Thursday, March 19, 2009

Part Two of Social Entrepreneurship Series: Growing Pains

I was thinking of deleting an old blog post, specifically this because it no longer applied to the label. Not those themes of sustinability and CSR of course, because that really *is* one of the main philosophies underlying the brand but rather, the specific declaration that partial proceeds of the label's revenue would be donated to the scholarship committee that I volunteered with.

But then, I realised that part of this journey for me was to be authentic and honest; hence, I've decided to share the details of how I came to this decision. In traditional business circles, this might be unthinkable, because you shield the public from the mis-steps one might make as an entrepreneur; however, I'll take muy chances and break all the traditional rules.

Anyway, it was with the best of intentions that I first declared that announcement - a mini corporate philanthropic commitment of sorts, if you will. However, I soon realised that it was counter-intuitive to any start-up to make that kind of commitment. Every single cent in the initial phase is needed to drive the business forward, and to bleed money (albeit to a good cause) like that was just plain bad business sense.

Worse still, feedback from peers seemed to suggest that there was a general mistrust about donating partial proceeds. In the worst case scenario, I was told that the public might think that I was merely raising my retail prices in order to keep my profit margin the same. This was especially so because I was new and that the public had no way of that I was taking a cut off my profits.

Ah well, the naivete of a start-up entrepreneur with a bleeding heart if you will. Having said that, I was reluctant to give up this element of CSR and I do believe that there are instances whereby CSR, or more specifically, micro "corporate philanthropy" could work for start-ups. I'll share more about it in my next post on this topic.

P.S. I still am volunteering with the committee. I'm just not linking it with the business anymore. :)

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