JONATHAN KAPLAN: Good morning, everyone. I’m Jonathan Kaplan, president of Walden University. And I’d like to welcome all of you to our fifth annual Social Change Conference. In addition to those of us in the room today, we’re also joined by 600 guests throughout the world via live webcast.
This year’s conference is centered on the theme of social entrepreneurship, taking action, leading change. This call to action is at the heart of everything we do at Walden University, educating our community to serve as scholar-practitioners who will transform society. At Walden, we believe that knowledge is most valuable when put to use for the greater good. We’re deeply committed to improving the human and social condition by creating ideas and applying them to advance society as a whole. Our core mission can be summed up in three simple words: positive social change.
Today, we’re going to explore how we can make the greatest impact through the work of active social entrepreneurs, practitioners, government leaders, thinkers, and doers in the field, something that I heard former President Clinton mention just a few days ago as 21st-century citizenship. And I think that speaks volumes about what we mean by social entrepreneurship and the impact that all of us can have.
This conference is not shaped to be just an event, but a cause, a cause that will encourage and enable participants to stretch their thinking and take action. Our esteemed group of speakers and panelists today will provide valuable strategic insight and expertise to help each and every one of you have an impact.
Today, as we sit here in Washington and read the morning papers, we’re in the midst of yet another political debate, with those who push for market solutions on one side and those who advocate government solutions on the other, with citizens predictably stuck in the middle, trying to figure out and determine which sector should lead us into the future. I think most of us have seen this movie and we know how it ends, with the usual stalemate and gridlock. That’s neither taking action nor leading change.
But importantly, and I think a key theme for us today in this conference is that there is a third way, one rooted in partnership. And this is the work of social entrepreneurs. They bring together concern for the public good with the innovation and drive required in a market economy. They believe that the same entrepreneurial spirit that has driven great economic progress can also foster new solutions to complex social problems all over the world.
As you participate in this conference today, I encourage you all to think about how you can play a part in supporting social entrepreneurs and in leading change with them. In this room, we come from a variety of different sectors—from government, from education, from business, and from the nonprofit world. But we share a commitment to building a better world.
In just three days, Walden students, alumni, faculty, and staff will participate in our fourth annual Global Day of Service. And this year, volunteers have committed to working on more than 40 projects all around the world. From Atlanta to Amsterdam, from Mexico to Minneapolis, we will be feeding the hungry, rebuilding neighborhoods, and teaching young minds. This kind of action is crucial as we work towards social change, our mission as a university, and find ways to apply knowledge in service of the greater good.
But the action of social entrepreneurs goes much deeper. It is about more than acts of individual generosity. Social entrepreneurs are builders, creating institutions that have an outsized effect on the world around them. And they create organizations that spark new ways of thinking and offer new solutions to the questions facing our world.
Before I introduce our first featured speaker, I would like to share one last thought about the ways that social entrepreneurs inspire change. And I quote, “We are at a moment in history where we truly have all of the resources we need to take on and solve some of our toughest social problems. We also have a cadre of committed social change agents who are fully dedicated to leading the charge to end poverty, homelessness, educational inequity, and global warming. They are leading a quiet revolution, a revolution for positive social change”—I love those words—“positive social change. And I truly believe in my lifetime, we’ll see the end of some of these terrible afflictions that rob people of equal opportunity and hope.”
That quote, including the positive social change reference, comes from our first speaker, Dr. Cheryl Dorsey, a pioneer and advocate for social change in all respects. Dr. Dorsey was named president of Echoing Green in 2002. She is the first Echoing Green fellow to lead this global nonprofit which has awarded more than $28 million in start-up capital to over 450 social entrepreneurs worldwide since 1987.
Echoing Green is one of the original funders of social entrepreneurs. And through two-year fellowships, the organization supports individuals and initiatives with the power to effect true change and provide seed money and strategic advice to help them succeed. The organization helped many of the world’s most prominent social organizations to get their starts, including Teach For America, City Year, and the Genocide Intervention Network.
Dr. Dorsey is a true public policy innovator, serving in the White House during the Clinton Administration, where she helped develop family-friendly workplace policies and spearheaded the Labor Department’s pay equity initiative. And I know she’ll be pleased to know that Lilly Ledbetter, a great pay equity advocate, was our commencement speaker this summer at Walden University.
Most recently, Dr. Dorsey was appointed vice chair of the President’s Commission on White House Fellowships. Her remarks today are about how to be a social change agent through cross-sector collaboration. Please join me in welcoming Dr. Cheryl Dorsey.
DR. CHERYL DORSEY: Good morning. Thank you all for having me here. President Kaplan, it is a great pleasure and honor to join you all for today’s conference on social entrepreneurship. Those of us who have toiled in this field for 20 years are a bit overwhelmed these days by all of the attention and excitement and enthusiasm for the work that we do. So I’m just thrilled to be a part of this conversation with you.
And I do hope that it is a conversation. I talk about all of this stuff all of the time. So in fact, for me it’s interesting when it is a conversation and a dialogue instead of me talking at you. So I would enjoy if, you know, you want to raise your hand or yell out something during my remarks. Please do that. I won’t talk for that long, because I actually really do want to engage in a conversation with you all about this very exciting moment for our field and this historical moment in general.
So I just, again, want to start by thanking you all for having me here at this fifth annual Social Change Conference. I was coming back from New York last night and was on the train watching some of the online videos for Walden University’s Scholars of Change video contest. And I didn’t get a chance to watch all of them, but I got to watch some of the Walden University students talking about their commitment to social change. It was very moving. And I just want to acknowledge a couple of the videos; they were all phenomenal, but a couple of the videos that I think show well what social change and social entrepreneurship are all about.
One of your students, Mike Brennan, a young man who talks on his video about how a horrific racial profiling event in Europe really turned him into a human rights advocate and activist who is now leading a human rights campaign around racial profiling that has involved the U.N. and other groups like Amnesty International. I thought that was a very interesting example of how you turn something personal and an individual experience into a cause that matters to many more people than just yourself. That was really terrific.
