CONCLUSION
RECALL FOR A MOMENT the inspiration for our title: “The reasonable man adapts himself to the world,” George Bernard Shaw said, whereas “the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”1 We have spotlighted an array of people who were— and, in many cases, still are—dubbed “unreasonable.” One reason they are considered unreasonable is that the rest of us find it difficult to see radical disruptions coming, whether those disruptions promise breakthrough or could create an economic, social, or environmental breakdown.
Let’s take just one example. In The Long Emergency, James Howard Kunstler warns of dire outcomes for societies that are overly dependent on the dwindling supplies of easily accessible oil.2For instance, he predicts the end—indeed, the collapse—of American suburbia as energy prices soar in the post-peak-oil era. “We have invested all our wealth in a living arrangement with no future,” he argues. “In building suburbia, we embarked on the greatest misallocation of wealth in the history of the world.” Instead of ghost towns, expect ghost suburbs and exurbs.
Unreasonable? On most current assumptions, yes, but many social entrepreneurs have seen with their own eyes what happens when governance, economic, social, or ecological systems break down. Many of the entrepreneurs in this book—among them, Fazle Abed of BRAC, Bunker Roy of Barefoot College, Muhammad Yunus of the Grameen Group, Andrea and Barry Coleman of Riders for Health—had their epiphanies when confronted by brute catastrophe.
The CIA has predicted that environmental pressures will exacerbate global tensions and increase the risks of conflict in the coming decade.3 Social and environmental entrepreneurs, however, believe that such a tide can be diverted—and even turned. Take the desperate plight of the world’s coral reef ecosystems and marine fisheries—and the work of the Marine Stewardship Council (MSC). An independent, global hybrid nonprofit organization based in London, the MSC aims to reverse the decline in the world’s fisheries. It seeks to harness consumer purchasing power to generate change and promote environmentally responsible stewardship of the world’s most important renewable food source.
How does the MSC plan to accomplish this? It has developed an environmental standard for well-managed, sustainable fisheries. Like other certification bodies, it uses a product label to reward good practice. The MSC was first established by Unilever (at the time, the world’s largest buyer of seafood) and WWF in 1997 and has been operating independently since 1999. WWF’s involvement was itself an indication of the way in which the NGO world has been developing innovative partnerships with leading companies to mutate markets. The MSC has succeeded in bringing together a broad coalition of supporters from over a hundred organizations in more than twenty countries. CEO Rupert Howes notes that convincing retailers like Wal-Mart of the need to specify, stock, and promote sustainable fish has been a major shot in the arm for the MSC and the agenda it champions.
In the end, however, even such powerful partnerships will not save the world’s fisheries, let alone its oceanic ecosystems. For that to happen, it needs effective global governance mechanisms and sustained political will.
How to Build the Power
We conclude with some guidance on what others can do to help support the work of these game changers, change makers, and social and environmental entrepreneurs. We also offer a number of takeaways for tomorrow’s leaders.
Focus on Scalable, Entrepreneurial Solutions
The time has come to refocus on creativity, innovation, and scale— all aspects of entrepreneurial solutions to the great challenges of the future. Happily, the potential for breakthrough solutions is considerable and growing. It’s true that such entrepreneurship is not a new phenomenon, but its building momentum offers one of the most hopeful signals that we may achieve something like sustainable development in this century.
Tackle Apparently Insoluble Problems
It takes courage to attempt the apparently impossible, but throughout history, the great innovators and entrepreneurs—like those profiled here—have embraced such challenges. As we’ve asserted throughout this book, there are lessons to be learned in how these people see the future, how they connect the dots to solve seemingly insoluble problems, how they often dive in without thinking about how to make a profit from their enterprise, how they try to measure the immeasurable, and how they work to change political, governance, social, and economic systems to combat wider dysfunctions.
Be Prepared to Fail—but Learn from the Failures
No matter how unreasonable, visionary, pragmatic, and lucky an entrepreneur might be, shaping and carrying out a transformational initiative is the result of trial and error. Almost no one gets it right the first time. Entrepreneurs who dream big must be prepared for setbacks, even of the fall-flat-on-their-face variety. Unfortunately, some societies punish failures more than others; such cultures are more risk averse and less entrepreneurial. Independent of the cultural context in which they occur, all failures bruise egos. Still, they can be invaluable inputs to future success. The most important thing is to regroup and head toward the goal.
Experiment with New Business Models
Despite their prominence in the management literature, business model innovations can be hard to achieve. For one thing, it’s tough to think of alternatives to the status quo. That’s why tomorrow’s leaders should explore what social and environmental entrepreneurs are doing—and attempting.
More than anything else, successful social and environmental entrepreneurs demonstrate the urgent need to be pragmatic when facing huge challenges, adopting nonprofit, for-profit, or hybrid business models to suit the context. Our chapter 1 discussion of the three main models used by leading entrepreneurs underscores the fact that all those models create multiple forms of value, whether or not today’s markets reward them for doing so. We have spotlighted many model 1 (leveraged nonprofit ventures) enterprises, noting that model 2 (hybrid nonprofit ventures) is where the most interesting efforts are focused. In the long run, however, model 3 (social business ventures) offers the greatest opportunity for scaling and replication.
