THE LAB

As loyal readers doubtless know, it’s microfinance week at Re-Vision Labs in honor of our partner, Oikocredit, with whom we’re next week hosting Seattle Greendrinks. Thing is, microfinance is about two things: helping people, and making money. Focusing more on the second than the first, in this post I’m going to explore banking a bit.

In recent times we’ve had a lot of cause to re-think where we put our money. Obviously, part of that is self-serving – the failure of countless banks, both those “too big to fail” and local community banks, has led many of us to worry for our savings (and yes, I know about that bundle of $20s under your mattress…).

Another reason many people are increasingly rethinking where they store their money, though, has more to do with social return on investment (SROI): people increasingly want to ensure that when it’s not in their hands, those holding their money are using it in ways that match their values.

There numerous ways to ensure both that one’s money is safe, and that’s it’s doing something worthy while you sleep. An obvious example, of course, is that you can invest in an entrepreneur in the developing world via microfinance organizations like Oikocredit (if the “obvious” part has you befuddled, please refer to the first sentence in this blog entry). While you earn a 2% return, your dollars are helping entrepreneurs across the globe pull themselves out of poverty. Awesome.

Another way to ensure your money is values-aligned is to pursue socially responsible investment (SRI). SRI generally divides into three categories: screening (what I call reactive), advocacy (me: proactive), and community investment (me: progressive). In reactive, investments are screened so as to avoid companies judged socially “bad” (i.e. those pumping oil, manufacturing cigarettes, etc), such as the Calvert Investments fund. Advocates invest actively in companies so as to foment shareholder activism for positive changes, an example of which is Newground Social Investment. Finally, community investing puts money in progressive companies or organizations working for social good; an example of this is Portland-based Portfolio 21. For a muuuuuch more thorough exploration of these ideas, check out SRI World or this article.

Of course, there are other conscious and wallet-safe places to put your money, including in values-based larger banks (ShoreBank comes to mind), local community banks (y’know, where they actually know your name), and credit unions (which’re like banks, except that they’re non-profit cooperatives owned by members, not shareholders, and their boards are mostly volunteers).

This is getting long, I know, so I’ll leave you with a fun look at someone else’s version of why you should re-think where you place your money. Enjoy, and happy (and safe) investing!

by Gabriel Scheer

Partner at Re-Vision Labs

As have many, I’ve been intrigued lately with the idea of distributed generation for energy. In particular, I’ve been giving thought to funding models and distribution mechanisms to enable power production in remote or under-developed areas of the world.

One model that I’ve seen and think is a great model is that of MicroEnergy Credits (full disclosure: we sponsored an event last week, Bloom, at which one of the founders of MEC spoke, and I know both founders). I think MEC is onto a really genius idea: in short, combine the best of microfinance (engage a community of investors, use their pooled assets to create a steady source of funding for individual entrepreneurs) with capital-intensive renewable energy development, and voila! A win/win/win, with investors getting a decent return, renewable energy projects getting built in the developing world, and an overall healthier, more connected planet. In MEC’s own words, they “aggregate carbon offsets, so that when companies and individuals take action to stop climate change, microentrepreneurs in developing countries are able to invest in clean energy as a component of their microfinance loan.” Love it.

Another model I’ve been watching is that of Hydrovolt. This Seattle-based company has invented a “revolutionary in-stream hydrokinetic turbine (system) that generates renewable energy from water currents. ” The thing that’s so cool about this idea is that these turbines aren’t just for massive developments (think Three Gorges…), but will work in any open channel. That means people can drop them into culverts, shipping canals, even streams – and in many cases, that means negligible environmental effect, as well as power generation in previously unused kinetic flow events (aka water sources that are just flowing away, unobstructed; I think I just made that last phrase up, but I like the sound of it). Interestingly, Hydrovolt is currently up for the 2009 Newpreneur of the Year award from Inc Magazine – you can vote until COB Friday, 6 November (and needless to say, I’d encourage you to do so).

I can’t help but wonder whether these innovative models – combining, as does RVL, the social/environmental mission with a bottom-line driven for-profit model aren’t the wave of the future, a model that will help us solve a huge number of the challenges faced globally. I’d love to learn of other great examples.

By Gabriel Scheer,

Founding Partner at Re-Vision Labs

I’ve been meaning to write this post for quite some time, but somehow keep back-burnering it.

It’s rare to find a content-producer that produces content in heaps of different topics, and yet, through them all, carries a theme that appeals to me. Take, for example, Your Favorite Band (which is undoubtedly cooler than My Favorite Band). My guess is that they have a common theme, something you really jive onto, that runs throughout their music. That theme is what makes even the duds tolerable.

