Innovations and social business

I have been reading up a bit on Dr. Yunus' work. He writes and talks about "social business" and "non-loss" as a missing piece of business. Only focusing on profit maximization creates one-dimensional people and organizations, he says, and I fully agree with him.

"Many of the problems in the world remain unresolved because we continue to interpret capitalism too narrowly. In this narrow interpretation we create a one-dimensional human being to play the role of entrepreneur. We insulate him from other dimensions of life, such as, religious, emotional, political dimensions. He is dedicated to one mission in his business life ---- to maximize profit."
Social Business Entrepreneurs Are the Solution, Dr. Muhammad Yunus

While reading this I came to think of another thing. A while back I was at a lecture by Curtis R. Carlson, President and CEO SRI International, where he talked about innovation being the next competitive edge for businesses (the first two being cost and quality). This creates a situation where every company should/will have a "labs"-department to which employees can bring their innovations and get what they need to realize them (if they pass screening, that is). This is what Way Group has done by creating Waylabs. What happens if the innovation, like in my case, is non-profit innovation or social innovation?

If a profitable company invests money in innovations, they expect the successful once (about 8/10 fail miserably) to be moneymakers. This fits perfectly with the profit maximization-model, but if the innovation will make the world better rather then generate money, what then? I see that there are two options here:

1. The company gives/donates money to the project without anything to show for it but their involvement. This generates positive publicity, which works well with profit maximization.

2. The company decides on a "non-loss" strategy and loans the money to the project. This may not be as noble, but the risk is still about 8/10 that the project fails so the nobility is still significant. This also generates positive publicity, and works even better with profit maximization since the investment hopefully is returned.

Why not just give the money if the company wants to do good? Well, the next time someone comes up with a non-profit project the cost is equally high. This will create a situation where the company wont go for some projects since they have already given money to others (read this article on a similar subject). With the non-loss strategy the company can have a dedicated amount of money that goes in and out of these projects over time. But what if 8/10 non-profit projects fails? When it comes to profitable innovations, the once that succeed pays of in multitude for the once that doesn't. The non-profit innovations could follow the same principals; they share a collective responsibility to regenerate the non-loss investments that the company has put in. This means that the 2/10 projects that succeed will pay back all losses made on failed non-profit projects.

I think that this model has another effect as well. It ensures a healthy economic strategy for the do-good projects. When a project is released it has to, according to me, be self reliant. If the project relies on charity, once that charity stops coming the project sinks. With this model, the project will only see the light of day if there is a financial model that can support the project as well as pay back the investment made in it.

The project I work on will be self reliant. This means that if anyone would like to make a non-loss investment in it, just give me a call or send me a mail and I'll tell you all about what it is we want to do and how we intend to do it!

Fantastic news!

Yesterday Mats Weidmar contacted me and said that Dr. Muhammad Yunus (awarded the 2006 Nobel Peace Prize) has accepted to talk to us! From what I know, Mats has sent Dr. Yunus' staff a presentation and a short paper describing our innovation and based on that he has granted us a 30 minute phone meeting. If that's not a breakthrough I don't know what is...

The next 5000 days

I just saw a video from December 2007 of Kevin Kelly where he talks about the Web being only 5000 days old and what he thinks will happen in the next 5000 days. There are a lot of things you might know or see, but his way on looking at it is interesting. Take a look at the video and let me know what you think.

Kevin Kelly: Predicting the next 5,000 days of the web

I think that if you are starting up a web based project today, you have to take into account the things he is talking about; semantic web, ubiquitousness, sharing of information and so on.
If you don't at least think of these things, I believe the odds are against you.

Google and Gapminder

What does it mean when a foundation owns a piece of software or an innovation? Since we´re in the process of starting a foundation for my innovation I wanted to look into this, and I came to think of the Gapminder Foundation.

Gapminder is a foundation that was started by Professor Hans Rosling at Karolinska Institute in Stockholm. Prof. Rosling has an incredible understanding of the statistics that describes counties development over time and Gapminder developed a software that visualized these statistics in a way that anyone can understand it.

To my knowledge, Prof. Rosling's major public break-though came when he talked at TED 2006 and presented "the best stats you've ever seen" in a fantastically enthusiastic and engaging way. What did this result in? Google bought the Gapminder software for an undisclosed sum of money...

Is that what we want? No. My innovation is a non-profit project with the aim of changing the world for the better, and that is not something we want to sell for personal profit. Why did Prof. Rosling do it then? Well, he didn't really...

"It is a charity that has sold the programme so I haven't had any money." says Hans Rosling.

The Gapminder Foundations statues says that "Gapminder is a non-profit venture promoting sustainable global development and achievement of the United Nations Millennium Development Goals by increased use and understanding of statistics and other information about social, economic and environmental development at local, national and global levels.". Selling their software to Google enables them to work towards their goal, and should in no way discredit neither the Gapminder Foundation nor Prof. Rosling.

In my case, I do not see a potential sale of my innovation but there will always be people that are suspisious of charity. I think that the Gapminder case shows that if the innovation is owned by a foundation it is hard for anyone to doubt the sensarity of our attempt to change the world.

Dr. Yunus

One thing that has happened during the last couple of weeks is that Mats Wiedmar,  a college of mine and the CEO of Dotway, was at a Microsoft conference. The keynote speaker there was Dr. Muhammad Yunus, the Nobel Peace Prize winner 2006, and the fantastic thing is that Mats actually got the opportunity to send Dr. Yunus a presentation of our project. It will be extremely interesting to hear what Dr. Yunus has to say about what it is we want to create. Big thanks to Mats for making this possible! 

I'm back

Well, it was quite a while since my last blog post and I've been a bit ashamed for that. My biggest fear is that I've scared away readers due to inactivity. I'll see If I can't do anything about that the coming days.

What is the status of the project, you're asking? To mention a few things I have

... had a coupe of days of semi-vacation,  meaning that I've tried only to answer mails and maintain contacts in need of maintenance. 

... applied to the Pop!Tech Social Innovations Fellows Program, and I've been told that I'll get an answer this week. 

... sent my presentation to TED and "applied" for a three-minute talk (I don't remember if I mentioned this before, but Rafe recommended me to talk at TED which was pretty flattering) and gotten great response from them. In September I'l know if I'll get up on stage or not at TED.

... formalized how the innovation should be handled from a foundation/company point of view, and I've registered domains matching these thoughts.

I'll try and summarize a couple of things later on in the blog, but right now I have to get some stuff out of my head and down on paper.

Changing blog strategy

I'm changing my blog strategy and moving the blog to Blogger instead of blogging in straight up HTML at www.java.nu. I mean, I want people to follow what I'm writing, and I don't expect anyone to visit my site daily to check for updates or posts. And since I couldn't include RSS in my previous tool, I'm changing tool to Blogger. Hope you enjoy and that it is easier to follow my work this way.