Review of The Dream by Gurbaksh Chahal

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I’m sitting in the corner of the Starbucks at the Southpoint Barnes and Noble in Durham. I’m reading The Dream by Gurbaksh Chalal (nickname ‘G’), a 26 year old internet entrepreneur from India and San Jose, California. G has a compelling writing style in the beginning, writing of the difficulties he encountered growing up as an Sikh Indian-immigrant. Here are my notes from the book.

G dropped out of high school at age 16 to start a performance-based advertising network called Value Click.

Growing Up a Sikh Immigrant Indian in San Jose

Some of the stories in the first part of the book that initially struck me were:

• His father and him day trading on margin in 1997 and doing equity research together. In October 1997 (right before the Asian Market Crisis) the market had a small dip and in fear of the market falling further and not being able to cover his margin sold at the very bottom, which caused his father shame and nearly to lose their new house.
• G being forced to remove his turban at knifepoint when playing basketball in the ‘hood’ of San Jose.
• G taking a public speaking class in high school and having to give a speech as a very traditional Sikh about the randomly assigned topic of Viagra.

Here’s how G. got started…

• Buying the HP.net and Dell.net domain names in 1997 and sending a letter to the companies offering to sell the names back to them for $10,000–and then receiving threatening cease and desist letters and giving the domains back for free.
• Starting to sell printers on eBay, then starting a performance-based advertising network Click Agents
• Setting us his very first deal in a very ‘Elliot Bisnow’ type of way–by getting one ad agency to commit one $30k insertion order (IO) at $1 CPC and only after having it, building his ‘consortium’ of web sites to traffic the ad at a 50/50 rev share, all along using the fake name Gary Singh.

Results Matter

An excerpt from p. 59:

“All the knew was that Gary Singh delivered, and that’s all they cared about. They had no idea they were dealing with a sixteen-year-old kid because I presented myself as a serious professional. Once again, perception is realty. That’s not a kid on the other end of the line. It’s a guy who delivered on his promises.”

On page 80, G tells a story I can relate to, his servers went down for a week due to a vengeful vendor. His story reminds me of the week in December 2003 our server went down due to hardware failure. An excerpt:

“We were offline for an entire week… A week without the Web. Well that was the lifeblood of my business, and that week almost put us under… Time in the Internet is measured in dog years .For that entire week, Click Agents had ceased to exist.”

Ideas Vs. Execution

Gurbaksh makes a good point about the value of ideas vs. execution on p. 100.

“If you have an idea for a company, that’s just the beginning–that’s your entry point. What really matters is execution. Don’t think about the millions you’re going to make, think instead about creating a company that will be worth millions… The difference is huge. Success is laregely about substance. If your company is about real, tangible assets, and you’re looking the the long term, you are going to be handsomely rewarded for it.”

Struggling With Bureaucracy at ValueClick

On page 117, G laments in an amusing paragraph, working for the slower, bigger, public ValueClick. VCLK had bought Click Agents in November 2000 for $40 million.

He notes, “…in this new environment, I couldn’t move forward without official approval. I had to sell an idea to one guy, then to a second guy, and then to two or three more guys after that, and they all seemed incapable of making a decision. I guess that’s what people mean when they talking about the bureaucracy. It’s a place where absolutely nothing gets done. And the larger the organization, the less one is able to accomplish…I couldn’t understand how corporations actually accomplished anything, since the bureaucracy seemed to be designed solely to steer you into one brick wall after another.”

Getting over The Fake Excitement of Materialism

Around page 136, G. begins to talk of all the Ferraris and Lambourghinis he purchased after selling his ValueClick shares. I was disappointed by the materialistic focus of this part of the book, but I could understand it in my own imperfection. I owned a 350z for two years when I was 21 to 23 before I sold it due to what it was doing to my personality.

On p 139, G writes, “I was breaking one of my own business rules. Need versus necessity. Did I really need that king of luxury.? No. Then again, maybe I’d earned it. So I Lived with it. After all, as they say, all work and no play makes G a dull boy.”

G was close to coming to the conclusion that the two luxurious $240,000 Lambourghini’s he bought was a little over the top but didn’t quite get there. I was disappointed in him at that point.

One of G’s ‘lessons’ later in the book that he shares is “Forget noble motivations.” On this, more than anything else, I disagreed with G.

Blue Lithium

After his three year non-compete agreement with ValueClick was up and after G sued ValueClick for securities fraud, he started BlueLithium in 2004 at the age of 22. He raised $11.5 million from 3i and Walden VC when the company was doing $200,000 per month in sales in February 2005. I’m not sure what G was thinking, but as part of this deal he agreed to a 5 person board, of which 3 were selected by the investors.

In my view, it is not in an entrepreneur’s best interest to let investors pick a majority of the board (and thus effectively control the entire company for a minority investment). It seems like G did not have a choice based on the amount of money raised and the stage but I would have thought he would have had more ability to set terms in the round having had a nice success previously. On p 186, G describes the difficulty he experienced with his Board believing in him when ValueClick sued BlueLithium claiming he had stolen trade secrets.

In the end, BlueLithium did well with its behavioral targeting ad technology that was able to show relevent ads to consumers based on their internet browsing history. They sold the company to Yahoo on September 4, 2007 for $300M when they were about the same size iContact is today. They had good timing and in retrospect sold at a good time, following the DoubleClick/Google, aQuantive/Microsoft, and 24/7 Real Media/WPP Group transactions.

The Secret Millionaire

In Chapter 6, G describes how he ended up being part of the current Fox show The Secret Millionaire. The premise of the show is that an American millionaire (in this case, G) lives in a distressed community for one week and talks to people and then decides at the end of the week how to allocate $100,000 to non-profit organizations in the area.

As an aside, relevant to the premise of The Secret Millioniare, last night at Crunkleton’s (bar in Chapel Hill), I had an in-depth passionate debate with my friend Jess last night about Easterly’s The White Man’s Burden and whether any benefactor or philanthropist, including myself, can legitimately and morally go into a distressed community for just one week and then appropriately contribute funds without knowing fully how they will be used and whether the impact will in fact be positive or sustainable.