This theme, of having an overall “good”-ness, is why I’ve been digging publisher Chelsea Green. I began exploring their books a while ago, and wrote a blog post on The Gort Cloud. As I dug deeper, I realized that this publisher, whose tagline is “The Politics and Practice of Sustainable Living,” is like My Favorite Band: a miss here and there, but by and large, an amazing repository of community engagement around sustainable living. I’ve short-listed below a couple “must-read” books I’ve really enjoyed.

Inquiries into the Nature of Slow Money: Investing as if Food, Farms, and Fertility Mattered - My bible, by a guy who knows better, Woody Tasch. This book, written by the former chairman of Investors’ Circle, addresses a “fiduciary responsibility that is not stuck in the industrial concepts of the nineteenth and twentieth centuries, but which reflects the new economic, social and environmental realities of the 21st century.” Needless to say, with the problems being experienced across the economy the last year plus, these ideas could not come at a better time. Some of the ideas explored in the book include the notion of localized investments (something I’ve also explored in past posts, including on CSAs and community-supported businesses), and an investment fund with a much broader understanding of its desired return on investment (for example, adding “soil quality” into the mix). I am saddened that I shall miss the first national congress of Slow Money, taking place in September (if you go – let me know how it was!).

Fresh Food from Small Spaces – I live in an apartment in the densest neighborhood west of the Mississippi and north of San Francisco. I want to garden. What’s a guy to do? This book’s a great how-to, featuring not only guidance on creating a garden in a small space (I created one in our alley, a photo of which is below), but also recipes for indoor “gardening” (creating things such as sauerkraut and growing mushrooms). It’s a great primer, a sweet tool for urban dwellers everywhere.

Chelsea Green has built itself as more than merely a publisher, offering a model for community engagement that could serve as a guide to other publishers. For starters, they have an active community blog that includes notable thinkers such as Naomi Wolf and Howard Dean (yes, that one). They also have a great Twitter integration, enabling their community to tweet not just about Chelsea Green, but about individual books and the like. They’ve got a great podcast series, and a newly-launched TV station. Finally, with a Green Tip of the Day and a deep blog roll, they have done a great job creating a site to which I just keep coming back.

That’s my paen to Chelsea Green, My Favorite (Band) Publisher. Who’s Your Favorite (Band)?

By Gabriel Scheer,

Founding Partner at Re-Vision Labs

As regular followers of the Re-Vision Labs team know, we recently moved into new offices, next to Mithun on Pier 56. It’s gorgeous space, and we’re loving it (come visit!). We’ve gained tremendous productivity.  The fellows and partners all have space together (in our last space, the wonderful Office Nomads, we were unfortunately too large a group for the space, resulting in our being spread all over the office), and we’re getting client work and internal projects done far more quickly and effectively. Awesome stuff.

The downside is that, as you may have noticed, I’ve been too busy with the move, new clients, and general life, to get much up on the blog. However, I’ve been saving some choice news pieces about Twitter for you readers. Without further ado:

1) One of the things we go on about at Re-Vision Labs is that Twitter and other social networking tools are just that: tools. Absent a coherent strategy, they simply play as any other media, willy-nilly, without any logical direction. However, that doesn’t stop them from being powerful tools, as an amazingly obtuse Chicago company recently learned. The company in question, Horizon Realty Group, had an angry tenant who tweeted a (relatively benign) comment to her 20 – yes, 2-0 – followers. Horizon saw the comment and sued for defamation – for $50,000! HRG has since backed down on some of their rhetoric (they added fuel to the smoldering ember of a connected world itchin’ for a villain). But the fact remains: they had no strategy for responding to social media, and instead, went reactionary. I’m sure they now wish they had had some degree of measured foresight. What’s your company’s strategy? Social media is happening, and will continue to happen. Are you engaged?

2) Been thinking a lot about how community organizing, with a heavy social media overlay, can transform government. Imagine if your comments, thoughts, and concerns could, rather than festering or being passed on as rumor or complaint, be voiced to a responsive government agency? Rather than believing government is wasting public money, what if people could easily dig into how the government is spending tax dollars, using the powerful new tools of our time to gain real-time access to information on how, where, and why tax dollars are being spent. I’m betting it’d increase confidence in the government, weed out the occasional weak spots, and in general, improve our political system. Here’s a great blog article from, oddly, the World Bank, on how Twitter can contribute to more transparent, participatory, and accountable government. Re-Vision Labs is exploring how our thinking can help transform government organizations; we look forward to moving the dial!