And then another one of the Walden University students, Mr. Tom Bailey, who was a high school teacher, I think it’s at Elmhurst High, who talked about his work with the students, but talked about his outcomes-driven focus with his students, talking about the significant academic achievement gains that he was noticing and helping his students achieve in the classroom. And that sort of attention to outcomes metrics, measurements, I think is a really important part of the social entrepreneurship and social change conversation these days.
And then finally, Walden University student Mary Ross, I think maybe she’s a nurse, but she’s studying for her [Ph.D. in Public Health], talked about her work in Africa around the emerging epidemics of hypertension and diabetes. And, you know, most of my work is domestically focused. But to hear this public health professional talk about chronic illnesses that are so much a part of our public health conversation here, but that [don’t] get any attention in the global context, I felt, was a really compelling example of how social entrepreneurs are helping to bring to the fore and bring attention to emerging issues and problems that the rest of us are not yet talking about. So I thought it was a really terrific set of videos. And I think it’s a great example of how Walden University is really working with its student body to be on the frontlines of social change.
Could I get a show of hands? How many people have heard of Echoing Green, know anything about it? Wow. Okay, great. Normally in a room, I might get a couple of hands going up, in part because the work that we’ve done over the past 22 years has been quietly. And it has never been about Echoing Green, the institution, but really about the social entrepreneurs that we serve. So I think I’m going to start by talking a little bit about who we are and the field in which we work.
So Echoing Green was founded 22 years ago by the senior leaders of a very successful private equity firm. And President Kaplan talked about cross-sector collaborations. Echoing Green is a very interesting example of how the private sector, when turning its attention to philanthropic endeavors, really started to think differently about how they might be engaged in the philanthropic landscape.
And Echoing Green, as President Kaplan said, really was one of the first enterprises focused on funding social entrepreneurs. And when the history of the founders of Echoing Green, who started a private equity firm called General Atlantic, when the history of that decision is written, it is a very interesting example of how you can adapt business principles and practices and apply them to the social sector.
So throughout the course of my talk and in remarks, you’ll probably hear me lapse into very familiar business lingo, talking about the investments that we made, talking about a social capital marketplace. You’ll see sort of again [this] blurring of boundaries between sort of the social sector and the business sector. And I think that is emblematic of the way that many social practitioners do their work.
So I think the genius behind the founding of Echoing Green was that in their daily business lives, the leaders of General Atlantic placed bets. They invested in talent. They invested in visionary leaders with ideas. And these were for-profit ideas, business ideas. But they had an insight that, what if we could apply our way of doing business to the social sector? What if we invested in entrepreneurs, but social entrepreneurs? Could we get a significant return on investment or social return on investment?
So essentially Echoing Green was one of the first global social venture funds to provide seed capital and technical support to some of the world’s best emerging social entrepreneurs. We are angel investors. So we’re first funders in. Essentially, we are investing in the human technology, the human capital of social change. When our applicants get to us, they’ve got an idea on a piece of paper. They’ve got tremendous passion and belief in their ability to be part of the solution, as opposed to the problem. But there’s nothing much else there.
So it is our job to provide that risk capital to allow them to hopefully launch these new social change endeavors. And as President Kaplan mentioned, we were first funders, early funders of such luminary social enterprises as Teach For America, City Year, Genocide Intervention Network. But again, there are hundreds of other entities in which we’ve invested in 40 countries around the world, in I think 41 or 42 states across this country.
Any of you here in the Washington, D.C., area, working here? So we have funded quite a number of social entrepreneurs working here, especially in the education reform sector. You might be familiar with the SEED School over in Anacostia, the nation’s first urban public boarding school. If any of you—I live over in Logan Circle. So off of our street, the Maya Angelou Public Charter School, an alternative high school for young people. If any of you know the after-school program, Heads Up, that places college students in elementary schools to work with young people.
And the list goes on. What I think is actually interesting about Echoing Green, we are both program-agnostic and geographically agnostic. And that’s what I’ve always loved about Echoing Green, that at the end of the day, we believe that if you place resources behind people, indigenous community leaders who know their communities better than any funder ever could, and you give them room to run, that that’s where you have the greatest potential for transformative change.
And it’s interesting for any of you who work in the social sector. One of my great frustrations over the years of a traditional funding relationship is sort of that weird power dynamic. So in some ways, you go into the funder. It’s very much like the supplicant to the funder saying, “Oh, please give me money.” You know, funders have a particular view of the world, and you, as a nonprofit leader, are essentially forced to try to fit into their view of the world to get that institution’s money.
And again, I’m privileged to say that Echoing Green has never operated like that. It has always believed in the power of the entrepreneur to know its community best. And if you can make the case to us why your new idea for social change merits funding, we’ll fund you. And I’ve always liked that. We’re generalists. We’re not experts on any particular area except in our ability to spot talent. So that’s one thing.
Are we good at what we do? Because, again, I’ve talked about metrics and outcomes. It’s tough for us because, again, we’re investing in people. And in many ways, our investment is very much about patient capital, right? Because it could be 10, 15, 20 years before we know if any of our investments have paid off. But I can give you some sense that after 22 years, we’re pretty darn good at what we do. So I mentioned that we’re start-up funders. So I can say that about 66, 67 percent of the organizations that we help launch are sustainable in the short-, medium-, and longer-term. For those of you who know how hard it is to start businesses, that’s tremendous. Most new businesses fail. And the fact that we’ve got a success rate of about 67 percent is pretty significant.
In addition, we really do pride ourselves on being a pipeline of some of the best young leadership into the social sector. So about 85 percent of the young people that we fund remain in the social sector in key leadership positions. And these are folks who have been recruited by Wall Street. Or they could go work for McKinsey, or they could work for President Kaplan at Walden. But they’ve chosen to be nonprofit leaders, social sector leaders of a particular type, and devote their intellectual capital to taking on some of the toughest social challenges of our day.