I made the point to Jess (who spent 2 months in Uganda at the Sachs’ Millennium Village Project in Ruhiira last summer) that I had visited Uganda in July to see the impact of the small funds I’d already contributed and to see with my own eyes how the funds were being used and whether the organizations could efficiently and and positively utilize more in the future. I argued that some BHNs like education, healthcare, and clean water were simply fundamental to humanity and that the core issue with aid that Easterly described were mainly caused by bi-lateral government to government aid that was not reaching the people. Instead, providing aid directly to grassroots organizations run by locals in which you could see the impact yourself was qualitatively a better method. The show has gotten some criticism here and here and of course on ValleyWag multiple times, but I’ll hold my view until I can catch an episode.

G’s Entrepreneurship Lessons

Finally, G ends the book with 27 lessons on entrepreneurship. They are:

1. Listen to your heart.
2. Forget noble motivations (one I disagree with)
3. Adjust your attitude
4. Figure out what you’re good at
5. Trust your gut
6. Do your homework
7. Be frugal
8. But don’t be frugal with hiring
9. Hire smart people
10. Don’t expect perfection, but strive for it
11. Learn to listen
12. Own your mistakes
13. Never compromise your morality
14. Never lose sign of the competition
15. Watch your back
16. Don’t procastinate
17. Don’t do anything by half-measures
18. Be nice to people
19. Negotiate from a position of strength
20. Expect the unexpected
21. Perception is reality
22. Don’t get emotional
23. Be fearless
24. Pick your battles
25. Grow a think skin
26. Take chances
27. When you commit, you really have to commit.

Overall, I would recommend the book as for me it was good to understand the process of professional and personal development of a similarly aged internet entrepreneur. It did not provide much how-to and was more biographical in nature.

I’m sure I’ll meet Gurbaksh soon enough at one of Elliot Bisnow’s get-togethers for young technology entrepreneurs sooner or later, and I look forward to the day. I could relate to much of the bananas G went through including being bullied when young for being different, sacrificing other opportunities to build a business, raising venture capital at 21, and finding flow every day by being immersed in a company.

The Revolution Will Be Tweeted – Saturday May Bring Change to Iran

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As we sleep tonight in America, there is history afoot. Never before has the social web been used to such an extent within a country to attempt to remove a leader and coordinate a political revolution. Tomorrow, Saturday, will be an important day in the history of Iran.

For the sake of this post and citizen journalistic integrity, I’ll try to be as objective as I can here as few of us outside of Iran can know enough to truly know what is accurate. This noted, the consensus of the digerati has been made known and it is clear. In the world of Twitter, Facebook, Flickr, and YouTube–the crowdsourced view is behind the ‘Green Uprising.’

A tipping point may be reached after today’s day of prayer and Ayatollah Khameni’s speech which may only inflame protesters. The momentum behind a movement has begun and it won’t easily taper.

As I browse Twitter tonight, I see tweets like the following:

• ravenclawgirl RT from Iran: Many of my friends calling & say goodbye, as they feel in 2morrow’s demonstration they may get killed #iranelection
• Macagogo A small body of determined spirits fired by an unquenchable faith in their mission can alter the course of history. Gandhi..#Iranelection
• dijitalboy RT @chestkneeshawk: RT BBC adds 3 satellites to overcome signal jamming in Iran. Yay BBC! http://budurl.com/ea4f #Iranelection
• KDSarge All followers of #iranelection think and review before you act or retweet. Iran govt out in full force on Twitter now
• maryamwebster Until we are all heard, none of us are free. Pray for those who are silenced/killed in Iran. Violence isn’t answr. #pray #iranelection #gr88

I am seeing Facebook Statuses tonight like this one:

• Shervin Pishevar – please pray for Iran and the brave Iranian people. In 5 hours we meet our destiny. I will not be able to sleep.

The informative Green Brief is coming out nightly from an Afghan man named NiteOwl, sourced entirely from Tweets from inside Iran. There are instructions on “Anonymous Iran” on how to surf in Iran using proxies so one can access the social web. There is a tremendous set of Flickr photos of the protests on the Fhashemi Flickr account. There are 180 posters from protesters shown at Design for Iran.

In two days, hundreds of thousands of Twitter members have turned their avatar green in support of the Iranian protesters using a tool at HelpIranElection.com.

Here are some videos seemingly showing violent oppression of the protests:

There are so many ethical issues here that we must tread carefully on. We must be careful in the West to so naturally and quickly support this uprising simply because we tend to lean toward the beliefs and views of the more moderate candidate Mousavi. Here is a good article supporting Ahmadinejad’s win. There are folks on the Ahmadinejad/Khameni side who are claiming that the support for the “American led coup in Iran” is causing unneccessary blodshed. Here is an example:

• @JimJones45 – 99% of tweets are from US backing a BLOODY revolution. People are dying. STOP destabilizing the Iranian state! #IranElection

This noted, others on Twitter seem to suggest these twitter accounts, most of which have no history before yesterday, are agents of the Iranian government.

To me, this doesn’t seem to be a Western-led coup. The pictures and videos of the hundreds of thousands of people in the street lay doubt to this claim.

