Social Venture Capital & Business Models

Interesting article on social venture capital - saying that in these tough economic times, it's the one area that may still have some juice.

"...If you're looking for investment money during these tough economic times, then the way to go is with a business venture that's socially responsible."

Great! We've got one. Let's talk.
VC's mentioned in the article:
Good Capital - Kevin Jones, Tim Freundlich
Benetech - Jim Fruchterman

The thing is, we've been structuring The Extras as a nonprofit (501c3) and seeking foundation funding (which incidentally costs about $0.50 for every $1 granted). It also takes us off the radar of investors expecting a return (in dollars vs. exclusively social good). We have, however, been considering for-profit/non-profit hybrid models. We've got so much on our plate right now, but perhaps exploring this type of model should move up to the top of the list. There are a lot of opportunities to generate revenue such as:

• Licensing the software on a white label basis (you can use it to create almost any iPhone application, with crowdsourcing applications being the easiest to produce quickly)
• Charging nonprofits to participate
• Selling the 'volunteer' service to corporations
• Selling the application to organizations as tool for operating intra-organization predictive markets (i love this idea!)
• Re-selling to existing volunteer organizations such as Volunteer Match & that cohort (since our approach very much complements and extends their model)
• Selling sponsored listings (assuming we have a lot of people using the thing)
• Charging the end-user
• Selling user contact info to nonprofits (with user permission). This, being the way that petition-based organizations earn revenue.

What we'd love is a business mentor - or a smart and committed biz-school type who can hash through the possibilities and models with us. Any takers? Any feedback on the business model ideas listed above?

Comments

[Dale Zak]

Jacob, perhaps you can register your nonprofit with http://www.razoo.com, might be a good way to attract some funding.

[Gautam Lamba]

- Licensing the software on a white label basis: no good unless your software is hard to replicate. free versions would pop-up given a critical mass of demand

- Charging nonprofits to participate: Would have to price it below their regular cost. + doesnt 'sit' right

- Selling the 'volunteer' service to corporations: corps tend to deny access to internal documents citing competition

- Selling the application to organizations as tool for operating intra-organization predictive markets: This is good, better you could sell it to corps as an internal productivity tool

Re-selling to existing volunteer organizations such as Volunteer Match & that cohort: possibly if they are looking to save on time consuming tasks

- Selling sponsored listings: only if its unobtrusive (google ads) and does not hurt the experience. Nielsen's BrandLift could give measure makreting ROI

- Charging the end-user: No

- Selling user contact info to nonprofits: They could just bypass you by seeing who all downloaded the app and getting the info from telecomm providers OR people get pissed upon receiving messages of which you can't control the frequency