You know, I’m not going to embarrass you, Tony, but Anthony Jewett, Tony Jewett sitting there is an Echoing Green alum, a Morehouse grad who started a wonderful program called Bardoli that works with young people of color to provide them with international study-abroad experiences. So talk to Tony more about his journey as a social entrepreneur, about the work he’s doing in this field, and about his experience as an emerging and young social entrepreneur.
And then lastly, this is sort of a rough statistic, but I think it bears mentioning, dollars in versus out. You know, we’re a small fund. We give small grants. But collectively, we’ve invested about $28 [million], $29 million in these 400-plus social entrepreneurs working around the world. They’ve gone on to garner an additional, it’s about a billion dollars in additional capital for their cause. That’s in government funding, private funding. So collectively, this billion dollars, a tremendous ROI, $44 out for every dollar invested. That’s pretty significant.
So I think I do have the credibility to stand before you as an employee and as the head of Echoing Green to say we do know the field of social entrepreneurship quite well. And it’s an exciting field. It’s relatively new when you sort of look back over the literature. It’s only, you know, been talked about in the literature for about the past 25 years. Make no mistakes—social entrepreneurs have existed for as long as there have been people who cared about problems in their community. It’s only in the past 25, 30 years that people have named it, have named this phenomen[on].
So, you know, quite often people say, “Well, what about,” you know, “… the wonderful social activism from,” you know, “… the 20th century?” I think a lot of that work qualifies absolutely as social entrepreneurship. But again, the term, the phraseology has only ascended in the past 25 to 30 years. And when you look at sort of the two schools in our field, there’s sort of a school of thought that we talk about as the social innovation school. And if any of you know Bill Drayton and Ashoka, he is considered the father of that school of social entrepreneurship. It’s this notion that there are particular and unique social sector actors. They’re different than most nonprofit leaders. And they have a particular vision, a particular way of doing business, a particular focus on innovation and execution that makes them different and transformative relative to other leaders in their space.
And that’s really the school that Echoing Green’s work falls within. The other school in our field is called the social enterprise fund. Many people consider Ed Skloot, who used to be the president of the Surdna Foundation, to be the father of that field. In 1980, he founded an organization called New Ventures, which was a consulting firm that worked with nonprofit organizations to help them become sustainable entities.
And again, for all of those of you who work in the social sector, you understand this notion of, you know, revenue generation, you know, economic viability. It is really, really hard. I mean, you know, there are about 1.4 million nonprofits in this country—way, way too many. Let me just say that. Less than six percent even have budgets over a million dollars. So we’ve got a really crowded, underresourced field, duplicative field. And that makes, you know, financial viability really tough for a lot of us. So again, part of the thinking in the social entrepreneurship field is, what sort of systems, processes can you put in place to lead to more viable, sustainable entities over the long term?
So these two fields sort of collide[d] and came together to this really interesting conversation we’re having now around social entrepreneurship. And why all this excitement? So, a couple of reasons.
There are really interesting forces at play. So I sort of look—if you look back over the past 100, 125 years, you can sort of see these various epochs the way that our society has looked at its relationship to the less fortunate, its relationship to government and citizen action. And, you know, you sort of look in the late 1880s, 1890s when the whole tradition of the social gospel was at the fore.
And it was this notion that individuals, because of their close attachment to their religion traditions, had a responsibility to help and support the less fortunate. And it was sort of the first time with a great deal of urbanization, many people coming together in collective ways to think about how they related to institutional forces and institutional structures. So at that time, you had many charitable endeavors sort of bubbling up, leading us to really think about our relationship with our less fortunate brethren.
Then you sort of get into the 20th century, and you get into the era of FDR, the social safety net, this notion of big government. What can government do to provide that support, that floor for the less fortunate?
Then when you sort of get to the ’70s, ’80s most particularly, a part of the Reagan revolution where you actually see government as part of the problem, not part of the solution, you see a great deal of devolution, this belief that government will muck up anything it gets its hands in. And you actually at this point start to see a lot of the rhetoric around social innovation and social entrepreneurship come to the fore, that citizens can do it better than the government. Citizens are more nimble. They’re not mired in the bureaucratic morass that is the government. They’re not tethered by all these political and ideological conversations. Let citizens do it.
And a lot of that momentum and energy around that thinking sort of spurred on the emergence of social entrepreneurship. You also have very great champions in the folks that I call, like, the über-entrepreneurs, like the gazillionaires, like the Bill Gateses of the world, the Jeff Skolls of the world from eBay, Pierre Omidyar from eBay, Warren Buffet, who basically, after they had made their fortune, turned their attention to philanthropic endeavors. And this was a very interesting thing to watch, because someone like me who spent my career in the nonprofit sector, you read some literature, 10 or 15 years ago, it was pretty—it was sort of a harsh indictment from these entrepreneurs, thinking that, “Oh, these nonprofit people, these social sector people, they don’t know what they’re doing. We businesspeople will come to the rescue. We’ll come in with our business principles, processes, and systems. We know how to do it.”
There was a lot of hubris involved in the early days when these entrepreneurs decided to start their foundations and their philanthropic endeavors. And I think they wised up pretty quickly and they realized that there were a lot of committed smart people like us who had been devoting our lives to this. And if we could have solved it, we would have solved it.
But to their credit, after they sort of were chastened a bit, they did realize how very difficult this work is and did try to start to break down some of those barriers between the business world and the social sector and to allow some of this cross-fertilization to allow us to work in common cause.
And then I think the last demographic trend that I’ll mention, because it most particularly affects Echoing Green, is this demographic bubble of the millennials, I mean, this 80 million strong demographic behemoth of, you know, folks born in 1980 and beyond, who look at the world in this very interesting way. They’re this really interesting mixture. Are you a millennial, Tony? You’re a millennial. So Tony is a real-world example of this, these young people who have a great deal of personal agency. They really want to have an impact on the world. They really want to make a difference. And they are willing to be held accountable for that. They want to roll up their sleeves and be engaged in it.