Here is an excerpt of an email posted on Iran Fax Blog the that seemingly comes from an Iranian citizen:

Tomorrow, people will gather again in Valiasr Square for another peaceful march toward the IRIB building which controls all the media and which spreads filthy lies. The day before Yesterday, Ahmadinejad had hold his victory ceremony. Government buses had transported all his supporters from nearby cities. There was full coverage of that ceremony where fruit juice and cake was plenty. A maximum of 100,000 had gathered to hear his speech. These included all the militia and the soldiers and all supporters he could gather by the use of free TV publicity. Today, at least 2 million came only relying on word of mouth while reformists have no newspaper, no radio, no TV. All their internet sites are filtered as well as social networks such as facebook. Text messaging and mobile communication was also cut off during the demonstration. Since yesterday, the Iranian TV was announcing that there is no license for any gathering and riot police will severely punish anybody who may demonstrates. Ahmadinejad called the opposition as a bunch of insignificant dirt who try to make the taste of victory bitter to the nation. He also called the western leaders as a bunch of “filthy homosexuals”. All these disgusting remarks was today answered by that largest demonstration ever. Older people compared the demonstration of today with the Ashura Demonstration of 1979 which marks the downfall of the Shah regime and even said that it outnumbered that event. The militia burnt a house themselves to find the excuse to commit violence. People neutralized their tactic to a large degree by their solidarity, their wisdom and their denial to enage in any violent act. I feel sad for the loss of those young girls and boys. It is said that they also killed 3 students last night in their attack at Tehran University residence halls. I heard that a number of professors of Sharif University and AmirKabir University (Tehran Polytechnic) have resigned. Democracy is a long way ahead. I may not be alive to see that day. With eyes full of tear in these early hours of Tuesday 16th June 2009, I glorify the courage and bravery of those martyrs and I hope that their blood will make every one of us more committed to freedom, to democracy and to human rights. Viva Freedom, Viva Democracy, Viva Iran

On balance, to me the evidence seems to show that a reasonable person could come to the conclusion that this election may have been rigged. To avoid a revolution and further bloodshed, a new fair election must be held.

In an age of instant communication you cannot deceive your population for long. If you throw an election, it will get out. In an age of transparency, the days of leaders who don’t serve their people are numbered.

If you’re on Twitter, you can connect with me via @ryanallis.

The revolution will be Tweeted.

P.S. – Here is an interesting article on how protests were organized before the days of social media.

Can a For-profit Entrepreneur Be a Social Entrepreneur?

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Can a for-profit entrepreneur be a social entrepreneur? Can the Executive Director of a non-profit be an entrepreneur? Yes and yes!

At the Entrepreneur & Social Entrepreneur Meetup on Tuesday I was having a great discussion with a new friend named Phil. Phil asked me a question I’ve heard often recently, “Can I still be a social entrepreneur if I run a for-profit business and not a non-profit?”

In my view, the answer is a resounding yes.

What is an Entrepreneur & What is a Social Entrepreneur?

To me an entrepreneur is “someone who rearranges resources to create value.” To me a social entrepreneur is “someone who rearranges resources to create value.” There is no difference. The line is wonderfully blurry. Let me explain.

An entrepreneur is someone who rearranges the resources of land, labor, capital, and entrepreneurial ability to create a product or service that provides value to others. Whether the entrepreneur is doing this within a for-profit corporation, in which the net profits are either reinvested in the corporation or distributed to the shareholders or a non-profit corporation in which the profits are fully reinvested into the corporation, he or she remains an entrepreneur.

Non-profit founders and directors have customers and products too. Traditionally the customers of a non-profit are its donors and grant makers and the product is the social value it produces. If the product is not valued, customers (donors) will stop giving and leave.

Today, the black and white world of non-profits and for-profits is graying. If you want to change the world for the better, it is an open question as to whether you can make a bigger impact in a for-profit or a not-for-profit company.

Profit’s Correlation With Social Value Provided

As long as the for-profit entrepreneur a) competes within the laws of a competitive market system b) does not create short-term profit for the company by externalizing the costs of the off-balance sheet destruction of the environment and c) does not exploit its labor force, the only way for the entrepreneur to make a profit is by creating value for others.

The more the ethical entrepreneur helps others, the more profit he or she will make. Profit for an ethical entrepreneur who has not exploited the environment or labor force to gain that profit is not an ugly sign of exploitation but rather a laudable sign of value created. The successful and profitable entrepreneur has rearranged resources in such a manner that the value of the output created exceeds the sum value of the inputs.

For the ethical for-profit entrepreneur, as products are produced that help others, social value is created. The very act of building your business creates jobs, provides product and services that others value, and enables you to give back to your local and global community.

Your for-profit business can often be more sustainable than a non-profit business as you are not reliant on grants and donations to grow. While you have a disadvantage of not being able to receive tax-deductible donations, you have the big advantage in the labor market of being able to offer a wonderful thing called stock options to employees, which enables you to attract top talent and enable all to participate in the value-creation.

One of the most important things you can do as a for-profit entrepreneur to enable you to make a social impact is to be profitable. As Joel Makower argues in his book Beyond the Bottom Line, “One
of the most socially responsible things most companies can do is to be profitable.” Without profits one cannot pay taxes, provide jobs that pay well, give back to a community, or invest in innovation.

Five Ways a For-Profit Entrepreneur Can be a Social Entrepreneur

So for a for-profit entrepreneur, if you really want to be a ’social entrepreneur’ here are some suggestions:

1. Give all your employees stock options. Requiring a team member to be there a minimum amount of time (like 6 months) before they earn the options is okay. Vest the options over a few year period (3 or 4) to help with retention.
2. Treat your employees well. Show that you care about them. Offer health insurance and good working conditions. While you have to manage to results and that requires being a professional firm that tracks performance, you can do many little things that create a good work environment and culture that actually help the firm reduce costs, retain great people, and attract a better team.
3. Ensure your net impact on the environment is at least neutral, if not positive. Don’t externalize the cost of environmental damage. In other words, don’t profit off of destroying the environment, even if it may still be legal to do so. Take into account the full cost of any environmental degradation or destruction in the production of your products and services. Look up the supply line and ensure your suppliers also neutralize their impact on the environment. –> Quick Case Study: Last Month, Walmart introduced a Sustainability Product Index that asks each of its suppliers fifteen questions on energy, climate, resource use, and labor practices. It has asked its suppliers to respond by October 2009. It is using this data to understand the practices of its upstream supplier network (of over 100,000 suppliers) and provide a Sustainability Index for each of its suppliers. Walmart is also creating a “consortium of universities that will collaborate with suppliers, retailers, NGOs and government to develop a global database of information on the lifecycle of products – from raw materials to disposal.”
4. Have a formal corporate social responsibility policy. A particular CSR structure I’m fond of is called the 4-1s program, in which you set aside 1% of company profit (or 1% of payroll if you are venture-backed and not yet profitable), 1% of employee time, 1% of product, and 1% of equity to contribute back to your local and global community. –> Quick Case Study: At iContact, we have been contributing 1% of payroll since 2007. In 2008 we contributed $55,000 to 37 different non-profit organizations. In 2009 we’ll reach $100,000. We are now expanding our CSR program based on the 4-1s model to include 1% of employee time (up to 2.5 days of paid time-off per year to be spent on community service products), 1% of product (we are providing iContact free to any non-profit organizations in the Triangle), and 1% of equity. Don’t wait until you’re 60 and wealthy to give back. Start from day one and create an integrated giving model. You can read about iContact’s Corporate Social Responsibility Program here.
5. As you succeed personally, give back. A great differentiator for the for-profit entrepreneur is that you and those working with you can become wealthy through the appreciation of the value of your stock ownership as you scale your ability to help others. If you’re fortunate enough to have a liquidity event (go public or get acquired) use your personal resources to invest in other entrepreneurs and social entrepreneurs who are changing the world for the better, contribute personally to the organizations (and candidates) that you feel are making the biggest positive impact for humanity, and vote with your dollars as a consumer and doing your best to purchase from companies who have a similar view about corporate social and environmental responsibility.

