Archives For Conscious Capitalism

 

Note: I wrote this story for the Jamie Kirk Hahn Foundation. It was originally published on December 17, 2014 on JKHF’s Medium.com page.

Photo Credit: Jamie Kirk Hahn Foundation

 

I. A Fight to Ignore

On a June morning this summer, a small group was working on a 16-by-16 plot of urban farm land in Southeast Raleigh when a fight broke out. Across the street two women were arguing over a cellphone. Shouting ensued, onlookers gathered, and the women began assaulting each other. The crowd grew, urging the fight on rather than breaking it up.

Akiba Byrd, a civic activist and entrepreneur, was supervising three youth and an intern on the farm that morning. He had been recently introduced to Nation Hahn, co-founder of the Jamie Kirk Hahn Foundation, who came to work with them on the project for the day. They watched intermittently as the fight persisted for what each says must have been half an hour. Nation mentions being disturbed and distracted by what he saw. It was so unfamiliar, and he couldn’t help but keep glancing up at it.

But each time he looked back at the youth on the farm, they remained heads down, completely absorbed in their work. They weren’t at all interested in the commotion across the street. For them, it was all too familiar.

As the fight raged, two little boys wandered up. They were holding ice cream cones. Rather than join the raucous, they wanted to know what all these big kids were doing. Why were they digging in the dirt? Farming was for the country, could they really do this in the city? Could they really do this in their neighborhood?

“They were completely fixated on this garden, this small garden,” Nation would tell me later, fascinated by the reaction.  “And it was like they were entirely oblivious to this loud and violent fight just across the street. They just stood there eating ice cream and asking questions about the garden.” Continue Reading…

I. An Image Problem: Hercules & The Hydra

Hercules was a real jerk. That’s my conclusion after thumbing through the tales of his conquests last night in Edith Hamilton’s Mythology. He’s lionized as the favorite Greek hero, but this dude had a serious case of roid rage, perhaps the first in all of literature.

To illustrate: his most famous adventures come from the “Labors of Hercules” in which he choked-out the fierce lion of Lemea, diverted two great rivers to clear years of accumulated animal filth in the Augean stables, and killed the many-headed Hydra of Lerna, a creature considered immortal until it met Hercules. But why was he checking all these chores off a list? They were part of history’s first 12-step recovery program, penance for a roid-rage fit in which Hercules murdered his wife and three sons. That backstory was conveniently missing from Disney’s cartoon movie. Seriously, we need to reconsider our heroes.

Hercules v. Hydra, Photo Credit:  Eagle Painter Wolfgang Sauber, Creative Commons License

Hercules v. Hydra, Photo Credit:
Eagle Painter Wolfgang Sauber, Creative Commons License

Here’s Hamilton’s description of the Hydra conquest:

The second labor was to go to Lerna and kill a creature with nine heads called the Hydra which lived in a swamp there. This was exceedingly hard to do, because one of the heads was immortal and the others almost as bad, inasmuch as when Hercules chopped one off, two grew up instead. However, he was helped by his nephew Iolaus who brought him a burning brand with which he seared the neck as he cut each head off so it could not sprout again. When all had been chopped off he disposed of the one that was immortal by burying it securely under a great rock.

Let’s refocus this tale from Hercules to the Hydra. Despite its evil reputation, I want to reimagine the creature in a more pleasant light. That ability to grow two heads where one is lopped off has been the source of nightmares, but I want to strip it of fear and turn it into a constructive metaphor for something we should want more of in our local economies. I’ll call them Hydra economies. Continue Reading…

Last February I got to hear John Mackey give a speech about a better way of doing business. He’s a founder and co-CEO of Whole Foods, and he stopped in at a Raleigh Chamber of Commerce event to promote his book, Conscious Capitalism: Liberating the Heroic Spirit of Business.

John Mackey, Whole Foods CEO Photo Source: Joe M500, Flickr (Creative Commons License)

John Mackey, Whole Foods CEO
Photo Source: Joe M500, Flickr (Creative Commons License)

The book’s premise flies in the face of Milton Friedman’s argument that the business of business is business. While Friedman makes the case that the only purpose of a business is to increase value for shareholders (i.e., maximize profits), John Mackey says its obligations are better understood as a balance among five groups of stakeholders:  stockholders, employees, customers, suppliers and the environment.

Mackey actually takes it one step further. He says companies that serve the interests of all the stakeholders have a competitive advantage. They create more value and are rewarded by the stock market.

After his speech I had the opportunity to ask Mackey a question. “If conscious capitalism is such a good thing,” I asked, “why aren’t more companies doing it?”