Close the Pay Gap
Everyday it seems as if we learn of a different gap between the haves and have-nots. But one gap that rarely makes headlines—the salary gap between commercial and social enterprises—remains the elephant in the room, curtailing the capacity of model 1, 2, and 3 social ventures to achieve long-term success and viability. Why the disinterest in this particular gap? Perhaps because it is considered to be a matter of individual career choice. The truth, however, is that social entrepreneurship will only succeed if the relevant enterprises have quality employees. Talented individuals of all ages may seek to dedicate themselves to organizations that are “fundamentally innovative, morally compelling and philosophically positive.” That goal, however, should not come at the sacrifice of earning a decent salary.4
Currently, even the most successful social ventures struggle to attract and keep top talent, and that difficulty threatens every aspect of these organizations’ ability to grow and have a wider impact. While the motivation to join a social enterprise is rarely (if ever) financial, investors—including individuals, foundations, and corporations—can have a huge impact on leveling the playing field by creating compensatory salary mechanisms that bring social venture remuneration on par with market rates.
Join Forces
Whatever their rhetoric about changing the world, these entrepreneurs know that they cannot succeed on their own. Even if they scaled at the rate that businesses like Amazon, eBay, or Google managed, most would still make only a small dent in the overall problems they are trying to address. As we saw with the MSC, they need partners that are able to do the heavy lifting.
Money remains the key headache for most of these people, whether their enterprises are nonprofit or for-profit. Typically, these entrepreneurs did not pick particular challenges because they were likely (or unlikely) to be profitable but because they represent market failures. Chapter 2 spotlighted a number of routes to money and other resources that these people take, but a huge wave of financial innovation is needed to help the emerging entrepreneurial solutions achieve their social and market potential.
Seed Tomorrow’s Markets
If the needs of 7 billion to 10 billion people are to be met effectively, equitably, and sustainably, vast new markets will need to be created, financed, and regulated. Chapter 3 explored the great divides that stop this from happening today and may offer new prospects for tomorrow. Given the role of experimentation in finding long-term solutions, social and environmental entrepreneurs can make a critical contribution by testing out new models and technologies in relatively low-risk ways—in the process, helping seed tomorrow’s markets.
Feed Growing Expectations
Nobelist Muhammad Yunus put it well when he spoke of “bonsai people”—and of the need to create new opportunity spaces for billions of people around the world. Chapter 4 investigated some of the market failures that keep billions of people from achieving their full potential. A key requirement in correcting such failures is to help people believe that a better world is possible. Access, price, and quality are among the dimensions leading entrepreneurs address in tackling that challenge, but they need help from many other sectors of society.
One potential source of longer-term support is business retirees—including Sweden’s controversial Percy Barnevik, who by 2007 had invested around $14 million in Hand in Hand, which uses microfinance to support entrepreneurs in India. Within five years, he aims to create 1.3 million jobs and 250,000 businesses in the state of Tamil Nadu alone.5 His five-pillar model, with which he hopes to create 50 million jobs worldwide over the next decade, is based on mobilizing illiterate women, eliminating child labor, improving water and waste management, and equipping citizens with the basic tools of democracy.
Help Democratize Technology
Technology’s role is often overestimated in the short term, but it can be decisive in the long term. The principles of the open source movement can help align technology with the values and priorities of wider civil society. As the saying goes, “Nobody is as smart as everybody.”6 So let people in. Chapter 5 focused on efforts to democratize four clusters of entrepreneurial work, from basic building blocks like bricks to the tools of biotechnology. Each of these areas both benefits from and extends the reach of the open source approach.
Work to Change the System
Although public and private sector leaders alike will probably argue that changing the system is the realm of folk like Marx and Lenin, the fact is that social and environmental entrepreneurs’ work casts a hard light on the current economic system’s dysfunctions. Chapter 6 showed that the truly powerful unreasonable people are unwilling to settle for palliative half measures. Instead, time and again, they push for systemic change in the institutions that shape markets—and for solutions that will scale and become sustainable and equitable.
Figure Out How to Scale and Replicate
Even the perfect solution to a great global—or local—problem will create little or no value unless it can be scaled and replicated in good time and at reasonable cost. Some of our entrepreneurs already understand this element of the equation, and others need to learn it, as discussed in chapter 7. Scalability is one reason why so many of these people are keen to build partnerships with mainstream businesses and financial institutions. The role of governments is crucial here, too: Bill Dunster’s zero-carbon architecture at Britain’s BedZed ecohousing development is a great example.7 BedZed is the country’s largest green housing project, offering just eighty-two housing units; its biggest impact, however, may be that it inspired British prime minister Gordon Brown to announce five new ecotowns, with a hundred thousand ecohomes, designed along similar lines.