But they are also very tethered to notions of parental authority. It’s sort of very different than my generation, which was sort of more activist in its zeal, us versus them, get the man, go after the man. They’re very different. And, like, let’s all sit down together and we all know that we care about our communities. How do we get there together? And I love that about these millennials. And they are really shaking up the way that we think about social innovation and social entrepreneurship.
And I’m sure—I wonder what is going on at Walden. But, you know, currently there are about 61 institutions in 17 countries that have dedicated social entrepreneurship programs already. That number’s going to keep exponentially increasing. And there are many more institutions that have, you know, a lot of campus activity around social entrepreneurship. So this trend is here to stay, mainly because the millennials and others are so enamored by this opportunity to figure out how to get engaged and how to get involved.
So before I talk more about the partnerships, let me just give you a couple of my dead horses about the field. So social entrepreneurship—I talk to young people in conferences all the time, all across the country. I always get invited to sit on these panels on, how do you start a new social change organization? And I stand up and I always start my talk by saying, “I beg of you. I’m pleading. Please don’t start another nonprofit organization.” And everybody’s stunned, because they say, “Well, why did we invite you here? You’re telling us not to do it.”
But the problem is, and these young people, you know, and you give them credit because their heart is in the right place. But they’re starting to conflate success with starting something. That’s absolutely the wrong message. Again, we’ve got too many nonprofits. They’re duplicative. You know, they’re fighting over limited resources. And I guarantee, you know, every young person I talk to, if you just Googled a little bit more, you’re going to find an organization that’s already working on what you’re really interested in.
So, you know, my caveat, my warning to them is, you know, Echoing Green is not in the business of just putting out another new nonprofit or new social enterprise into space. It’s not about that at all. It’s not about the organization. It is about the idea and about the transformative nature of that idea. So I always say, we’re not in the business of funding yet another charter school. That’s not what we’re in the business of. But if you’ve got a new way of thinking about education reform that could fundamentally change the system in which you’re working, then come to Echoing Green.
And I think it’s that kind of nuanced, sophisticated thinking that it is incumbent upon us to really impart in our field. Because again, the message is not more organizations. It’s more hands on deck, working on problems that you really care about.
And because Echoing Green is in the business of the human capital of social entrepreneurship, we spend a lot of time thinking about, well, what does a social entrepreneur look like? What does she have? What makes her different? And we actually spent over a year really thinking about this and trying to codify this. And you guys, you know, Daniel Goleman, [the] Harvard professor who talked about EQ, emotional intelligence, you know, we really, you know, created this framework that we are now calling SEQ. Because we actually think there is a social entrepreneurship quotient or a set of characteristics and qualities that actually do distinguish social entrepreneurs from other social sector actors. And as we’re selecting our class of fellows each year, we think very hard about how to determine which of our applicants have those qualities. And there are nine that we really focus on. And I won’t go through the whole list, but I’ll give you a couple of examples.
So we talk about social entrepreneurs, these particular social change agents, as resource magnets. They’re phenomenal resource magnets. I’ve known Wendy Kopp ever since we were Echoing Green fellows together. She’s not a naturally charismatic person. You can sit in a room with Wendy and you’d walk by her all day.
But she is the most extraordinary resource magnet I have ever met in my life. Because she’s got this incredible ability, because of her passion, zeal, and absolute commitment to Teach For America, that she draws in a host of resources to her cause. Her supporters become evangelists for her. She is able to leverage an extraordinary amount of financial capital from private sector sources, from the government, from foundations. She is a media darling, whether it’s appearing on the cover of Fortune magazine or on The Charlie Rose Show a number of times. She’s able to attract an array of resources to help her cause go farther, faster. That’s a quintessential quality we see in social entrepreneurs.
Another one which comes out of some psychological research is an asset-based world view. And that’s, you know—okay, I know that I could have just said a glass half full view versus a glass half empty view. But they call it an asset-based world view. And, you know, in doing reading on this, you see that evolutionarily, we were designed to look at the world as a scary place. So in the cave, we see the wooly mammoth, oh, scary place, world is dangerous. And so we are physiologically programmed to see danger at every turn.
However, there are some of us who are preternaturally designed to actually flip that switch and to see problems actually as opportunities and interesting challenges. And we see that in our social entrepreneurs all the time. They’re never deterred by a problem. It’s always, “What a cool problem I get to tinker with and try to figure out how to get around it.” So I think that is another really important quality of our social entrepreneurs.
And again, I actually do think that just as for-profit entrepreneurs are rare economic actors, so too do I think social entrepreneurs are rare social sector actors. And that’s okay. It’s just making a point that entrepreneurs, by nature, are risk-tolerant. Most of us are not. And that’s probably a smart thing. But it would be smart of us to realize that you’ve got this particular actor. And then what are your skill sets? What do you bring to the table that can work in concert with these social entrepreneurs to help you all get to a particular solution more quickly together? And I think that’s the message that Echoing Green has really been trying to promulgate that. You know? It’s not all about being the founder or being the CEO. Often more importantly, it’s about being a really smart operations person, being a really great finance director, being an incredible liaison between the nonprofit world and the government.
And I think, you know, again, part of our field’s work ahead is to sort of turn down the dial and the attention on the individual social entrepreneurs, regardless of how inspiring their stories are, and start thinking about not the individual but on the work that they are trying to do. And I will say, you know, what I like about social entrepreneurs—and again, this sort of gets glossed over because people sort of really focus on the business speak and the business language behind it. Make no mistake—at least the social entrepreneurs that Echoing Green fund, they are social movement builders. Each of them never forgets that they are larger, part of a larger social movement, and that they always—if they’re always focused on results and a solution, they realize instinctively they will never get there alone, that it is only in alliance and cooperation and movement building that they will move the needle on that particular issue or problem on which they’re working.