There is a movement of socially responsible companies that is defining our generation. These socially-responsible for-profits, sometimes informally called B Corporations instead of C or S corporations, can make a huge positive impact on the world, up and down supply chains.

There are networks springing up for socially responsible professionals such as the Social Venture Network and Net Impact.

Companies like Vestergaard Frandsen, Salesforce.com, Danone, Stonyfield Farms, and Whole Foods are leading the way in this integrated social business model. They are doing well not in spite of their social mission, but often partially because of it.

There is a new genre of books focused on how to use business to change the world. There are many, but my favorites are The Business of Changing the World, Creating a World Without Poverty: How Social Business Can Transform Our Lives, The Power of Unreasonable People: How Social Entrepreneurs Create Markets That Change the World, and The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits.

There are now publications that focus on the socially responsible business owner, including Stanford Social Innovation Review and Good Magazine (founded by the son of INC. Magazine). There is even a newswire just for social responsible news called CSRWire. There is even a stock index called the KLD400 for socially responsible companies!

There are venture capital firms that now focus on investing in socially responsible companies. These include Good Capital and SJF Ventures.

What Ben & Jerry’s and The Body Shop started is becoming wonderfully mainstream and necessary as a new generation that connects and collaborates globally like none before it becomes corporate leaders.

While I am generally a fiscal moderate who believes in the ideology of individual freedom and liberty, Milton’s Friedman’s 1970 assertion that ‘the business of business is just business’ was wrong. As Peter Drucker argued in 1942 in The Future of Industrial Man, companies must have a social dimension as well as an economic purpose.

Five Ways a Non-Profit Director Can Be An Entrepreneur

As a Non-Profit Director, you are an entrepreneur as well. You have a product and a customer, and you are working to rearrange limited resources to create value.

For the non-profit entrepreneur, today earned income models are becoming the norm rather than the exception. While 501(c)(3) non-profits have a benefit of being able to receive tax deductible contributions, these contributions are often unpredictable and at times can influence a non-profit to go in an undesired direction.

The age of non-profits being able to rely solely on donors and grants is over. For a non-profit entrepreneur, an earned income model exists when the non-profit company sells a product or service to others and gains net income on that sale which is reinvested in growing the non-profit in a sustainable manner. The line between non-profit entrepreneurs and for-profit entrepreneurs is indeed getting gray.

While you are required to reinvest practically all your net income back into the organization, you have a great advantage. As a registered 501(c)(3) you can accept tax-deductible monetary contributions from individuals and corporations. You can apply for and receive grants from foundations. You can also receive in-kind donations from local companies or receive discounts or pro-bono work from service providers.

At the end of the day, just because you cannot distribute net income to your shareholders doesn’t mean you aren’t an entrepreneur. Here are some ways you can be entrepreneurial as a non-profit founder or director:

1. Create an earned-income model. Find a product or service you can sell to others. Just because you have to reinvest your profits, doesn’t mean you can’t make a profit. You don’t have to give away everything. The more value you create, the more you will can earn and the more you’ll be able scale your organization to serve its mission. –> Quick Case Study: As an example, a non-profit I’m the Board Chair of this year, Nourish International, has an earned-income model. Nourish teaches college students to run entrepreneurial ventures on its campuses. These ventures range from ‘Hunger Lunches’ with corn bread and beans to poker tournaments to selling medical scrubs. Nourish then takes the net profit from the students’ ventures and funds a portion of administrative overhead at the national office and contributes to community-based non-profit organizations in the developing world that work to reduce extreme poverty and hunger. This past summer Nourish sent 58 of its students to nine projects in developing countries. Nourish’s model is growing and it now chapters on 29 college campuses.
2. Have an entrepreneurial mindset. Just because you have donors doesn’t mean you don’t have to have a sense of urgency and work quickly and efficiently to produce results and compete. The market for non-profit donations is competitive and contributions will go to those that are well-run and maximize positive human impact with minimum dollars (or at least maximize human impact in the fields that those with resources most care about, a substantive difference). While there seems to be a somewhat unfortunate reality that some well-established non-profits with celebrity representation or large budgets can often get the bulk of available contributions and crowd out perhaps more deserving smaller NPOs, many of these established non-profits were start-ups once as well and only came to be influential by being efficient, achieving their mission, and attracting larger and larger contributions and grants.
3. Hire people who are smart, ambitious and driven. Don’t settle for poor-performers. As a Non-Profit Director you have the ability to attract talented, caring staff members that are willing to work hard for less than market pay. Use this to your advantage. There are driven, smart, ambitious, educated, and talented individuals in the work force that want to work for a non-profit. Too often I have seen non-profit entrepreneurs settling for lower quality team members and not managing their performance. Hire A players who are passionate about what you are driving to achieve and empower them to be entrepreneurial, take risk, and grow the organization.
4. If You Aren’t Maximizing Social Value, Consider Merging. One of the issues in the non-profit world is that it is rather challenging for one non-profit to merge with or be acquired by another non-profit. This creates the reality that there are often dozens if not hundreds of small non-profits inefficiently and disparately going after the same cause. Industry consolidation and M&A in the business world happens naturally as controlling shares can be purchased in private or public markets. For a non-profit this is not possible so it is up to the humility of the founder to consider whether a merger could create a better social outcome. Allowing for the benefit of competition and time it takes to start-up, test your model, and make it scale–consider shutting down or merging your organization with a more efficient or larger organization if you feel like your organization isn’t best using resources to create positive social value. Non-profit mergers can allow the combined entity to share resources, reduce overhead costs, and go after bigger grants while achieving the shared mission.
5. Run your non-profit like a business, because it is. Non-profit organizations sometimes use their non-profit status as an excuse not to seek to be efficient, employ staff performance management systems, or make the tough decisions for-profit businesses have to make to survive and thrive. Being a non-profit does not mean you should not seek to earn profit. It simply means you must reinvest this profit. The more profit your organization can make the faster it can scale and grow and achieve its mission (of course don’t make a profit in a manner that goes against your values and mission!). After all, your non-profit corporation is a business, just one that has committed to reinvest its profits every year back into the business and not distribute them.