3) Did you know John Quincy Adams was a Twitter user? Well, neither did he – but his journal entries are, it turns out, perfectly-sized for Twitter. A Boston high schooler recently discovered this oddity, and now the Massachusetts Historical Society will be posting Adams’ sub-140 character journal entries (or, in contemporary parlance, micro-blogs) via Twitter. He wrote ‘em in 1809; in 2009, you can follow along on Twitter @JQAdams_MHS.

As some of you may have seen, I was recently quoted in a Sustainable Industries article, since picked up by Environmental Leader, about the use of social media by mission-driven organizations.

I believe mission-driven organizations have a particular opportunity to capitalize on social media. While the article carries only a relatively small part of what I said, the reality is that social media thrives on the same things that drive all successful mission-driven organizations: authenticity, transparency, and integrity. People are newly empowered to seek and/or dismiss information that is of interest (or not) to them. We are moving away from the era in which push marketing will be sufficient for increasing market share. Instead, we are moving into an era in which authentic, engaged dialogue with an organization’s community will be paramount to success.

All organizations should have a strategy for engaging with social media tools. Indeed, as another commentator in the article noted, organizations that aren’t actively engaged in social media conversations are in no way excluded from those conversations. By not engaging, they simply miss their opportunity to convey their opinions, side of the story, etc.

In working with our partners, it is exciting to see organizations that truly understand the power of engaging communities of people around their products and services, and who are eager to build out the infrastructure and understanding to support those relationships. I would argue that in the very near future, it is only through engaging people that products and services will succeed.

Are you ready?

Founding Partner at Re-Vision Labs

Who would have thought General Motors could conceivably come up with a convincing case that they’re re-inventing themselves? In a post a few weeks back (So You’re Buying a Car Company), I posited that the best chance for GM to reinvent themselves successfully is to seek a new, deeper understanding of their core stakeholder: the car-buying public. Well, maybe they listened.

Such is the conclusion to which one arrives after a story in this weekend’s paper, in which GM CEO Fritz Henderson declared “Business as usual is over at GM.” Of course, time will tell. However, initial signs are promising.

While the streamlining includes some typical moves – streamlining management by reducing by 35% the number of US executives, and halving top-level management – there are also signs of a new awareness of the power of community.

Of more interest, though, are the company’s stated new priorities: customers, cars, and changing GM’s culture. CEO Henderson noted, “At the new GM, we need to make the customer the center of everything.” Does that include product design? I’ll be curious to watch. An interesting move that, if accomplished effectively, would seem to support this new vision is the creation of a new website. Not yet launched, “Tell Fritz” is designed to enable people to share suggestions with the CEO. While a clunky method for community engagement, this is a step in the right direction. Likewise, Vice Chairman of Global Product Development Bob Lutz has already hosted a web chat (which you can see here)

The company also launched some other initiatives that gained a good deal of press, including a new plan to enable dealers in California to allow people to buy GM vehicles on eBay.

If I were Fritz Henderson, I’d undertake an aggressive online and offline community organizing project, in which I’d re-engage with the American people through channels that matter to them. I’d further seek to engage some of the country’s incredible minds in re-thinking the automobile. Not in terms of short-term design twists, but in terms of a systemic, “how would we do this if we were starting anew today” kind of way. I’d listen. A lot. To the people who actually might buy my vehicles.

Good luck, GM.

This weekend I had the good fortune to visit my farm.

Ok, full disclosure, I don’t actually have a farm. Rather, I got to visit the farm to which, earlier this year (as well as in past years), I sent a few hundred dollars. In exchange for that money, the farm, Boistfort Valley Farm, sends me a weekly box of delicious, fresh-picked, organic produce. They’re a CSA (Community Supported Agriculture) farm, one of many in Washington and around the country.

Thing is, it only just occurred to me that they are effectively using the microfinance model, as practiced in the developing world, here in the US. As the disconnected “investor,” I put my money in the work of an entrepreneur – in this case, Mike and Heidi Peroni (my farmers). They, in turn, return my investment, though in this case rather than returning it as cash, they return it in the form of fresh produce. As the farm succeeds or fails this summer, so too goes my investment. Tangentially, this results in being much more attuned to the weather.

Could this model be used for other goods? Etsy uses something somewhat similar with their “Alchemy” section, in which shoppers can request custom-made goods, along with an ideal price. However, they don’t include pre-payment as part of the deal.

But what about CSA-style pre-payments as a model for a variety of consumer products in the developed world? In essence, this is crowdsourcing demand – and payment – in advance of production. One can imagine companies providing a form upon which customers define their specs (within a range), pay their up-front investment within some pre-determined timeline, and then await the company attaining the critical mass to support creating the desired product(s).

What would you like today?