He responded by saying, in essence, that it just needed a vocabulary, someone to give it a voice, a demonstration to the world that it is a better way of doing business. “I’m giving all of you a secret formula for building a successful business,” he continued. “It will be copied as others see you succeed with it.”

Whole Foods is meant to be the living example of this better model.

Fast forward to this morning. I’m enjoying coffee with a friend at my local Whole Foods. It seems a good time to reflect on Mackey’s secret formula. Since last year the Whole Foods Market stock price has been cut almost in half, dropping from $65 per share to around $37. It’s been a rough ride. Continue Reading…

Last night Larry Page, Google’s CEO, posted this entry on his Google+ account, “Google Self-Driving Car Project,” with the video below.


“Just imagine,” begins the company’s description a future with self-driving cars,

You can take a trip downtown at lunchtime without a 20-minute buffer to find parking. Seniors can keep their freedom even if they can’t keep their car keys. And drunk and distracted driving? History.

This is bold. It’s exciting. And it’s just one of several projects Google is juggling that could actually change the world. The company calls these “moonshots” and runs them out of its Google X division, an R&D skunkworks charged with making such bold – though calculated – bets on the future.

But the story here is one part fanboy awe over Google’s investments in ground-breaking innovation and one part befuddlement over how  little other corporations are putting into long-term R&D bets. Continue Reading…

(Or, Why I Put My Money In Self-Help Credit Union, Part II)

 1.

When Michelle Holland started her little bus company in 2009, she would rouse her son at four each morning. He was ten and his single mom had no option but to grab his pillow and plop him in a rear seat of her refurbished yellow school bus while running routes through Charlotte’s neighborhoods. He would grab his last winks of sleep while she collected students from their homes for delivery to a local charter school. For the privilege of avoiding the hassles of car pools, the parents would pay Michelle a small fee each month. She would drop them off before extending her trip a few extra miles to get her own son to his school.

Such was start-up life for Michelle and her Eagle Bus Service. It was tough, but it supplemented the income from her bookkeeping practice. And after several years spent juggling the demands of an all-consuming corporate life with the demands of being a young, single mother, it let her be near her son more often.

Now word was spreading to other charter schools that Michelle could solve their transportation woes. The state gave them funding to educate kids in their own unique ways, but it didn’t give access to the county-run fleets of buses. Principals saw what Michelle was doing for her first client, and they wanted her to expand; to help them, too. They were offering guaranteed payments and year-long contracts if only Michelle could scale-up her service. If only she could get more buses and more drivers.

Michelle's Bus Fleet (Credit: Michelle Holland)

Michelle’s Bus Fleet (Credit: Michelle Holland)

This is the story I’m getting first hand from Michelle in a phone conversation one afternoon last fall. We had been trying to connect for weeks, but Michelle isn’t exactly swimming in spare time. Her morning schedule remains largely the same as it was in 2009 – up well before dawn, preparing to get students safely to school – and her days are spent balancing the desk work of Eagle Bus with the needs of her few remaining bookkeeping clients. In the meantime she was searching desperately for another bus to add to her growing fleet. She usually bought them in North Carolina, but someone was grabbing all the state surplus vehicles before she could get to them. Michelle had just driven to rural Virginia to find one that met her standards. We were speaking because I was interested in how she got the money for that purchase. Continue Reading…

Self Help Credit Union

Self-Help Credit Union in Durham
(Credit: Google Maps Street View)

I’m late for my lunch appointment and covering the 20-mile stretch of highway between Raleigh and Durham at a brisk pace. It’s the last day of September. While North Carolina is showing few signs of autumn, some cool air rolled in the night before and pushed the summer humidity out to the coast. With a shining sun, it’s perfect for rolling down the windows and letting the wind swirl around the faded leather interior of my old Toyota.

I’m heading downtown to meet Kristen Cox, an investment associate at Self-Help Credit Union.  I’ve been thinking about the Enough Project for a few weeks now, and I’m about to write my first check.

The idea is to put some chunk of our family money to work supporting conscious capitalist organizations and projects. We’re doing pretty well these days, financially speaking. I’m less and less compelled to make every dollar go into investments that aim for the highest possible returns. If there’s a tradeoff to be made between earning the highest return possible versus one that’s merely reasonable, I’m willing to explore the reasonable option when it means the money supports something constructive, meaningful and that provides some benefit to my community.

This is the gist of the Enough Project: putting a small slice of our money to work in ways that are consistent with the things we value.

Yet I find myself glancing anxiously at the passenger seat of my car. It’s empty save one checkbook wrapped in the same navy blue vinyl cover my bank issued me when I opened the account more years ago than I care to remember. I’m not sure why, but I’m a little nervous about using one of those checks to transfer our six-month emergency fund over to Self-Help. The transaction is riskless. The new account is covered by NCUA insurance, so it has all the protections the FDIC provides at my bank. It will earn the same interest rate it gets in my bank. It’s completely liquid with the money available to pull out anytime I might need it. True, the check is the biggest I’ve ever written, but I’m writing it to myself! Why the fear?