So bringing it back around—so I was supposed to come today and talk about, you know, are the walls between the nonprofit, for-profit, and government sectors crumbling? You know, I would change that question around a little bit. And I would say that it’s not that they’re crumbling; it’s that we’re all thinking about our relationship to one another differently. Because, you know, if you sort of look at how nonprofits relate to government already—like, if you look at direct dollars to nonprofits, plus sort of the tax incentive, the regulatory environment that allows all of us to donate to our charities of choice, literally 60 cents out of every dollar is already coming to nonprofits through the government in one form or another. We already work together. So that’s just a given. So remembering that is important.
But I think what is happening is that you’re starting to get people who are less siloed in their approach. They’re less ideological and sure about what each sector is good at and what each sector can do. And they are less committed to a particular sector, but would rather use every tool at their disposal to get done what they need to get done.
So couple of examples of that—so a couple of Echoing Green alumni, Leslie Crutchfield and Heather McLeod Grant wrote a terrific book which I would encourage you all to read. It’s called Forces for Good: The Six Practices of High-Impact Nonprofits. And these social entrepreneurs essentially took, you know, Jim Collins’ methodology, you know, the author of Built to Last and Good to Great, and said, “What if we used his methodology and applied it to the social sector?”
So they, like, spent three years, did all this research on asking, what makes a great nonprofit great? And I won’t go through the six practices, but a couple things stand out. One of the practices was that great nonprofit organizations make the capital markets work for them. So again, it’s not about saying, the business world is over here, we, you know, do-gooders are over here. Not the calculus at all. It’s that, you know, when you think that most of our economic impetus is coming from the business world, you better think about working with these players in some sort of substantive way.
And the examples that they use in the book, including, you know, groups like City Year, which has been a leader in sort of corporate volunteerism, corporate, you know, public partnerships, they’ve been really, really good at leveraging the corporate marketplace for greater good.
Another, you know, great story in the book, it’s Fred Krupp from NRDC who said, you know, “I spent my life as this activist. And it was always about, you know, sue the bastards, get the bastards.” But then, he took a lot of heat when he decided to start working with the McDonald’s Corporation to reduce their ecological footprint around, you know, packaging for hamburgers and french fries. And he said, “You know, I realize that, you know, I can work with the bastards. You know? If I need to work, I’ll work with them.” And he says, “I’ll use any tool in my tool kit for the appropriate, you know, results.”
And I think sort of again that, you know, cross-sector thinking [is] really, really, really important. So again, a great book. It’s a fun read. I recommend that you take a look at it. Another interesting trend that I would point your attention to is this whole notion of impact investing, so double bottom line investing, triple bottom line investing, so basically for-profit enterprises that are also trying to create social and environmental gains while they’re achieving return on investments.
And it’s very interesting. There was a great report done I think almost a year ago by the Monitor Institute that basically said that this industry of impact investing is really at a tipping point. Like, it sort of moved from this marginal group of activist investors, a lot of folks who invest in CDFIs, CDCs, and it’s actually moving into mainstream traditional investing. And there are some estimates that, in the next—I want to get this right now, because this is big money. You know, if you look at the size of today’s … social investments, so people like Calvert, again, some great CDFIs working there, out in the field, Katherine Fulton and Monitor say that it is plausible that in the next five to 10 years, this field could grow to represent approximately 1 percent of estimated professionally managed global assets.
And I know that proportion seems small, 1 percent. But it’s actually $500 billion dollars. That’s a significant amount of money that absolutely outstrips what sort of traditional philanthropic sources are putting into the social sector. So this notion of impact investing, again, it’s not business. It’s not social sector. It’s sort of an amalgam of all sectors coming together to drive profits, but also social benefits and environmental benefits as well—very important trend.
And some of this, as well, is playing out in the policy arena. So if any of you are sort of following some of this work that is being done around creating new corporate entities, whether they’re B Corporations, L3Cs, this notion that our tax system, our regulatory framework is not keeping up with all of the innovation that’s happening out in the space here, and that you need new corporate entities that, number one, don’t just look at shareholder interests but are actually looking at stakeholder interests. It’s sort of a broader group of constituents that should matter to the corporate entity or sort of the allowances that should be made for entities that are doing double bottom line, triple bottom line deals.
The fact that these sort of policy discussions are happening—and I think 20 or 30 states are now looking at some of these regulatory changes around corporate forms. I think that’s another great indication that, you know, we are thinking about this work differently.
And just from Echoing Green’s perspective, you know, I was an Echoing Green fellow … so it’s hard to believe. 1992, I got an Echoing Green fellowship to start a mobile health unit in inner-city Boston. I was in med school at the time. And, you know, a block away from my classes, black babies were dying at three times the rate of white babies, you know, in my own backyard. It was, like, just crazy. It was just insane. And, you know, it’s that moment where, you know, we all see problems every day, but every once and awhile, there’s that one problem you absolutely can’t look away from. And for me, it was infant mortality and this notion that, you know, babies who look like, you know, my cousins or my friends’ kids, like, they were not getting a chance in life, that that was my, what we call at Echoing Green, my moment of obligation, of where I had to do something.
And Echoing Green fortunately gave me a fellowship to start a mobile health unit called The Family Van that works with communities in inner-city Boston, you know, focused on cultural competency, access-to-care issues. You know, 17 years later, [it] doesn’t seem that cutting-edge or that innovative, but back then, there was not a lot of talk about, how do work with indigenous communities in responsive ways? And I really credit Echoing Green with sort of changing my life.
But it was a traditional nonprofit. All of us back then, we were all starting traditional 501(c)(3)s. But honestly, in the last couple of years, when we look at the fellowship applicants coming through Echoing Green’s business plan competition—you know, we get, like, a thousand applications a year from 60, eighty countries around the world—literally, like, 20 percent of these folks who are applying to us now are now either starting for-profit social enterprises or some hybrid, where they’ve got a nonprofit with a affiliated for-profit entity. That’s just staggering. I mean, that is a real sea change in the way that these next generation social change agents are looking at the world. And I think we ignore that at our peril.
