Purpose, Impact, and Warm-and-Fuzzy Feelings
Cathlyn, with her former company, teaching a group of students in northern Illinois.
Why Support For-Profit, Mission-Driven Businesses?
In short, it’s because I think every one of us has the capacity to leave the world a better place than we found it, and there are a lot of ways to do that.
Volunteering.
Parenting empathetic, communicative kids.
Improving the experience of the dying.
Serving on a nonprofit board.
Working for a for-profit business driven by a valuable mission.
I envision a mission-driven world.
I envision a world in which all organizations are mission-first—meaning, quite literally, that the mission was developed before the product or service, that serving the mission is the primary role of the company, and that every financial, structural, and developmental choice is weighed against the mission before being approved.
Of course, for for-profit organizations, the profitability of a choice should be part of that discussion, too. To ignore that element would be short-sighted. Because profitability = longevity. And longevity means that over time, the organization can do more good. And more good is . . . well, it’s more good.
And I believe we should all do as much good as we can with the time and resources we have.
In this world, we are all driven to improve the experiences of the people (and other creatures) around us.
I believe that it’s bigger than any one business or message.
The world has space for—and thrives on—a variety of organizations.
I believe that for-profit businesses and nonprofit businesses, and all their subsets, are valuable.
I’ve worked for nonprofits, donated my money to them, and volunteered my time. Nonprofit businesses, like for-profits, have the potential to do major good.
But not everyone shares that view.
In some industries, a 501(c)3 designation is a credibility marker.
In running my first LLC, an arts education company, my business partner and I often felt undervalued or untrusted because we didn’t have a nonprofit designation.
With a group of students in southeastern Wisconsin.
Serving both the arts industry and the education industry, there was an expectation to file for nonprofit status.
We considered that option. For a lot of reasons, it wasn’t the best fit for us. So we filed as an LLC, not realizing the uphill battle we had just cemented for ourselves.
We fielded a lot of questions, asked with knitted eyebrows, from prospects and professional peers. We were turned away from events. Our “for-profit” status made us suspect, even though we were serving children and families, and our salary over nearly a decade averaged less than $15,000 a year.
In the most dramatic season of my life with that organization, I chose to become homeless, eliminating my rent payment so that I could continue serving our students.
I remember during that time, we received an email from a parent who had missed a refund deadline—the second time she had done so for two consecutive programs. The first time, we made an exception to the policy and refunded her daughter’s summer camp fee.
The second time, we offered to hold the funds for a future enrollment for her own child or a friend.
In her response, she told us we were “greedy.”
“Greedy”—while I was living out of a suitcase and sleeping on the couches of generous friends so that I could afford to teach her child.
Ouch.
Across industries, people make assumptions based on your business entity.
We often assume good intentions from nonprofit organizations.
We’re shocked when it comes out that only 2.5% of a cancer cause’s donations go to cancer, while the organizer’s salary is almost a quarter million, and we feel duped when a kids’ charity spends ten times as much on its donors as it does granting wishes for kids.
Teaching choreography to students in Chicago.
We want to blindly trust that nonprofits are in it for the mission, but in doing so we place those organizations on a social pedestal, assuming that anyone who doesn’t register as a 501(c)3 is only “in it for the money.”
It’s clear that nonprofits aren’t always what we expect them to be.
And you probably already understand that being a “for-profit” business doesn’t mean you’re money-grubbing, selfish, or “greedy.”
But I want that to be universally understood.
I want everyone to understand that for-profit business owners often live to impact their local and global communities, just like our non-profit counterparts do.
I want to:
lift mission-driven business owners up onto that same pedestal as non-profit organizations
shape our collective understanding of the ways that mission-driven businesses are changing our world for the better
shift society’s definitions of “non-profit” and “for-profit”—leading us toward the mission-driven service culture I believe we all deserve
Choosing a business entity is a personal decision that business owner needs to carefully consider—there is no “right” answer.
From the beginning of our brainstorms around our arts education company, my former business partner and I knew that it would never be a “lucrative” venture. We expected to make a modest living fulfilling the need we saw for accessible and affordable arts education programming, especially across rural America.
A dress rehearsal with students in Chicago.
We assumed that any “profits” we made would turn over to support increased programming. (We later learned there’s a word for business like ours—”social enterprise”.)
What we didn’t expect that the struggle to pay ourselves would be great enough to affect my housing status.
But surprises and our reactions to them are just part of the challenge of entrepreneurship!
My business partner and I had both come of age in the performing arts—an industry in which filing for a 501(c)3 is a “given.”
Most arts businesses rely on private donors and government dollars to support 50% or more of their revenue. That means less than half of an arts organization’s budget is supported by earned revenue like ticket sales.
It was a big decision to go the LLC route., We were swimming against the tide.
Audience at a performance of “The Wizard of Oz”
So before we made that choice, we spoke with folks who ran non-profits and for-profit businesses, watched videos, read articles, and discussed at length the benefits and drawbacks of registering as a non-profit.
We weren’t worried about the re-investment requirements, public records, or any of the more stringent limitations placed on non-profits.
For us, it really came down to a couple of major issues.
The benefits of non-profit status (for us and our business)
✔️ Social acceptance: our peers in the arts industry and our prospects in the education industry expected arts and education programming to be non-profit
✔️ Ability to offer tax-deductibility for donations
✔️ The tax exemption benefits offered by the Illinois state government (where we were located)
The drawbacks of non-profit status (for us and our business)
✖️ The need for a board, which we didn’t really have the professional networks required to form
✖️ Survival by donation rather than service-based revenue
✖️ The ability down the line for a board to remove us as leaders, even after we created and built the whole shebang ourselves
Yeah. Especially that last one. Like the Little Red Hen, we were taking initiative. We were making an investment. We were doing the work. And we didn’t want someone to come along and take that freshly-baked bread away from us—we wanted to be able to share it!
My personal history means I’m personally invested in helping mission-driven businesses achieve their goals.
It’s important to me that my work as a copywriter serves mission-driven business owners—entrepreneurs whose eyes light up when they talk about the good they’re doing, the changes they’re seeing, and the communities they’re impacting.
Teaching a week-long theatre program in southern Indiana.
I champion your businesses and your message so you can have the social impact I know you're capable of.
By helping business owners grow their businesses and their impact, I indirectly get to be part of that good you’re doing for the world.
My business advocacy has a direct effect, too: I’m helping to destigmatize for-profit business. “For-profit” shouldn’t be a dirty word.
Plus, seeing these businesses succeed in doing the good they set out to do gives me the welcome side effect of warm-and-fuzzies.
Connect with me to share your mission and the good you’re doing. I’d love to hear from you.
Cathlyn Melvin is a writer and editor specializing in copy and content marketing for coaches, social enterprises, and other mission-driven businesses. To learn more about her work and how she can help you reach your ideal clients and grow your business, please visit www.rightcatcreative.com.