There’s something about this drive, about this check, about this Enough Project that has me thinking hard about my crazy relationship with money these past ten years. It’s creating a serious case of navel-gazing.

Flashback to June 2004. I was down to my last $50. Literally. And I had a wallet full of maxed-out credit cards, a mortgage-sized student loan payment, and a car note to boot.

It had been six months since my last paycheck, and my job options were so dim that I passed my days filling out applications on the Halliburton website. My mind spun vivid daydreams in which I drove 18-wheel supply trucks in caravans criss-crossing the deserts of  Iraq or Afghanistan, pulling a kevlar bucket tight by its chinstrap when the occasional mortar shell came whistling down. Spending the next year or two as a war contractor seemed my best option for income. Perhaps my only option to avoid whatever comes after one runs out of money to pay his creditors.

I remember lying across my bed in the middle of one sweltering Charlotte summer day, my roommate’s dog resting her muzzle on my thigh while my brain dizzied itself spinning through every desperate plan that might keep me afloat just a bit longer.

Suddenly it all stopped. My mind emptied itself, becoming utterly silent. Staring at the ceiling for what must have been five, maybe ten minutes of total quiet, the despair slowly gave way to a simmering anger. I muttered aloud, for no one in particular, “Never again.”

Continue Reading…

My September books brought so many amazing learning experiences, not to mention the discussions they generated with family, friends, colleagues and even one of the authors.

Financing Our Foodshed by Carol Peppe Hewitt

Let’s start with the winner of the prestigious Most Dog-Eared Book of the Month Award. Thank you Carol Peppe Hewitt for writing Financing Our Foodshed: Growing Local Food with Slow Money, a collection of 22 stories on North Carolina food entrepreneurs (farmers, bakers, restaurateurs and the like) to whom Slow Money NC has introduced local financiers eager to fund sustainable local eating ventures.

IMG_20130929_124805Mainstream investing has become overwhelmed by the opportunity cost heuristic, guided by the simplistic question, where can I make the most money as quickly as possible with the least risk? 

This is not entirely bad, and I’m not quick to cast moralistic aspersions on using capitalism in pursuit of profits. There’s a place for that, and there always will be. But it brings to mind the notion of hypertrophy, this glitch in evolution’s system by which nature allows (for example) a male ibix to grow horns so large, its neck cannot support the weight. Yet those large horns have become a proxy for virility, and the females are programmed to mate with him whose horns spread widest. And so this glitch propagates through the generations with the genes of big-horned ibix begetting even bigger-horned ibix until an entire species is handicapped with antlers with all appeal but no function. I can imagine the big cat mountain predator eager for this easy prey. Given enough generations of reproducing those big horns, the hypertrophy glitch will bring doom to that gene pool.

It’s not that big horns are bad, but there is such a thing as too big.

So it is with capitalism and opportunity cost. It’s not that it’s bad, but there can be too much.

In chasing the biggest-dollar, fastest-bang, lowest-risk return, we put all our resources into high-scale enterprise that promises crazy riches while we starve our local entrepreneurs of the capital they need to get off the ground or grow. Herein lies a hypertrophy risk in our investing system. We chase the promise of the next Facebook (that big-horned ibix) while ignoring the small-scale businesses that create happier, healthier, more sustainable local economies.

The weight of that imbalance threatens to topple us. Continue Reading…

Apparently my fascination with all things Zingerman’s knows no bounds as I explore this Enough Project. I’ve trolled a brilliant little video (by Daniel Seguin) featuring Zingerman’s co-founder, Paul Saginaw, that promotes a concept called “Localism.”

“There’s this idea of having enough” Paul narrates over beautiful pictures of the Zingerman’s businesses. “So when you believe that, when you’re not wanting more and more all the time, what’s driving you is wanting to create something of excellence. It’s liberating.

“What is this? Is it capitalism? Is it socialism? What do we have here? I don’t know if it’s capitalism. I know it’s not socialism. I don’t know what it is and it isn’t. But anybody can do it. It’s just a lot of work. But I would say try it. It’s also fun.”

(The video is here.)

(h/t to Ron Maurer for this link via Twitter)

IMG_20130911_091302

My brief trip to Ann Arbor last April introduced me to a real-life application of conscious capitalism. Zingerman’s Community of Businesses is a thriving enterprise that does good business while doing a lot of business good. Rather than extracting all the profits from their companies, the owners put back much more than they take out. It’s a model that deserves some deep contemplation, and it’s the example I turn to as I seek a new investing construct for myself. Allow me to introduce what I’m calling the Enough Project, a gonzo investing and writing experiment to see what kind of impact I can have by investing small amounts in good businesses committed to doing good.   