So I think I’m going to stop here and just say that I do think there is this moment. And I recommend a couple of books to you guys. So there’s a great book called Megacommunities. Anybody heard of Megacommunities? It’s, you know, how leaders of government, business, and nonprofits can tackle today’s global challenges together. It was done by a couple of Booz Allen consultants, and it really does look at this notion that individually, each sector cannot do it alone. You collectively have to come together. And how do you create sort of a framework, a new framework for leadership, an alliance structure that will allow the synergies of these three sectors to work well?
And then another terrific book, which I think is equally as important, by Joshua Cooper Ramo called The Age of the Unthinkable: Why the New World Disorder Constantly Surprises Us and What We Can Do About It, which is really about this thinking around complexity that are old ways of thinking about problems, whether from a perspective of diplomacy, social sector—it doesn’t work anymore. Our world is too complex. The way that things are happening across state boundar[ies] and national boundaries, things are different now. We’ve got to think about our complex world order in a fundamentally new way.
And I think these books and others are really symbolic of this potential new age of how the sectors can really work together. And I would posit that, you know, for someone like me who is—I’m going to spend, you know, my whole career in the nonprofit sector. But that’s going to be sort of the old model real soon. People are going to bounce from government to the private sector to the social sector, back and forth, back and forth. And I think that’s actually a good thing, because I think that this sort of cross-fertilization will naturally keep us from being siloed the way that we’ve been siloed in the past. So again, I think I’m going to stop here. And I would love to hear your thoughts, comments, or any questions you have for me. Thanks.
QUESTION: Good morning. My name is Rhonda Brown. Before I get started with my question, I would just like to acknowledge and thank you for the SEED public charter school. I have two nieces that are currently—that are going there. And I’ve also subbed there at that school. And in the event that my colleagues do not know about SEED, it’s a boarding school. So the children are allowed to stay there. They go in on Sunday and they come home on Fridays. And it’s a[n] excellent program. It’s a college-bound program. And I do thank you.
Now my question to you is, lately it appears there’s a social entrepreneurship going on. And looking ahead, what impact do you think this increased attention and a support for social innovation will have? The second part of the question is, are you seeing any changes among your fellows or the projects they’re pursuing?
DR. CHERYL DORSEY: So, thank you for that question, Rhonda. And again, yeah, the SEED school is terrific. And mind you, the social entrepreneurs who founded it, Raj Vinnakota and Eric Adler, perfect example—they were both business consultants at Mercer who, on the weekends, would sit around reading about educational inequity, quit their jobs as well paid consultants, spent a year traveling the country looking at educational inequity, and started the nation’s first urban boarding school. It had been tried many times before. But nobody could get the financing right.
And they were the first to get a private loan from Bank of America to build their state-of-the-art facility over in Anacostia, and also change, you know, local D.C. law to accommodate this new facility. So the innovation is both on the education front and on the financing front.
So first question, what impact do we think we will see? So I’m not going to say much about the government piece of it, because Michele Jolin will be following me. She works at the White House Office of Social Innovation and Civic Participation. I think you’re already seeing the energy and momentum of social innovation trickle up to government. I’m of the belief that government—and I’m sorry if I’m being heretical here—I don’t ever think government leads. I think government follows.
So government is always looking at, “What’s happening on the community level? What are indigenous leaders doing?” Social entrepreneurs have been working really hard for a long time. And the government is starting to catch up with it. And I should mention—and maybe Michele will talk about this—you know, Mrs. Obama’s a social entrepreneur herself. She actually came to the Echoing Green offices 20 years ago and got money to start the Chicago office of Public All[ies]. So she comes by this work honestly.
So to me, the fact that the government is engaging in this conversation is really important. So I hope that Michele will talk about how the government is hoping to do its work differently to make partnerships between social entrepreneurs and the government more effective. So that’s going to be a really important thing to look for.
So I think what impact it’s going to have, I think it’s going to change the conversation on civic engagement and civic participation. I spend all my time working with young people. But let’s not forget, like, the baby boomers, all about to retire with a ton of skills, a ton of expertise, and a ton of time. They are going to be ready to contribute in extraordinary ways. So I think you’re going to have this tidal wave of people who want to give back and move—I know this is a cliché—but move beyond charity to change, and really understanding, if you’ve got sort of a root cause analysis, if you’ve got sort of a systems change approach to this work, with enough people, with enough, you know, sweat equity, we could potentially tackle some of these problems.
So I think you’re going to have a new conversation around civic engagement. That’s one thing. Again, I think you’ll see further partnership between the three sectors, which was, you know, the topic of my talk today. So you’re going to have the opportunity for more resources to be conjoined, so corporate funds, government funds, private sector funds. And I actually think if we can talk in a coordinated fashion, you actually might see a very fragmented social capital marketplace move to a more functional capital marketplace like we see in the for-profit financial sector. So I think some of those things are coming down the pike. And what was the second question, Rhonda? What was I supposed to …?
QUESTION: Are you seeing any changes among your fellows or the projects they’re pursuing?
DR. CHERYL DORSEY: Yeah, okay. Thank you. So again, the notion that more and more of the folks who are applying to us are starting for-profit or hybrid entities. That’s a big change. I would say in the last couple of years, we’ve seen two very interesting trends. A lot of the young people who apply to us are so tech-savvy, I mean, in a way that I never was or will be. But they’re using technology platforms to mobilize communities in a whole new way. If I had an iPhone I would hold up an iPhone. We funded a young man, Jacob Colker, who started something called The Extraordinaries. It’s a new iPhone app. So if you guys, sick of listening to me, you’re in the audience, you could do volunteering from your iPhone. So you could work with a nonprofit organization who would shoot you maybe a document and would ask you to proofread it, or NASA or the Library of Congress could ask you to tag photos or books, all from your iPhone.
