The GuideStar Blog retired September 9, 2019. We invite you to visit its replacement, the Candid Blog. You’re also welcome to browse or search the GuideStar Blog archives. Onward!

GuideStar Blog

Building a Business Plan Around the 'Engine for Good'

image001The pursuit of corporate profits results in many of the world's greatest tragedies — churning out pollution, perpetuating racial stereotypes and deepening income inequality. But what if it were profitable to do good? What if the more good a company did for the world, the more profits it made? Could we reverse our destructive path?

As an MBA student in the mid-'90s, I was awed by the power of the markets. Business models that generate profits are often able to steamroll over any obstacle in their path. Instead of fighting this force head-on, I figured we could use some business jujutsu to redirect that power for good.

That was my goal when I started Care2, now a 27-million-member online community. I call our business model an "Engine for Good" because it is fueled by good actions and its output is good actions. Literally, the more good people do, the more revenues we generate, allowing us to invest in helping people do even more good.

How can a company generate profits by helping people to do good? For our model, the secret is petitions. Millions of individuals start and support free online petitions for good causes. We then serve as a matchmaker to connect individuals with nonprofit organizations that sponsor petitions. Individuals get to make a difference, while nonprofits — which spend over $20 billion annually prospecting for donors (mostly via outdated direct mail and telesales models) — save time and money connecting online with prospective donors.

Today, numerous startups are realizing it's possible to do well while doing good. Etsy makes money by empowering home micro-enterprises, Method Products sells non-toxic personal care products, Indigenous Designs sells organic fair trade apparel, D.Light distributes solar products to underserved locations. Profits don't have to come at the expense of sustainability or values. In fact, these new profits may just be what's needed to build a brighter future for all.

Randy Paynter Randy Paynter

The preceding is a guest post from Randy Paynter. Randy Paynter is the Founder, President and CEO of Care2 and The Petition Site. He is a pioneer in the online advocacy field that is dedicated to helping empower others to collective action in support of their social and environmental causes. Randy's innovation of the "Engine for Good" model, whereby good actions generate revenue that fuels more good actions, is the basis for how Care2 and The Petition Site are run. He is a frequent speaker at conferences including Bioneers, Social Venture Network, Silicon Valley Boomer Venture Summit, SoCap, Aging in America, LOHAS, AARP and Green Festivals. Randy hold an undergraduate degree from Harvard University and an MBA from Standford's Graduate School of Business.

Topics: Nonprofit Leadership and Practice