Summer 2011 Update

Thanks to all our friends and colleagues for the good wishes and questions over the past year of growth and change, and for all the congrats in response to announcements of Benefit Company status. Seems like the right time to say a bit about how we got here and to foreshadow what’s coming up.

The New Status
So the big news is the new business filing and slight name change, officially now ChangeMatters, Benefit LLC. We and our good friends Substance151 were the first two businesses to form as Benefit LLCs, with the help of Jon Widrick, Esq., Ascensus Law Group.

Maryland is the first state in the nation to offer this business category to LLCs, following its first mover status last year when it was the first state to establish the Benefit Corporation option. Benefit corporation laws were enacted in VT, NJ, and VA during the 2010 legislative session. Similar measures have also been introduced during 2010-2011 in CA, CO, HI, MI, NC, NY, PA with varying degrees of success. No other states—yet—are considering offering the designation to LLCs. The fundamental challenge with most of these laws, which is a function of the model legislation, is that they generally create a separate corporate category without actual legal protections, or direct incentives. And typically the laws have been passed in states without organized small business support.

Our response has been to bring business, advisors, agencies, investors, and funders together to figure out how to leverage these laws (and the energy behind them) for social change and economic development. In addition, we helped to fix the some of the limitations in Maryland’s law. Going forward, our team continues to follow and analyze this and related activity, and we are interested in working with leaders to build it up.

Oh, and just to address a frequent question: the phrase “B Corps” refers to entities that have received a certification from the nonprofit organization B Lab, and is not the same as having “benefit corporation” recognition by state governments.

How We Got Here and Why We Did It
ChangeMatters started in 1999, as a one-person shop, with a focus on strategic planning and fundraising services for charities and grassroots nonprofits. The portfolio grew to include some larger projects that allowed me to include colleagues on teams to work with small businesses, government agencies, and philanthropic efforts.

Maybe because of the training I was delivering in earned revenue as well as nonprofit leadership and organizational turnarounds, and also because of joint projects with other colleagues, new inquiries and referrals started to skew early-stage social enterprise. These “common good enterprises” didn’t really fit the traditional “nonprofit vs. for-profit” divide and sought to affect long-term sustainable social good through nontraditional business models.

These requests meant taking a fresh look at social enterprise activity involving economic development, public health, education, arts and culture, environment and sustainability. It led me to interview long-standing leaders in the field and some upstarts. It led to some rethinking. And to a deliberate expansion of I to we, which now includes a tight team of collaborating firms and individual consultants. And to our organizing a handful of open meetings, training, and dialogue events on the topic.

So, What Now?
ChangeMatters is neither a lobbying shop nor a certifying membership group for social enterprise. Simply a strategic consultancy to “common good enterprises,” providing planning, training, development, and technical assistance, we’re also dedicated to strengthening the overall field.

• We want tax-exempt social enterprises to have the right strategies, solid plans, sufficient funding, and the technical chops to do the business of mission.
• We want businesses formed for social good to succeed and stay aligned with their principles and values.
• We want business service providers and advisors to better understand this economic space and serve these enterprises more effectively.
• We also want states and communities to help fulfill the promise of common good enterprise and to support these increasingly diverse community-enriching businesses and investment models.

While the vision is ambitious, the intensive focus on social enterprises and socially-responsible small business and the increased teaming with complimentary firms and consultants represents an evolution from the nonprofit planning and fundraising consulting I’ve been doing since 1999.

Increasingly I am seeing the best practical work of ChangeMatters, Benefit LLC as navigating this middle space between service and commerce:
• Helping early-stage and transition phase social enterprises with planning and training,
• Facilitating dialogue and action, and
• Making connections to resources.

Contact us anytime we might be the right resource for you or others in your networks.