Lansing native Thomas Stewart and his newest company, Common Wealth Enterprises, have a lofty goal: Show Lansing entrepreneurs that they can help the community first and then make money.
Many Capital region businesses create or contribute to socially beneficial programs after they’re successful.
But in a Stewart-driven world, these companies would do a complete 180, first developing ideas and business models that would help the community, and then making a profit. Stewart is after what’s been coined “social business,” a model that merges nonprofit and for-profit principles to help the community and make a profit for the business owner.
Stewart also owns Stewart Consulting, and has done human resources consulting and design for clients such as the Michigan Department of Natural Resources, Michigan State University's Fisheries and Wildlife Division and Neogen.
Capital Gains recently caught up with Stewart, who also writes a column about social business every Friday for the Detroit Examiner. He lives in Bath, where he houses his very own idea production facility that operates 24 hours a day, seven days a week.
Capital Gains: Can you explain how a social business works?
Thomas Stewart: It’s still a very up-in-the-air definition. To me, it means being able to take for profit and capitalistic ideas in both processes and procedures, apply them to a nonprofit world and create something that’s sustainable as opposed to something that’s dependent on grant money or charitable giving.
The idea is that once you can create something that’s sustainable and make money off it, there’s no limit to what you can do with your process.
Social business is basically a hybrid. You’re taking the best things of a for-profit world, and the best things of the non-profit world and combining them to do something sustainable.
CG: Where has the social business model been successful?
TS: The Haley House Bakery Café in Boston is a great example. They take low-income families and try to re-introduce them into the workforce.
They set up the restaurant side of their business for-profit, and have the rehabilitation/social aspect on the backside. They said, "We want to be able to rehabilitate people and help them become financially independent again. What are our skills and how can we do that?"
They were good bakers, apparently, and created a bakery café where they could employ low-income people, train them and have a job placement program at the end to place them in the workplace.
In Lansing, we could ask ourselves, what are the area’s needs? Do we have a bunch of people who are not financially independent? Do we have a lot of people who are on welfare? Do we have a lot of unemployed people? How do we get them back into employment?
CG: When did you get interested in social business?
TS: I have always wanted to work in something that has a cause. I’m very cause-oriented, and it’s really hard for me to get around my work if it’s empty.
I started doing research more than two years ago on how to be more involved in the community and read “Creating a World Without Poverty: Social Business and the Future of Capitalism” by Muhammad Yunus. He was involved with micro lending to poor people in India, but he was making money. He handed out $1,000 loans for people to start small businesses and all of a sudden they were asking for more money and paying back their loans.
It was sustainable because it was for-profit, not a non-profit system designed around helping the community.
People respect his work, but that’s not really what I see here. He says a social business doesn’t return any dividends, but in America, that’s unrealistic. Investors are still going to want to see, at the very least, a return at the rate of inflation. They’re not just going to give you money for free.
I want to show that you can do these things, benefit your community and make money. It’s not like they’re mutually exclusive things. I want to operate on that phrase that you can change the world, make money and be happy. And I’m trying to prove you can do it in America.
CG: What social businesses might work in Lansing?
TS: We’d like to explore something that involves music education. In general, this area is music-starved. We have one corporate Top 40 station and then 88.9 the Impact, which is really our only Indie music station, but they don’t play that all the time. We also have great music students and small venues like Mac’s or the Green Door. We have good artists that don’t get any exposure and they all feed to Chicago because there’s no exposure here.
We’d like to create a place where you can take Michigan State University’s (MSU) music education system and apply it to the people in Lansing who may not be able to afford a Big 10 education in music. We’d need to figure out a way to have local music in the front and training in the back, with low costs to play there. I think that would be huge.
There are 40,000 students here, and if all they can listen to is the Top 40 and the Impact, that’s a disservice. Lansing can benefit from MSU by tying music to education. The former location of the Silver Dollar would be a prime location for this type of venue. MSU is right there and Lansing’s on the other side. Getting those two to merge is key.
CG:Do you think the area's reached a critical mass to embrace that idea?
TS: Yes. In Lansing, not necessarily, but someone’s got to start a trend and be a trailblazer. Everyone is looking at more responsible businesses that give back to the community. People don’t want another socially irresponsible business community like Enron or the banks. People are sick of that.
Really, when you talk about social business, I think the hard thing for people to understand is that it’s a cultural shift. It’s a way of thinking.
I see a timeline of three to five years. First, there has to be a buy-in. And then I have to prove it’s a working model, so I have to be able to sustain it. It could be a huge failure for all I know. It’s something I’m really passionate about and I’m personally willing to take that risk because I think there’s a valuable lesson to be learned from it. Instead of saying, “My community’s a sidebar,” it’s saying, “My community is a priority.”
CG: So you’re not afraid to fail?
TS: Oh, gosh no. I anticipate it.
You have to put yourself out there if you want to be heard. You can’t sit in the background. I think I’m one of the only people in the area behind this right now and that’s partly because it’s an evolving and emerging concept, so even I don’t have all of the answers. Even the experts don’t have all of the answers.
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Dave Trumpie is the managing photographer for Capital Gains. He is a freelance photographer and owner of Trumpie Photography.
Photos:Thomas Stewart chats with Capital Gains
All Photographs © Dave Trumpie