Part 2: North Star Tours and Safaris
In Part 1 of Inspirational Tid-Bits, we discussed social businesses. We explained the definition by Muhammad Yunus and we explained what their role would be in the current markets. As we have mentioned before, BCC is expanding cooperatives and working to develop social businesses. We have been working with our safari friend, Jesse, and Rich Carman, and Jesse has decided to begin a safari social business company that will benefit BCC.
Here is the general concept. Jesse has started a company called North Star Tours and Safaris (www.northstartoursandsafaris.com). The company is seeking international investors who will support Jesse with an investment. Unlike other investments, this investment is more of a loan. Think of it like a donation that will be paid back to the lender. The investors receive no interest. They receive their initial money back and they maintain general ownership of North Star Tours and Safaris. They will be included in business decisions, like normal investors, but their shares are sold back to North Star Tours and Safaris over time. No profit will be made on the transactions.
The investments will go toward the start up costs for North Star Tours and Safaris. Jesse will be the sole owner and proprietor. Once the business is officially started in January 2012, Jesse will be responsible for running the business, guiding the tours, and giving a brief introduction to BCC. Jesse will have a salary through North Star Tours and Safaris and business expenses will be paid by North Star Tours and Safaris, not by Jesse directly. Jesse will not keep any profits generated by North Star Tours and Safaris. 100 percent of the profits generated will be donated to Building a Caring Community. 100%!!!
Jesse will explain BCC and the importance of advocating for children with disabilities and their families to individuals who take Jesse’s safaris. If they agree, he will take them by the cooperatives and show them the products that BCC social businesses create. BCC is hoping that this will increase the awareness of their program, increase financial support for the caregivers of the children who receive services from BCC, and, of course, increase the sustainability of BCC through profit donations.
This is not a one-way relationship; BCC will also work to assist Jesse. Hundreds of people volunteer with BCC each year. BCC will advertise for North Star Tours and Safaris in its volunteer orientation, brochures, and events in which BCC participates. Individuals may be more interested in taking a safari with North Star Tours and Safaris because it is a social business supporting a cause they believe in. Also, as mentioned before, Jesse will not incur initial start-up expenses because of the investors who are interested in supporting North Star Tours and Safaris and BCC.
As you can see, there is a potentially powerful relationship that is being created with this social business. North Star Tours and Safaris will benefit by being a social business and BCC will benefit from having the support of a social business. It also benefits society because money generated from the Tanzanian tourist industry will benefit a social cause. Average citizens, both Tanzanian and international, will be able to support the social cause with a simple decision of what company to hire for their vacation.
Of course, charity towards a business that assists a social cause is not the only reason to choose North Star Tours and Safaris. As we mentioned last week, the goal of a social business is to compete with for-profit businesses. Charity alone does not make a social business work. Jesse is an educated, trained, and experienced safari and travel guide. His business will look, function, and perform just like any for-profit safari company. The only difference is that 100 percent of the profit generated will go toward a social cause instead of Jesse, investors, or wealthy international entrepreneurs.
The definition of social business has been derived through Muhammad Yunus’ extensive experience. He worked to make microcredit financing a global idea and he has helped millions of people escape extreme poverty. In his book Creating a World without Poverty: Social Businesses and the Future of Capitalism, he sums up his experiences and the niche for social businesses. “Three decades back, I began with a small problem in a small village. I was shocked by the harshness of the problem of money lending, but I was excited by the simplicity of the solution … I believe that social business has the potential to lift the struggle to eliminate poverty to a new level. Social business can be a very powerful format for the private sector, public sector, philanthropists, donors, NGOs [Non-Governmental Organizations], faith groups, or anybody else.”
With the example of North Star Tours and Safaris, it is easy to see how a social business runs. It is also simple to see how it can benefit the business owner, social cause that the social business supports, and the greater community. Ultimately, this simple and positive business relationship will directly benefit people in need. This concept does not only work in the developing world; it works in the developed world as well. There is a huge need for social businesses everywhere. The only thing that is missing at this point is innovative individuals, such as Jesse, who see the potential benefits for the company, the social cause, and the global community.