
John McCall MacBain, Founder and Director, McCall MacBain Foundation

Nick from JP Morgan is talking about the Social Finance group at JP Morgan. Nick is not a “normal banker.” They invest in social enterprises that have a double-bottom line (financial and social). This social investing field is also being called “Impact Investing.”

Ensuring Off-Balance Sheet Externalities Are Positive

There is a engaging discussion going on now at the panel around off-balance sheet externalities (positive and negative) of impact (positive or negative). Nick says “every time we make an investment we are creating externalities.” He says these externalities can be positive (jobs) or negative (pollution). He says “for the first time the investment community is measuring the social impact of what they are doing and only investing in companies that create net positive externalities.”

This discussion is at the core of global history of the past 200 years as the ideological battle between communism, socialism, and capitalism has been waged. The new consensus that is emerging here is that what has won (and in fact what must win for the sake of humanity’s ability to continue) is socially responsible capitalism. As John Perkins points out in Hoodwinked, there is nothing inherent in the model of Capitalism and the competitive market economy that require off-balance sheet externalities that destroy the world.

Taking Into Account the Full Cost of Environmental Damage

Now the discussion is revolving around how to adjust public policy to enable the true cost of negative externalities to be accounted for in the financial accounting results. Some are saying the Holy Grail for improving the world through business is to make all investing ‘impact investing’ by taking into account the true cost of environmental resources that are not renewed into Generally Accepted Accounting Principles (GAAP).

“Better accounting for negative externalities is really important” said John McCall MacBain of the McCall MacBain foundation just now on the panel. The discussion is revolving around environmental costs being forced on any organization that destroys a natural resource (public good) that does not replace it sustainably and the impact this would make on ensuring warped incentives are not provided to global financially-focused Boards of Directors.

The discussion has shifted to bringing the silos of philanthropy, impact investing, running non-profits and socially responsible for-profit entrepreneurship.

Borrowing a meme from my friend Judith Cone who worked at the Kauffman Foundation and now works at UNC as a Special Assistant to the Chancellor for Innovation and Entrepreneurship, perhaps it is all about where goodness lies. Goodness can be in the heart of the public sector official, for-profit socially responsible entrepreneur, non-profit executive, global multinational Board member, activist, or investor.

Nick O’Donohoe from JPMorgan is speaking about how JP Morgan can access capital high net worth individuals and institutions they work with which want to tap into investment funds specifically set up for investing in companies who put an equal emphasis on social impact as financial results.

Questions & Comments?

What questions are there on this topic of public policy changes and investing in companies that create social good while achieving market returns or above market returns? I’d love to discuss this more!

You can follow tweets from the Forum here.

Microequity at Skoll World Forum on Social Entrepreneurship

What Comes After Microloans?

As a technology entrepreneur and angel investor in both North Carolina and East Africa, I’ve been thinking about what comes next in microfinance? To me, it’s microequity.

I had a fascinating breakfast this morning here in Oxford on the topic of microequity. The field of microequity is nascent, but rapidly growing. To me microequity is investing small amounts in for-profit socially responsible companies, particularly those in the developing world. I’d consider the core of microequity investment ranges are between $5k and $100k in for-profit socially responsible companies in the developing world.

Microequity investing can fill a tremendous need for capital for SMEs that can help a small business grow when microloan maximums have been reached but an entrepreneur is not yet able to access banks and larger scale institutional investors.

Effectively, microequity can be seen as seed funding and angel funding for companies in the developing world–with the exception that investing $25,000 in an existing company in the developing world really is growth capital rather than seed capital as this amount of capital can go much further and in some cases get a company past cash flow positive.

A Model for Microequity

From my vantage there seems to be a profitable (and hence scalable for greatest social impact) model that is now being developed investing in these microequity capital ranges in many parts of the world and filling the gap that sometimes exists between microloans, banks, non-profit investing funds, and institutional capital while creating tremendous social impact through sustainable job creation and economic development.

Overhead costs, deal selection, accounting transparency, and methods of obtaining the return are perhaps the most challenging obstacles to achieving a market rate of return to the investment. We talked about how all of these challenges can be overcome. There is such a huge gap here that traditional finance has not yet solved and there so many high quality opportunities to invest in while making a tremendous impact.

One suggestion centered around taking a pre-agreed upon percentage of free cash flow (FCF, or effectively net profits) that is pre-agreed upon in advance. Another suggested revolved around tying returns to a revenue multiple since EBITDAs are easier to manipulate by non-audited smaller companies.

Personally, my interest is in helping small, high potential companies based in the developing world owned primarily by local entrepreneurs access the mentorship and financial resources they need to grow into the future leading companies in their respective countries and eventually take their firms public on regional stock exchanges when run. It will likely take a couple decades to bring together the educational (human capital), governmental, and infrastructural resources needed to help small companies run by smart ambitious local entrepreneurs thrive–but the trend toward local entrepreneurial-led (often ICT-related) economic growth is already happening in Kampala, Kigali, Dar es Salaam, and Nairobi and so many other emerging markets globally from what I’ve seen.

