In its ongoing Angel Education seminar, the University City Science Center took aim Thursday at introducing private investors to the world of social entrepreneurship.
Working to educate investors on the possibilities of socially-minded work was a clear call to action from an earlier social entrepreneurship event in May, also at the Science Center, and organized by the Knight Foundation, Delaware Valley Grantmakers and, full disclosure, Technically Philly.
With more than 70 in the Quorum audience, including a dozen angel investors, organizers set out to define the world of mission-minded for-profit ventures, before featuring two panels: one of practitioners and one of investors. (GoodCompany Group and, full disclosure, Technically Philly, helped organize this event).
A few items from the panel of social entrepreneurs caught Technically Philly’s attention.
- Moderated by DreamIt Ventures cofounder and Kindertown lead Steve Welch, a self-described “capitalist pig,” the practitioners panel featured ElectNext’s Keya Dannenbaum, Brian Sowards of USEED and Edrizio de la Cruz, Regalii.
- “Philadelphia lacks social impact capital,” said de la Cruz, a more specific swipe at a region that has capital but an investor community that has been traditionally geared for latter-stage and more conservative investments. The relatively new concept of incorporating social impact into return hasn’t been embraced here, nor has a wide celebration of riskier, early-stage investment, he said.
- “Philadelphia is a great place to start a company but the challenge is the follow on support,” said Dannenbaum. Though she is committed to keeping Philadelphia as her base, she acknowledged the likelihood that she will need to open satellite offices in San Francisco and/or New York City, “driven by investment needs.”
- “Let startups be small things that need to go and they’ll come back and offer support,” said Sowards. He called for a ‘pay it forward’ model, in which regions allow their entrepreneurs to relocate to where makes most sense for them and expect them to someday return and offer support. Sowards said he left Delaware for the bigger market of Philadelphia — and Technically Philly notes that his Twitter location reads “New York, New York.”
- “90 percent of funding comes from friends and family,” claimed Sowards, suggesting that professional venture capital is just ‘the tip of the iceberg’ for investment. “A venture capitalist once told me that, ‘I might invest in you if you were my friend,” Sowards said. “So, ‘be my friend first.”
- “All entrepreneurship has social impact,” said moderator Welch, in echoing words from Philly Startup Leaders president Bob Moul at another recent social entrepreneurship event. He pushed panel members on the distinction: isn’t Apple the most socially minded company in the world, he asked, suggesting that the scale of their operation and their job creation is valuable. [Editor’s note: Panelists seemed to push back somewhat on their being something different about having positive impact as part of the business pitch, which Technically Philly brought up to Welch after the panel.]
- “I’ll think more about the ‘social’ as an entrepreneur, if the social entrepreneurs think more about the ‘entrepreneur’ part,” said Welch in his close. The cross-pollination of profit-mindedness and mission goals is a real success of the social entrepreneurship movement, he said.
This reporter gave an introductory overview of social entrepreneurship and the startup panel was followed by an investor panel for which this reporter was unable to stay.