What type of organization should I work for to make the greatest positive impact?

Often the best answer to the question “what type of organization should I work for to make the greatest positive impact” is a gray hybrid to the old-school black and white. The answer is often a for-profit business that is socially responsible and integrates the concepts of social business into its organization, or an entrepreneurial non-profit organization that is run like a business, efficiently and with a sense of urgency.

And finally, today the boring and bureaucratic public sector is slowly but surely changing as it is again becoming cool for smart driven people to work in government. The bureaucracy that is Washington D.C. can only change if it is infused with entrepreneurial, efficient management that has a sense of urgency and passionately cares about making a positive difference.

Comments & Thoughts?

I’d love your comments on this post! Particularly if you have any examples of companies that truly integrate social responsibility into what they do, interesting models of corporate social responsibility, or examples of non-profits that are run like an entrepreneurial businesses. Also, I’d love any thoughts on the graying of the for-profit and non-profit sector and any thoughts on infusing entrepreneurial principles and efficient management into government. Thanks for reading! – Ryan

OptInNow.org – Opportunity International’s New Kiva-Like Site

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This is something really cool.

I had coffee this evening at the HW55 Starbucks in Durham with Sam Serio from Opportunity International. Opportunity International is a Christian microfinance organization that’s been around since 1971.

Opportunity International has launched a site called OptInNow.org. OptinNow allows you to make small loans directly to entrepreneurs in developing countries.

Comparison to Kiva

OptInNow is similar to Kiva, with the exception that the loans made are contributions to Opportunity International and are re-loaned over and over again to entrepreneurs with microenterprises in developing countries instead of paid back directly to the lender. Another difference is that Opportunity International has a Christian affiliation whereas Kiva does not.

OptInNow.org is in the early stages, so the site does not yet have as extensive inventory of loans and projects as Kiva, but does allow loans to be made to entrepreneurs in Kenya, Ghana, the Philippines, and Mexico with many more to come soon.

Props to the folks at Opportunity International for creating a well-designed usable interactive site that will get a lot more visibility and unique donors for their organization.

Aid 2.0

As opposed to the old-school ‘top-down’ Easterly-criticized bi-lateral government-to-government aid model where funds were given to oft-unelected semi-corrupt dictators for cold-war geopolitical reasons that indebted the populace without providing much benefit to them while sometimes forcing the funds to be used to pay Western contractors (okay I’m being a bit harsh here but do read Perkins’ Confessions of an Economic Hit Man and Stiglitz’ Globalization and Its Discontents), OptInNow’s model is from the grassroots–from the bottom-up. It gives small amounts of funds that can make a world of good directly to the local entrepreneurs who know how to best use them. It’s market-based aid versus the top-down centrally controlled aid of the past.

Who Is It Run By?

Opportunity International is currently run by CEO Christopher Crane, an entrepreneur, YPO member, and Harvard MBA who took commercial real estate information provider COMPS InfoSystems to 450 employees and took it public in May 1999 before being acquired by CoStar (NASDAQ:CSGP) in February 2000. I haven’t met Christopher yet but look forward to meeting him soon.

Here’s a video about OptInNow. Spread the word!

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About Opportunity International

Opportunity International, the largest not-for-profit microfinance organization in the world. OI began in 1971 and specializes in working with the poorest of the working poor, those who make less than $2 a day. OI has 1.2 million active loan clients in 28 countries and 85% of their clients are women. Here are some key facts.

Opportunity International 2007 Highlights
Current loan clients worldwide:	1,121,786
Value of current loan portfolio worldwide:	$500,891,820
Number of loans made in 2007:	1,772,139
Value of loans made in 2007:	$702,278,911
Average loan size:	$227 (excluding Eastern Europe)
Average first Trust Group loan:	$162 (excluding Eastern Europe)
Loans to women:	84.13%
Loan repayment rate:	98.5%
Source: http://videos.opportunity.org/website/media-center/Opportunity_International_Fact_Sheet.pdf

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About OptInNow
Our mission is simple. We’re working to end global poverty. Faster. How? By providing those who live in chronic poverty with one vital thing they need to transform their lives: Opportunity. Along the way we hope to transform additional lives, like yours. That’s why we’ve made it so simple for good people everywhere to come together, to fund small loans, to witness big and lasting impact, and to truly change the world. That’s what we’re really about. We’re about every land becoming a land of opportunity. And with your help we’ll get there.

Life Update: March Whirlwhind + The Summit Series Aspen

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I’m in the Chicago O’Hare hotel tonight. I’m so very excited to have 3-4 hours to read and write. I leave in the morning for Aspen to attend The Summit Series, an event that is bringing together 120 of the top entrepreneurs and social entrepreneurs in the country. I can already tell from the attendee list I just received that it will be a worthwhile three days on both the business and social justice side.