To me, small business growth is the key to sustainably growing an economy and effectively increasing per capita incomes (otherwise known as reducing the number of people in urban and rural areas in poverty) and I believe through the right local trust networks for deal flow and local entrepreneurial support and mentorship models it is quite possible to achieve very strong returns investing today in high-potential for-profit socially responsible companies in the developing world.

Not Replacing NGOs, Non-Profits, and Public Sector

Investing in for-profit socially responsible companies in the developing world does not replace the need for a strong effective transparent public sector and does not replace the need for investments from non-profit organizations and NGOs.

Rather, it is additive to creating sustainable bottom-up economic development that creates local constituent-based growth in a way that reduces inequality of opportunity–and it happens to be where I think I can add value with my background as a venture-backed technology entrepreneur at some point.

Creating a venture capital fund that puts social return equal to financial return is something I hope to focus on someday down the road and create a scalable model that provides market-rate returns (15-20% per annum) investing in high-growth entrepreneurial ventures in the developing world run by local entrepreneurs (likely in the energy, solar, water, agricultural, low-cost medical device, software, and Internet fields).

Microequity Breakfast This Morning at Skoll

The microequity breakfast attendees this morning were:

Forrest Metz, Dev Equity, based in Oxford
Ryan Allis, iContact, based in North Carolina USA
Allan Barkat, Dualis, based in Israel
Naoko Felder-Kuzu, Socential, based in Zurich
Ron Boehm, Boehm Gladen Foundation, based in California, USA
Rob Pettit, Sumaria, based in Dar es Salaam, Tanzania

We chatted about a number of social venture funds investing in equity in the developing world such as GrowFin, BusinessPartners, TBL Mirror Fund, InReturn, ManoCap, and Jicana.

We had a great discussion around the technical structure around how to achieve market-based returns investing in for-profit socially responsible companies in the developing world.

We also talked about networks of socially responsible investors including Social Venture Network, Aspen Network for Development Entrepreneurs, and the Global Impact Investing Network and marketplaces for entrepreneurs in the developing world raising capital like BidNetwork and NeXii.

Questions & Comments?

What questions are there on this topic of microequity and investing in companies that create social good while achieving market returns or above market returns? I’d love to discuss this more!

Blake Says: Go Barefoot to School & Work on April 8

I met Blake from Tom’s Shoes at Summit Series in April 2008. He asked me to post this.

Coming up April 8th is our One Day Without Shoes campaign and we are really blowing it out this year.  Actually shooting for 500,000 people to go barefoot and we built this special site www.OneDayWithoutShoes.com where people can sign up to host barefoot walks, post videos, etc.
 
Carpe Diem,
Blake Mycoskie
Tom’s Shoes

Tech Awards: $50K for Using Technology to Address Humanity’s Challenges

Tiffany Yee from Santa Clara University reached out tonight to ask me to share information about the upcoming Tech Awards which is offering five winners $50k each to scale their innovation solving a major human challenge.

The Tech Awards, a signature program of The Tech Museum, honors innovators from around the world who are applying technology to address humanity’s most urgent challenges.

In partnership with Santa Clara University’s Center for Science, Technology, and Society, 15 Laureates are selected annually and $50,000 is awarded to one Laureate in each category: Environment, Economic Development, Education, Equality, and Health.

Individuals as well as nonprofit and commercial organizations are eligible. Anyone may submit a nomination. Self-nominations are accepted and encouraged.

Deadline for nominations is March 31.
Deadline for final applications is May 5.

This year’s Laureates will be honored during a week of activities in Silicon Valley leading up to The Tech Awards Tenth Annual Gala on Saturday, November 6, 2010.

You can nominate today at www.techawards.org

Past winners can be found at http://www.techawards.org/laureates/

Bull City Forward: Looking for Socially Responsible Tenants in Durham

Bull City Forward is opening up a coworking/incubator space in downtown Durham on March 1st for socially responsible companies and non-profits. They are providing subsidized office space and services that include:

• Central Internet, fax, copying, phones, mailing address, meeting rooms
• Workshops on fundraising, legal structures
• Networking events, speakers and a community of change makers
• Space for members to host their own events

They will be in the Greenfire building at the Kress Building at the corner of Mangum St. and Main St. at 101 West Main in the heart of Durham.

For information on becoming a tenant you can contact Alison Dorsey at alison.noel.dorsey[at]gmail.com.

The Durham Herald-Sun did an article on their vision in January.

It’s truly wonderful what is happening in Durham. This city has been transformed in the past five years and the pace of positive change is accelerating!

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