Within Reason, Cultivate the Art of Being Unreasonable
Unreasonable entrepreneurs may be hard acts to follow, but their perspectives on tomorrow’s social needs, market opportunities, business models, and leadership styles are important in both the public and private sectors, as well as to all citizens who value the earth’s natural, social, and financial resources. As a minimum, leaders in the public, private, and citizen sectors should visit some of their own country’s leading social entrepreneurs, with a view to seeing how they can help leverage change and to learn how to reboot their own thinking and behaviors. How about inviting leading social and environmental entrepreneurs into your strategic conversations with key external stakeholders and even onto your board?
How Can Others Help?
Opening up existing institutions and power centers to entrepreneurs is important, but it won’t scale at the rates that the great social and environmental divides demand. To get a better grip on the sort of support the entrepreneurs themselves thought would be needed, we carried out an electronic survey of several hundred leading social entrepreneurs and those who are trying to help them from the realms of government, business, and finance. We uncovered several ways that others can support the entrepreneurs’ work:8
- Government, in all its forms, attracted the highest score for its support and potential impact. Only rarely do social entrepreneurs go directly into politics and government (exceptions include Kenya’s Wangari Maathai and France’s Bernard Kouchner, who cofounded Médecins Sans Frontières and was appointed by President Nicolas Sarkozy as foreign minister). Elsewhere, they must rely on politicians and government officials. So what do they want these people to do? Among the actions respondents called for are improved tax incentives for social entrepreneurship, innovative financial instruments to encourage banks and pension funds to get involved, stronger property rights, simplified regulation, and incentives to encourage public sector employees to remove barriers to innovation and entrepreneurship.
- Bilateral and multilateral institutions have key roles to play in increasing transparency, stimulating entrepreneurial cultures, raising awareness of social entrepreneurship, expanding the use of public-private partnerships, and supporting the necessary expert studies.
- Business and financial institutions should redefine their corporate giving to include not just money but also access to crucial strategic, technical, and managerial assets and skills. They also need to wake up to entrepreneurs’ potential as a source of market intelligence, on-the-ground experience, and novel hybrid business models. Business and financial institutions need to be financially innovative and boost the flow of capital available through community development institutions, funds of funds, social venture funds, the creative use of secondary markets, and tax-exempt bonds. In other cases, strategic partnerships will be key, like the one that Solarcentury has formed with Sony to manufacture solar electric roof tiles in Wales. Solarcentury expects to make $8 million worth of tiles in 2007–2008, a figure it hopes to jump to $140 million by 2011–2012, which is where the Sony deal will be mission-critical.
- Free of some of the tyrannies of the voting booth and the bottom line, foundations and other philanthropic institutions can be crucial sources not just of funding but also of disciplined innovation, the ability to spot and groom talent, and patient persistence as entrepreneurs experiment and, often, fail. Respondents encouraged these funders to offer patience, persistence, and consistency in their support. Survey responders also invited these institutions to standardize and simplify the various reporting requirements they impose on those they support. Foundations and other funders should also foster systemic change by helping reform social capital markets.
- Educational institutions are vital for the long-term success of communities, countries, and the global economy. While not everyone is cut out to be an entrepreneur, educational institutions can teach the skills that propel world-class entrepreneurs. They therefore need to cultivate entrepreneurial thinking, promote interdisciplinary programs, provide internships and other opportunities to expose young people to the world of entrepreneurship, stimulate the formation of national and global networks, contribute research to the field, and support young entrepreneurs with awards.
How Can Entrepreneurs Help Themselves and Each Other?
In the same survey, we asked entrepreneurs what they themselves can do to increase their chances of success. In reverse order of importance, from least to most important, here are their replies.
First, they felt that they could do more to increase solidarity and mentoring in their own community and work with networks and intermediaries. Second, they acknowledged that they need to do more to ensure smooth and effective successions when they move to new ventures. Third, they recognized that they can do much more to help frame the challenges and opportunities for others and explain how they can help. Fourth, they stressed the growing importance of building effective strategic alliances and partnerships with the public, private, and civil society sectors. Fifth, they noted that their organizations needed to embrace proper governance structures, accountability, transparency, and human resource development. And sixth, which was equally ranked with the fifth point, they stressed the fundamental need to change other people’s mind-sets and thinking on the timetables for progress.
We hope The Power of Unreasonable People will help entrepreneurs’ voices, thinking, and achievements reach a wider—and new—audience. These people exhibit a rare genius, at least as Arthur Schopenhauer defined it. “Talent hits a target no-one else can hit,” he noted, but “genius hits a target no-one else can see.” This skill will become more critical as we move deeper into the twenty-first century. As the challenges grow, it may be unreasonable to remain optimistic about the long-term prospects, but the work of the innovators and entrepreneurs profiled in these pages encourages us to embrace the notion that could be their motto: the impossible takes a little longer.