The last four weeks have been non-stop. It’s been passion-filled entrepreneuring and social entrepreneuring. Love it.

At the beginning of March I had the opportunity to speak at Yale University at the StartingBloc Greater NY Institute. I spoke on “A Vision for Our World in 50 Years.”

In mid-March I spoke at the Montgomery Tech Conference in Santa Monica to present iContact and meet with investors and saw Tim Draper of DFJ do an excellent rendition of The Riskmaster. I spoke at Southeast Venture Conference in Atlanta the next day to present an update on iContact to investors.

On March 6 I had the chance to visit The White House in D.C. to attend a Summit of Young Entrepreneurs and heard Macon Phillips, Yosi Sargant, David Washington, Michael Strautmanis, Jason Furman, Martha Coven, Greg Nelson, and Heather Zichal of the Obama Administration present on what they were working on to make an impact in the areas of the economy, budget, healthcare, energy, the environment, and transparency.

March 20, I hosted Entrepreneur & Social Entrepreneur Meetup #27 at my house in Chapel Hill where Nate Seaman of Bike and Build (he’s biking across the USA this summer to build and raise funds for low-income housing), Gene Nichol of the UNC Center for Poverty, Work, and Opportunity, Dan Moore from Triangle Gives Back, and Michael Kelso from the startup Briteroots presented for 7 minutes each.

The peace activist inside of me was stimulated on March 26 when Betty Bigombe spoke at UNC’s FedEx Global Center on what she learned negotiating peace in Uganda between the Museveni Government in the South and the LRA in the North.

At the end of the month I attended StartingBloc’s NYC Institute at NYU Wagner and Columbia Business School. I heard presentations by the passionate Robert Egger of DC Central Kitchen, Ami Dar of Idealist.org, and environmental activist Majora Carter of Sustainable South Bronx.

Finally on March 30th, I was inspired to build schools in developing countries as a way toward lasting peace and security when Greg Mortenson of Three Cups of Tea fame spoke at UNC. He has built dozens of schools in Afghanistan and Pakistan.

Here are two memorable quotes from Mortensen’s talk:

“Fighting terrorism is based on fear. Promoting peace is based on hope” – Greg Mortensen
“The solution to terrorism is education, not bombs.” – Greg Mortensen

Other notable events in March were the Nourish International (side note: if you’re in Raleigh, Nourish is hosting a fundraiser on April 17 called Brew Local, Act Global at Mosaic Wine Lounge from 6pm to 8pm) and Leadership Triangle Board Meetings, an Entrepreneurs’ Organization Forum, and an EO Raleigh Recruiting Event and Jess Lipson and Brooks Bell’s house. EO Raleigh is working to bring together the largest group of successful entrepreneurs in the Triangle.

On the personal side of life, I fit in visit to the wonderful NC Museum of Art in Raleigh, three ultimate frisbee sessions at UNC’s Carmichael Fields, and celebrated with my mom for her 57th birthday.

In the book world, right now I’m reading An Assault on Reason by Al Gore, Three Cups of Tea by Mortesen, and Mastering the Rockefeller Habits by Verne Harnish.

At iContact, we’re up to 162 full-time employees, 159 of which are based in our Durham office. We hired six new team members last month and are continuing to hire in customer service, sales, and development. We passed the $2M in monthly sales milestone for the first time in March. Because we hit this stretch goal, I’ll be dressing up like Tina Turner (with wig, shaved legs, mini-skirt and all) on April 17th. I was able to extract a few commitments from other members of our Director team…

• Chuck Hester will sing the UCLA fight song at the April company lunch, wearing a UCLA jersey
• Ken O’Berry will dress up as Steve Perry, complete with tuxedo tails, and sing Don’t Stop, Believin’ at the April Company Lunch
• Sarah Stealey will take a $25 gift card, go to Wal-Mart, buy an entire outfit (shoes included) and wear the outfit to work (and yes, the trip to Wal-Mart will be videotaped)
• Cindy Hays, David Rasch & Brandon Milford will dye half their hair iContact Green and the other half iContact Blue
• Eric Sternkopf will come to work on day in April dressed as his favorite artist, The Prodigy.
• Tim Oakley will come to work on a day in April dressed as Michael Jackson.
• Robert Plumley will auction off the right to put a cream pie in his face at the April company lunch to the highest bidder and donate the proceeds to The Shriners’ Hospital in Greenville
• Kevin Fitzgerald, Aaron Houghton, Ralph Kasuba, and David Roth will rewrite the lyrics and perform a song parody video of “We are the World” – renamed “We are not SPAM” and put it on YouTube

Whew. What a month!

MIT IDEAS Competition Slides – The Great Opportunity of Our Generation

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I wanted to post my Powerpoint slides from the presentation I gave at MIT for their 2009 IDEAS Competition on Monday night. You can view them on Scribd or below via this blog post.

The topic was “The Great Opportunity of Our Generation”

Some of the formatting is off in Scrib but mostly OK…

MIT IDEAS Social Entrepreneurship Competition, Ryan Allis, The Great Opportunity of Our Generation, May 200…

Here are some notes from the award ceremony following my presentation from Joe Chung. Congratulations to the winners! AquaPort, HeatSource and EGGTech were especially interesting to me.