So this new use of technology is just groundbreaking. And then the other trend I would say we’re seeing globally is around international development. International development has sort of been top-down, rooftop as opposed to grassroots. A lot of folks that are coming to us are seeing the problems with that kind of top-down approach and are really focused on appropriate technologies and working with indigenous populations to develop bottom-up solutions. So I think some of those—those are some of the trends that are coming across our transom. And, you know, it’s really fascinating to see how community members are responding to what they see.
QUESTION: Hi, I’m Linda Leftrict with Walden University. I, too, am familiar with the SEED school here. It’s a wonderful, wonderful school. And I was wondering, in terms of trends, what are some of the opportunities that you see that are happening in the education space as far as social opportunities, social entrepreneurship opportunities for us to explore?
DR. CHERYL DORSEY: Again, I’m a generalist. I’m not an expert. But about a third of our social entrepreneurs work in the education and youth development space. So we have seen a lot of these entities in our pipeline over the years, so again, early funders of Teach For America, the SEED school, if you know Citizen Schools, an apprenticeship program, the BELL foundation, Heads Up, City on the Hill, one of the first charter schools in Boston.
So I think sort of the workforce development aspect that was sort of—that began with Teach For America, how do you get new resources into the space, I think that’s continuing. I think the biggest thing we’re honestly seeing though is, I tell you, a ton of dollars flowing into the space in these mezzanine level or venture philanthropy funds. So if you know Venture Philanthropy Partners here in D.C., founded by Mario Morino and run by Carol Thompson Cole, if you follow NewSchools Venture Fund, you’ve got these big entities that are aggregating hundreds of millions of dollars to test out innovative new models around education reform. And again, just saw Michele Jolin walk in, and she’ll probably talk about some of the work that the government is trying to emulate around these social innovation funds.
So at the Department of Education, Jim Shelton, formerly of the Gates Foundation, is sitting atop I think a $650 million innovation fund. So I think it’s, you know, how do we aggregate capital and deploy it in a cost-effective, innovative way to address some of these educational inequities? So I continue to be struck about these waves of capital and the way they’re syndicating it, that I think has real possibilities for changing the conversation in the space.
QUESTION: Yes, hello. My name is Anthony Brown, graduate student of Walden University. I was just thinking in terms of, 60 percent or more success rate of your funding, what would you say has been, if there is, any one thing that has enabled the individuals within that 60 percent to succeed?
DR. CHERYL DORSEY: That’s a great question. We think about that a lot. And I’m going to out myself here, because if you had that data in front of you, you would realize that it’s really sort of a proxy measure. So when I say that, you know, 67 percent of our organizations are sustainable, you could ask me, “Well, what does that mean?” You know? If they, you know, file a 990 every year, and even if it’s a struggling, you know, $150,000 per year entity or, you know, $110 million per year entity like Teach For America, that’s still sustainable in our definition.
So you’ve got to, you know, scratch beneath the surface to see what we mean. But nonetheless, they’re still doing the work. So I just wanted to put that, you know, disclaimer out there.
And again, I’m biased because I work at, you know, a part of the social entrepreneurship continuum that’s about the human capital or the human technology of this work. I will bet on a passionate leader any day of the week. You know? At the end of the day, I want someone who gets up every day, who is completely accountable to and responsible for that problem, who has an ability to execute and who will stop at nothing to get there. And that’s what I’ll put my money in, every single day of the week.
Again, it goes back to Jim Collins. If you get the right people on the right bus in the right seat, you can work wonders. And because so much of Echoing Green’s work is about the vetting process and about the due diligence we do to select those individual social entrepreneurs, we just have been very good at picking these winners. And that’s not to say they—you know, a lot of these folks are extraordinarily visionary leaders. They have, you know, their own management issues and others. But at the end of the day, I think you cannot discount the human capital component of this work. I think we just pick the right people who are doing the right work at the right time.
And I will say that we put a real premium on indigenous leadership. And I don't mean you have to be from that community or look like the community that you serve, but you’ve got to be deeply respectful of and work with them. You’re not lending a helping hand; you’re working in concert with those that you serve. And I think that profound respect for the community and their constituents and their customers is fundamental to the way that these folks are approaching their work. So again, I’m biased, but I think the human capital component is everything.
FACILITATOR: We have a question from online. “I am interested in empowering women, especially those in marriages where they are oppressed by husbands using their religious beliefs. How can I, as a recent grad from Walden with a master’s in general psychology, open a business and produc[e] social change in this area? I have experience as a psychologist but am not an entrepreneur.”
DR. CHERYL DORSEY: Very interesting question. So I think this is a great example that, as I said earlier, you don’t have to be a social entrepreneur running your own shop to be successful in this space. But I will say, it sounds like the person who asked the question is just at the beginning of her journey. And I would say one thing—social entrepreneurs are some of the best experts I have ever seen in their issue area. It is so endemic to their DNA. It’s a part of every sentence they speak, every thought that is in their head. You go to a dinner party with a social entrepreneur, you’re going to talk about nothing else but their work. I’m warning you—that’s what the dinner conversation is going to be about.
And it’s not about your academic pedigree. So for example, we funded a terrific gentleman, Mr. John Thompson. Mr. Thompson spent 18 years in Angola on death row for a crime he didn’t commit. Twice, he came within 29 days of being executed. Fortunately, because of the Innocence Project, he was released four years ago. He now runs a model reentry program in New Orleans called Resurrection After Exoneration.
Mr. Thompson didn’t complete high school. But if I ever have a question about reentry work in this country, I’m calling John first. He knows this work cold. He lives it. He breathes it. He understands every nuance. He’s thinking two steps ahead of the field before the field has figured out what corner it’s about to go around. And they just get it. They just really understand it.
So I would tell the questioner, know your issue cold. And that could mean, you know, doing some additional academic research. Because sometimes that’s helpful. Go in to work for an existing organization that is in that space or that is tangential to that space, working with the community you want to serve to understand its voice and what’s happening on the ground. And I think experiential learning cannot be understated. It cannot be understated in doing this kind of work. And it may take you a year to figure it out. It may take you five years. Could take you 10 years. But the journey is really important. So I think that’s what I’d offer.