Eating in Ann Arbor

It’s raining hard this April morning as our rental car speeds west down the short stretch of interstate 94 connecting the Detroit airport to Ann Arbor. The windshield wipers set quick cadence, a rhythmic background for the good-humored argument entangling my two colleagues and me. My boss, Josh, sits in the back scrolling through his iPhone, barking out various Yelp recommendations for good eating options in Ann Arbor. Daniel is in the front seat, and I’m behind the wheel. We’ve already shrugged off Josh’s first suggestion – that we let some group of restaurants called Zingerman’s monopolize all of our meals – and now he’s tossing out alternatives.

Josh is our company’s resident foodie, and so we usually defer to his better judgement when it comes to dining on the road. Plus his wife earned a masters at the University of Michigan, so he can call on first hand experience when it comes to the local restaurant scene.

Yet we challenge his every recommendation – we’re feeling argumentative – and so we’re now resorting to the advice of anonymous Yelpers.

As Josh relays their suggestions, we sense his heart isn’t into any of the substitutes.

Okay, we finally relent. Your original idea sounds fine.

“Great!” Josh responds, his demeanor changing instantly.He dials a number and within seconds we have a dinner reservation that evening for some place called Zingerman’s Roadhouse.

Second Thoughts on Investing

I’ve been mulling over a change to my investment approach for nearly a year now, seeking to reconcile my desire for high returns with a growing sensibility to do something constructive and socially beneficial with my money. Continue Reading…

 

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With August at a close, here’s a look back at the ideas I permitted a brief interlude with that squishy matter between my ears.

A few years ago I was routinely knocking out ten books a month. And while I was getting good at parroting back the thoughts of so many authors, I wasn’t creating many of my own. So I’ve cut back, raising the bar on what material gets access to this impressionable brain of mine. The quantity has dropped dramatically, but those books that make the cut tend to be there to help me learn something from someone that understands it much better than I. Yeah, it’s kind of an attempt at a learning hack…I stack several books on similar topics over a matter of weeks, then step back and try to digest them.

This month it was:

Start Something That Matters by Blake Mycoskie the founder and CEO of TOMS shoes. These stories are absolute brain candy, and I can’t get enough of them. I love the feel-good narratives of dude getting a brilliant insight, leaning hard into his idea, and sitting on the top of the corporate world as a result. I suspend disbelief about all the hairy details they leave out, happy to get lost in the flow of a well-spun tale! Continue Reading…

Genius Vonnegut Heller

Flickr Photo by midniteboom. Used under creative commons license.

Joe Heller  

True story, Word of Honor:
Joseph Heller, an important and funny writer
now dead,
and I were at a party given by a billionaire
on Shelter Island.

I said, “Joe, how does it make you feel
to know that our host only yesterday
may have made more money
than your novel ‘Catch-22’
has earned in its entire history?”
And Joe said, “I’ve got something he can never have.”
And I said, “What on earth could that be, Joe?”
And Joe said, “The knowledge that I’ve got enough.”
Not bad! Rest in peace!”

–Kurt Vonnegut

The New Yorker, May 16th, 2005 (1)

I heard that poem last week listening to an audio book on my drive home from the Pennsylvania mountains. How liberating, I thought, to have a sense of enough. There is freedom in being content.

The quote knocked on my mind’s door once again this morning. I’ve begun a book by Muhammad Yunnus, the nobel laureate founder of Grameen Bank and self-labeled “banker to the poor.” He describes microcredit – the practice he pioneered, offering collateral-free loans as little as 30 or 40 bucks a piece – as a force for lifting people out of poverty; for giving them the means to sustain themselves with a livelihood. This brief line stuck with me:

“Access to capital, even on a tiny scale, can have transforming effect on human lives.” (2)

Continue Reading…

Business Gone Good

July 10, 2013 — 2 Comments

A musing on my recent mental captivity to conscious capitalism.

The Conscious Capitalism Pebble

Somehow, someway I was introduced to John Mackey’s 2007 manifesto, “Conscious Capitalism: Creating a New Paradigm for Business.” (1) That essay led to a book promoting the the notion that business can be done better and an organization to convene the like-minded around those ideals. (2)

And I can’t get enough of it.

I read Mackey’s essay nearly a year ago. It’s been like a pebble in my shoe since. Its slight, nagging presence won’t let me forget it; won’t let me ignore it. Its themes have dominated my recent essays, hijacked my reading stack, and overwhelmed my thinking.

So, why? Why this fixation on doing business in a better, more conscious way? Continue Reading…