Opening: Nick Fontaine
Keynote: Ryan Allis

Chancellor introduced
$2.5k IDEAS Award Winners
Aquaport
Oladapo Bakare
Ashley
Mary
Rob
Joonhaeng
Ash
Rebecca
Daniel
(water filtration)

Professor Thomas Byrne introduced
$2.5k winner
Vision Group (seeing machine)
Quinn Smithwick
Brandon Taylor
Yi Fei Wu
(project image directly into eye, bypass distorting part)

Barbara Baker introduced
$5k IDEAS Award winner
sponsored by Baruch Family
Global Citizen Water Initiative
Scott Frank
Stephanie Bachar
(place water in tube for 24 hrs to see if clean)

Allan Powell introduced
$5k IDEAS Award Winner
sponsored by The MIT COOP
BLISS
Saba Gul
Dr. Ishrat Hussain
Nadeem Mazen
Ghanzala Mehmood

Presented by Dean Stephen Lerman
$5k IDEAS Award Winner
sponsored by the office of dean of grad education/Yunus Challenge Winner
EGGTech Blandine Antoine Emmanuel Cassimatis Alla Jezmir
(providing battery for lighting to those in tanzania without electricity)

Yunus Challenge Winner
$7,500 IDEAS Award Winner
Lebone
Alexander Fabry
Aviva Presser
Hugo Van Zuuren
(microbial fuel cell solution for providing electricity)

Presented by Professor Thomas Byrne, MD
$7,500 IDEAS Award Winner
Braille Labeler
Aleksander and Anna Anita Leyfell
Adelaide Calbry-Muzyka
Josh Karges
Karina Pikhart
Maria Prus
Rachel Tatem
(electromechanical braille labeler)

Presented by Professor Michael Cima
Sponsored by the Lemelson – MIT Program
$7,500 IDEAS Award Winner
HeatSource
Amy Qian
Celeste Chudyk
Scot Frank
Allen Lin
Mary Masterman
Catlin Powers
Saad S
(encapsulating solar radiation through textile/material that provides heat during night)

Winner’s Retreat 2 Days at Endicott House

Malaria Kills – Send a Net, Save a Life, Go to Africa

Dare Mighty Things Blog Readers–

I am in a Social Media Giving Contest to see who can generate the most unique contributions by this Sunday April 12 at 8pm ET to Nothing But Nets, a campaign to eliminate malaria in developing countries. So far I have 7 unique contributors and if I can get it above 50 I’d be in the lead. I think I might have a good chance with this blog post and announcing it at The Public Policy Forum Meetup tomorrow night at our house to get in the front.

Would you contribute ten bucks at https://www.causes.com/fb/donations/new?cause_id=183&fundraiser_id=1604&m=38d81d22?

If I get the most unique contributions by Sunday night at 8pm ET I will win a trip to Africa with Nothing But Nets and the UN Foundation to distribute the nets. Wouldn’t that be awesome!

You can win a trip to Africa too. One contributor will be selected at random to receive an all-expense paid trip to Africa to distribute the malaria nets later in 2009 with the UN Foundation. A $10 donation will provide an insecticide treated malaria net that lasts five years that two children can sleep under.

It’s not about how much we raise, but how many unique individuals I can convince to give. Malaria infects more than 500 million people a year and kills more than a million. One person dies about every 30 seconds from malaria.

This contest is part of The Summit Series, an event I was at last weekend in Aspen. All proceeds of the contest benefit the Nothing But Nets Campaign of the UN Foundation.

Nothing But Nets is a global, grassroots campaign to save lives by preventing malaria, a leading killer of children in Africa. Inspired by sports columnist Rick Reilly, tens of thousands of people have joined the campaign that was created by the United Nations Foundation in 2006. Founding campaign partners include the National Basketball Association’s NBA Cares, the people of The United Methodist Church, and Sports Illustrated. It costs just $10 to provide a long-lasting insecticide-treated bed net to prevent this deadly disease. To date, Nothing But Nets has raised more than $25 million and distributed over 2.5 million nets to children and families in Africa.

All contributions are secure and tax deductible and are run through the Nothing But Nets Cause on Facebook. Thank you so much for your help!

The link to make a contribution is https://www.causes.com/fb/donations/new?cause_id=183&fundraiser_id=1604&m=38d81d22

Thank you so much for your help!

Sincerely,
Ryan Allis

Zappos CEO Tony Hsieh Presents on “The Path to a Billion” | Dare Mighty Things

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Tony Hsieh, the 34 year old CEO of Zappos is giving a talk at the Underground web marketing seminar in Los Angeles. He sold LinkExchange to Microsoft for $265 million in 1998.

His speech is titled The Path to $1 Billion as they are on track to hit $1B in sales this year as a private company that started in 1999, did $8.6 million in 2000 and $32 million in 2001. They have 1,600 employees today and a 500 person call center.

Tony is emphasizing the importance of ‘above and beyond’ great customer service more or less regardless of cost. 75% of his orders are from repeat customers. He talks of ’surprise upgrades.’

Tony shared that they orient new team members with 4 weeks of customer loyalty training at their headquarters in Las Vegas plus week in Kentucky for warehouse training for every single employee. He tells the story of when a customer ordered pizza from their customer service line at 3am and the customer rep found the nearest pizza places in Santa Monica that were still open.

He encourages entrepreneurs to train great people if you want the company to scale as ‘you can’t do everything yourself.’ He provides a culture book to their team members each year. Every single team member writes a couple employee on what the culture means to them.

Their core company values are:

1. Deliver WOW through service
2. Embrace and drive change
3. Create fun and little weirdness
4. Be adventurous, creative, and open-minded
5. Pursue growth and learning
6. Build open and honest relationships with communication
7. Build a positive team and family spirit
8. Do more with less
9. Be passionate and determined
10. Be humble

I am wondering what their customer acquisition cost and customer lifetime value is and what their monthly CPM and CPC spend is and what networks they use to acquire customers via CPA.

Endeavor – Promoting Entrepreneurship in Middle-Income Nations

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A Non-Profit Profile By Humanity Campaign Writer Ebs Sutton–

Recently, a non-profit organization by the name of Endeavor was profiled in the July issue of The Economist, in an article which gave rave reviews of the group’s commitment to providing not just access to opportunity, but access to the mentoring and investment which turns opportunity into actuality.

When it comes to promoting entrepreneurialism in developing nations, Endeavor believes that a significant part of the problem is not just a lack of access to entrepreneurial possibilities, but a lack of access to the modeling and mentorship which are available in places like the United States. Endeavor seeks to address this need by using successful high-impact entrepreneurs in developing nations to select and mentor budding entrepreneurs in developing nations.