QUESTION: Cheryl, good to see you again. My name is Ashok Regmi from International Youth Foundation. And we run youth social entrepreneurship in multiple countries in partnership with Laureate International Universities Network, which Walden is a part of the network. And two questions Cheryl—one of the challenges we have faced is with tension in managing the individual, the role of individual in this idea, and the collective entrepreneurship. And how do you maneuver in that situation?
And second is, in the word itself, social entrepreneur, does your program focus more on the entrepreneur side of the equation? And if yes, is earned income revenue strategy an indicator of you selecting your fellows, or more focuses around the social aspect and the vision that the social entrepreneur brings to the table?
DR. CHERYL DORSEY: Great. Good to see you. I’m a big fan of International Youth Foundation, IYF. A number of your colleagues have participated in our vetting process over the years. Esther Benjamin, who you know well, who used to be a member of your team, is a board member who actually, along with Aaron Williams, now is at the U.S. Peace Corps. So again, a big fan of your work.
So a couple questions—so I would say one of the Achilles’ heels of our field is this notion of the individual. So if you Google “social entrepreneur,” it’s all these interesting stories about these very cool individuals who are raised up like heroes. And it’s sort of this, you know, hagiography. You know, “The individual’s out there alone. Look what they did.” And that’s the wrong narrative. You know? If it takes a village to raise a child, it takes a couple of villages to raise a social entrepreneur. They never do this alone. It’s easy for the media to paint it that way, because that’s a more interesting story. But a real social entrepreneur will really present himself or herself as a part of a collective. Because it’s never about the individual. Because again, most social entrepreneurs approach their work in the context of social movement building.
And again, an individual narrative and an individual trajectory is just not going to get the work done. So I would say the social entrepreneurs that I’ve always worked with, the individual matters, because that’s how we all interact. The stories are important. It inspires us. It motivates us. But it is the collective and communitarian aspect of their value system that is most important.
So again, I think there’s this tension between the way that the media portrays social entrepreneurs and the way they actually walk through the world. And it’s something that we have to be very careful about. But again, I think a real-deal social entrepreneur, it is not about him. It is not about her. It is about the work. So I think that’s the first thing.
And again, you know, earned income, how do we think about the folks that we fund, when you look at the different social entrepreneurship organizations out there, relative to the others, we very much take a social justice approach to social entrepreneurship. So for us, the individual is paramount. Because like I said, we invest in individuals. And there has to be, you know, a root cause analysis to the work that you’re doing, whether you’re a 501(c)(3) or you’re a for-profit entity. And you’ve got to be contextualized within a larger social movement. Because if you’re really trying to move the needle on some of these problems, your one little island of excellence, your one little organization is never going to do it alone. But that is our particular brand of social entrepreneurship. There are other brands, but that’s just our approach to the work.
FACILITATOR: I have an online question. “My name is Mohamed. I am in Senegal, where I’ve spent over a decade working with small farmers on enhancing farm production and agricultural incomes. What is the experience of Echoing Green with agricultural enterprises that combine a for-profit component with what I call nonprofit activities?”
DR. CHERYL DORSEY: That is a great question. That’s great work. I think that there’s really important work going on in Africa in particular around sort of agricultural yield.
So a couple years ago, we funded an extraordinary social entrepreneur named Andrew Youn, kid, you know, first-generation American, was a social justice activist in college, went off to business school at Kellogg and went to work for a business consulting firm, and I guess was taking some time off and was traveling through Africa one day, was walking through a rural village. And he said, you know, “I met this family. They invited me in. They had very little to eat. But what they had, they shared with me.” And he said, you know, “I stayed with them. Rain was coming down on the thatched roof of their home.” And he said, you know—this is an Asian American kid from Milwaukee. And he says, you know, “At that moment, I knew I was home.”
So this kid quit his job at the consulting firm and said, you know, “I couldn’t get out of my head that the hungriest people in Africa are farmers,” like, how counterintuitive is that? And he talks about the hungry season, where for months of the year, these families are starving, to the point that rates of child malnutrition and child death are really significant variables in the lives of these farmers.
So he has created something called the One Acre Fund that bundles agricultural technical assistance, you know, better seeds, better fertilizer, combined with microcredit, so financial instruments to allow farmers to buy their inputs, and then finally, access to markets. So once you grow the stuff, you’ve got to get it to market to sell it.
In just over a year, One Acre Fund and the farmers with whom he works, they’ve quadrupled crop outcomes. And we actually just got an email from him the other day. And he said, you know, for the first time in working with these families, it is the middle of the hungry season, and these families are not hungry. They’ve got grain, you know, that they’[ve] stored, ready to get to market. And I think it is a great example, again, across sector. Let’s get, you know, financial instruments like microcredit at the ready. Let’s get good technical assistance from a variety of farmers. And remember the power of the capital markets to generate revenue.
And it’s a wonderful strategy to move beyond, you know, poverty reduction to actual revenue generation. So this is one of many profound examples of how social entrepreneurs are leveraging markets and working collectively to stamp out, you know, something that just simply shouldn’t exist.
JONATHAN KAPLAN: Thank you, Dr. Dorsey. I don't know about all of you, but I feel a lot smarter than I was just 60 minutes ago. And I think part of being part of a university is that through not just our courses and programs but events like this, we have the opportunity to learn and, in the best of the Walden spirit, to apply what we’re learning so as to have a significant impact beyond us.
I also want to say just how inspired I was by Dr. Dorsey’s remarks. And I was observing as she was speaking how there’s such an absence of cynicism among social entrepreneurs, that there’s a sincerity and an inspiration behind everything they’re doing. And I was trying to think of why there’s not a grain of cynicism. And I think it’s because you all just don’t have the time. I think there’s so much going on with respect to starting organizations and supporting them and supporting the human resources that are needed that there just isn’t the time for it. And I think that’s a great lesson for all of us.