February 2008

Vol. 1, Issue 2

Contents:
1. ONE STREET INVESTIGATES SOCIAL BUSINESS MODEL FOR BIKE SHOPS & SUPPLIERS
2. SUE NEEDS YOUR THOUGHTS ON SOCIAL BUSINESS FOR INCREASING BICYCLING
3. RESOURCE HIGHLIGHTS
4. SUPPORTER SPOTLIGHT - ADFC

5. Test

ONE STREET INVESTIGATES SOCIAL BUSINESS MODEL FOR BIKE SHOPS & SUPPLIERS

We are fascinated by the new social business model for bike shops and suppliers. Social business follows the sustainable for-profit structure, but instead of profits going to owners, they go to serving social needs. Investors receive their investment back, without profit, and can invest it again. Also, the products and services a social business offers serve social needs. Muhammad Yunus, the 2006 Nobel Peace Prize winner, explains social business in his book, Creating a World Without Poverty and this summary article.

Social business offers a fresh look at solving the serious problem of access to bike shops and affordable, sturdy bikes for the majority of the world’s population who live at or near the poverty level. It can offer a more efficient, global solution that keeps bikes close to where they are (and preferably where they are made!) as it lifts people from poverty forever, through running their own bike business or simply buying their own bike from which they create business opportunities.

Social business departs from the current for-profit structure that places profits above social needs. It also departs from the non-profit structure because leaders improve products, inventory turns and marketing instead of leaning on fundraising. But these current structures will offer critical support to such a social business effort. Because social business bike shops serve the needy they would not compete with for-profit bike shops. If an affluent customer wanted to get parts or service from a social business bike shop, they would be charged MORE than retail thus supporting service to the needy. Similar scaled pricing, as well as other important elements, already exists with charity and for-profit bike efforts. Social business could knit them all together.

This is why One Street sees so much potential in this new social business model. We are seeking funders and partners to help us coordinate such an effort. If this is interesting to you, please contact us. We’ll be thrilled to discuss your participation at any level.

SUE NEEDS YOUR THOUGHTS ON SOCIAL BUSINESS FOR INCREASING BICYCLING

At this early stage we need ideas and perspectives from all angles. For instance, several bicycle retailers I’ve discussed this with, have stated that their shop already is a social business and asked what would change. My answer was in record keeping of social needs met and declaring the legal formation of the shop as a social business, something Professor Yunus is developing.

But this leaves me with a concern: If socially-minded bike shop owners are happy with the current for-profit model, how will we attract potential owners to create social business bike shops and bike supply companies?

From the non-profit side, some leaders have asked why they would narrow their revenue stream that includes donors and grants, as well as social business-type revenue such as contracts, sales, and sponsorships. I told them a social business must not lean on donor income, otherwise its leaders will revert to fundraising instead of attracting customers, improving products and marketing their brand. This is how the social business model brings the success of capitalism to addressing social needs.

But this leaves me with a similar concern as above: The charity non-profit sector is an essential part of One Street’s work and we cherish these rare leaders. How can we attract potential social business owners if these sorts of leaders are already committed to the non-profit sector?

Another head scratcher is whether One Street would be most effective launching this effort in the shameful pockets of poverty of developed countries or sidling up to the profound number of charity efforts in developing countries.

If you have thoughts or concerns, as well as other effective ways we could launch this effort, please email them to me, Sue Knaup, One Street’s Executive Director: sue{at}onestreet.org. Thank you!

RESOURCE HIGHLIGHTS

This month, we thought you’d enjoy a few inspiring videos and links:

SUPPORTER SPOTLIGHT – ADFC

Allgemeiner Deutscher Fahrrad-Club (ADFC) is the German cycling federation and one of the very first supporters of One Street. Horst Hahn-Kloeckner, ADFC’s Managing Director, has been a One Street Advisor since our founding. Besides ADFC’s financial support, Horst brings an important expertise to One Street discussions – FUN! Horst is very serious about fun and believes that many of the problems in the bicycle advocacy movement are caused because we forget to have fun. This of course means while we are riding bikes with the people we rely on, but also during our meetings.

If all we do is talk about numbers, safety and laws we lose the heart of our movement – the fun of riding a bike and helping people discover this fun. Horst has brought fun to all of ADFC’s campaigns and programs. Their national office in Bremen supports local campaigns and events through their 16 regional offices, always ensuring these local leaders show people the fun of cycling. Flipping through their sophisticated web site www.adfc.de and magazine, Radwelt, you can’t help but notice all the smiling faces. ADFC is an excellent model for all organizations, not only because they have more then 120,000 paying members and are highly respected throughout Germany as the experts on cycling, but because they have been so successful keeping the fun of cycling at the heart of everything they do.