The Purpose of Endeavor

Endeavor is a non-profit organization whose vision is to change communities and countries by promoting entrepreneurship where it is needed most. Using their internal Search and Selection teams as well as panels of successful entrepreneurs from across the globe, candidates for the Endeavor program undergo a rigorous selection process which can take up to 18 months. Endeavor uses six main criteria to evaluate candidates:

• Entrepreneurial Initiative
• Business innovation
• Value and Ethics
• Role Model Potential
• Development Impact
• Fit with Endeavor

Additionally, through the course of this process, each entrepreneur is given valuable feedback and advice, whether or not they are selected. Once entrepreneurs are selected according to the criteria, they are set up with mentors and access to support and advice. Endeavor matches the entrepreneur with selected mentors who can help him or her with specific challenges faced. Some Endeavor Entrepreneurs can have over a dozen mentors.

Interview with Elmira Bayrasli

I had a chance to interview Elmira Bayrasli of Endeavor’s Outreach Team via email. She described the Endeavor process this way:

“Generally Endeavor looks for high-impact entrepreneurs who are leading companies that are generating between 500K to 20 million in revenues; and entrepreneurs who have role model potential – who will give back to their emerging market communities and not only inspire, but lead, mentor and support aspiring entrepreneurs. Endeavor Entrepreneurs generally are those who have a business that has great high-impact potential to go to scale – to create jobs, generate revenues and investment opportunities.”

The Process

Here is an image showing their selection process from their 2007 annual report:

Many selected entrepreneurs go on to become mentors themselves. Some serve as panelists or as members of local boards of directors.

Before this process even begins, Bayrasli says, Endeavor does its homework:

“Before Endeavor starts to identify and support high-impact entrepreneurs, we spend quite a bit of time building local operations. Endeavor will only launch its ‘mentor capitalist’ model for high-impact entrepreneurship in countries where there is actively backing and engagement from leading business talent and recognized leaders. These individuals form the basis for Endeavor’s local board of directors.”

Here is a graphic that shows the Endeavor “idea to impact” process:

Examples of Success

This year Wences Casares became the first Endeavor Entrepreneur to join Endeavor’s Global Board of Directors. An Argentinean entrepreneur, Casares founded Patagon, an Argentinean online brokerage; Wanako Games, a developer of video games fueled by Latin American creativity; and Lemon Bank, a Brazillian bank designed to help the poor.

Of the roughly ten Endeavor Entrepreneurs profiled on the Entrepreneur website, one in particular stood out to me. Natallie Killasy began a company called Stitch Wise which sews mine safety gear in the Gauteng Province of South Africa. After realizing how many miners were seriously and permanently injured in mining accidents, she customized sewing machines to provide work for disabled miners. The products started as protective rainwear and eventually moved into safety equipment to prevent underground collapses. According to the Endeavor website, “these products are now industry standard and are critical to the industry.”

Some Reader Criticisms

Five out of the eight responses to the article posted on The Economist expressed concern. One concern is that Endeavor is addressing the wrong issues when it comes to entrepreneurialism in developing nations. It is stated main challenges faced are not a lack of well thought out ideas or good business strategy but rather the bureaucracy, corruption, unreliable infrastructure and poor access to loans which plague most emerging economies. Another concern is the Endeavor selection process and its rigorous search for entrepreneurs already brimming with potential. The term “picking winners” appeared twice in reader feedback, seeming to imply that Endeavor has an ulterior selfish motive. If Endeavor strives to “picks winners”, one wonders, are they truly developing an entrepreneurial spirit or just helping an elite few gain their feet?

From my perspective, Endeavor appears to be effectively carrying out its mission and creating lasting positive change in developing nations. Certainly the concerns Economist readers raise regarding the “real” challenges facing entrepreneurs in developing nations are undeniable. I spent 13 years in one of the poorest, most corrupt countries in the world and witnessed the bureaucracy, unreliable infrastructure, and corruption firsthand. However, it takes one look at the Endeavor site to see the statistics supporting their success in countries such as Brazil, South Africa, Argentina, Chile, Uruguay and Mexico. Endeavor currently works in 11 countries and hopes to expand its reach to include even more.

Picking Winners

Although it may seem that Endeavor only helps an elite few, “picking winners” could be a necessary part of smart strategy. With all the possible Endeavor Entrepreneurs and limited Endeavor resources, Endeavor has to pick entrepreneurs showing the most likelihood of success. It’s about investing precious time and resources wisely it seems.

At a relatively young 11 years old, Endeavor is a welcome addition to the scene of international sustainable development.This noted, it has so far focused its work in middle-income countries like Argentina, Brazil, and Turkey and not in the most impoverished “developing countries” where arguably they could create more social value. Though certainly not the only organization addressing entrepreneurial needs in developing countries (Technoserve, for example, has a very similar purpose) Endeavor is energetic and effective in fulfilling its purpose.

Video on Entrepreneurship & Goals: Work Your Way Up | Dare Mighty Things

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In June 2008 a young entrepreneurial filmmaker by the name of Patrick Sargent came out to the iContact office in Durham to do a documentary on entrepreneurship. His film, Work Your Way Up, launched today and is available on his website. Here’s the trailer.

And here’s an excerpt from the film where I talk about the immense impact the simple act of writing down my goals, framing them, and putting them in my closet has had in my life.

Here are some words from Patrick: The purpose of Work Your Way Up was to create a film for aspiring entrepreneurs that they could use to guide and inspire them on their journey as entrepreneurs. This project came to fruition about a year ago when I was scouring the market for a film on entrepreneurship for aspiring entrepreneurs. After lots of searching I realized something. There weren’t any.

It was at this time that I decided I was going to set out to make one myself. It was going to be difficult but I knew that if I approached it right I could make a commercially viable film for aspiring entrepreneurs. I started pre-production on Work Your Way Up in May, started shooting in July, and now nearly nine months later Work Your Way Up has become a reality. Work Your Way Up is unlike anything that’s been made before. It’s a film aimed directly at aspiring entrepreneurs. Work Your Way Up speaks directly to the heart and soul of the entrepreneur. The film proves you that you absolutely can do it. This is shown to you directly from the life lessons of those who have already created successful businesses. The full video is available now at http://www.workyourwayupfilm.com.

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