I have met thousands of different types of investors throughout my career as an entrepreneur. Some investors that I have met unfortunately simply look at business and entrepreneurship as a way to earn a profit. I do not share this view.
I view entrepreneurship as a mechanism for having a positive social impact on society. Profit is simply a byproduct of solving problems for society.
When I founded my digital health startup Fruit Street, my investors and I decided to form it as a Delaware public benefit corporation. A public benefit corporation is a for profit company, but we write our social mission into our bylaws and make accomplishing our social mission just as important as generating revenue. In fact, if we were only generating revenue and not having a social impact – our management team would see little point in what we do every day. Our social mission is so important that we wrote it into our bylaws.
Fruit Street’s social mission is to prevent and treat lifestyle related disease using telemedicine, wearable devices, and mobile applications.
You might ask, why would we do this? Does it scare off investors that we are not a normal Delaware C-Corp?
The reason why we formed our company as a Delaware public benefit corporation is that the reason we started our company was to have a social impact. We wanted to only attract investors who shared our mission. We wanted investors who were not simply investing to get a return on investment like your traditional venture capitalists. We wanted investors who were also investing because they wanted to see their money have a positive impact in the world.
In our case, our physician investors are investing because they want us to develop a product that will actually help the patients they see every day in their clinics ranging from rural Alabama to the city of San Fransisco and all throughout the United States.
Fruit Street is a grassroots movement of physicians who want to improve healthcare with technology. There are no hedge funds involved or private equity funds with Fruit Street. Just a small committed group of citizens and healthcare professionals who want to change the world.
I would suggest to all entrepreneurs that want to change the world that you form your company as a public benefit corporation. If an investor has a problem with you wanting to make a profit while having a social impact at the same time, don’t take their money. There are plenty of investors who will share your vision for having a social impact.
Another phenomenon I have noticed is that there are two types of investors and two types of entrepreneurs. The first time of entrepreneur is the type that wants to be the founder of a startup because they think it’s the sexy thing to do and a way for them to make money. They decided they want to be an entrepreneur before they decide what the product or service is that they want to build.
The second type of entrepreneur is the one that recognizes a problem in society and decides he or she wants to solve it. That entrepreneur then realizes that starting a company and finding a team of great investors and entrepreneurs is a way to solve that problem at scale for society. This is the type of entrepreneur I am. When I volunteered in my local emergency room, I saw patients with preventable conditions such as diabetes and heart disease and decided something had to change. We needed to develop a way to deliver the diabetes prevention program at scale to millions of people using technology.
It is my opinion that entrepreneurs whose primary motivation is a social impact are more successful than those that are just looking for a quick exit.
If you build a team of entrepreneurs and investors that want to change the world, you just might.
Because someone once said that you should never doubt that a small group of committed citizens can change the world; indeed it is the only thing that ever has.