Part 2 of our toolkit aims to open source the double half methodology through the revealing of answers to questions that have been sourced from entrepreneurs from around the world that are currently in the process of launching a business inspired by verynice’s 50% pro-bono business model. We asked 20 entrepreneurs spanning four continents to send in difficult questions with the hopes of exploring the details behind different key components of the business model.
Our prompt resulted in over 200 diverse questions that fell under a wide range of topics and scenarios that were relevant to each individual submitter. After finding a lot of common concerns and points of stress from each of our participations, we then narrowed the questions down to a total of 99 and categorized them into 11 categories including: the model, starting up, collaboration, incentives, branding/marketing, client relations, scaling/growth, policy making, quality assurance, risks, and common critiques. Our goal for this section of “How to Give Over Half Your Work Away for Free” is not to provide a heavily edited forum of the most amazing answers in the world, but to instead curate a series of honest inputs and best practices that have been learned over years of trial and error. Because this section of the book is very dynamic and rough, we do not see it as finished, and hope that this first publication will spark a lot of debate and follow-up questions. Please be sure to write us with additional questions, and you will see those published up on our online version of the book shortly.
While the model itself seems simple (double your workload, give half away), there are a fair amount of cogs that keep the machine turning. In this section of the Frequently Asked Questions, we will cover the primary components that make the model possible, who should use the model, who shouldn’t use the model, why it is important for small businesses to be thinking about philanthropic models, the reason for giving 50% as opposed to 10 or 20%, and how the model will affect your current business.
A1: What is the model, how does it work, and what are its primary components?
Give over half of your work away for free by institutionalizing an ongoing pro-bono initiative that is an integral component of your business in order to provide your services to those who deserve it, while still maintaining happiness and profitability in your business. Put simply, the double-half methodology has been made possible through intensive development and iteration over the course of over five years that has resulted in a unique customization/combination of four approaches to business strategy: capacity building, business development, financial planning, and time management.
1. Capacity Building: If you are giving half of your work away for free, you need to do twice the amount of work. That said, you need to not miss out on sleep. The model calls for a creative approach to capacity building that embraces remote collaboration and network development.
2. Business Development: The model allows for sincere and authentic client relationships that lend themselves well to project referrals. The model calls for a very intentional use of word-of-mouth as the primary marketing tool.
3. Financial Planning: Although the success of the model has no limits, monetarily, up-front there is going to be some sacrifice, as with any business. As a result, the model calls for a conservative approach to corporate overhead.
4. Time Management: Because the model requires a high volume of projects at any given time, the development of time management processes that work for you is a necessity in the process of developing your verynice entity.
A2: Who is the model best suited for?
The model is designed specifically for independent contractors, freelancers, entrepreneurs, and small business owners that are offering a service. While we are interested in the product space as well, this model is not designed for that space as there have already been many instances of successful giving amongst product-oriented businesses. If you do have a product, and you are interested in a model that has proven to be successful in its replication, please refer to the One for One model that has been popularized by TOMS Shoes.
The double half methodology is best suited for individuals and small collectives that are at an early stage, or seasoned entrepreneurs that are looking to make a big shift in their career for the greater good. The model was originally invented by Matthew Manos for his design firm, verynice, but is in no way limited to the design industry/creative fields. The model is open to any and all service providers including, but not limited to: designers, architects, consultants, lawyers, doctors, hair stylists, and more.
A3: What are the most unique features that make this different from other pro-bono models?
There are a handful of other pro-bono models out there, including intermediary programs, crowdsourcing, pledges of 1% of your time, and hack-a-thon-style “marathons” that take place over a weekend. While all of these models have resulted in significant impact and awareness, none of them have been able to turn pro-bono into an integral component of business. Instead, each model has kept the perception of corporate giving as something you do on the side as
The most unique component of our model as opposed to these other models is that we have been able to make philanthropy a part of the day-to-day of your business while still maintaining profitability. The fact that this is a for-profit model also makes it stand out and allows for freedom from the restrictions a non-profit organization faces.
A4: Why do we need this model?
I’ve seen first-hand the struggles that non-profit organizations go through to keep their doors open every day. 90% of a young organization’s time goes toward the writing of applications for grants that can allow them to pay for things like marketing, design, consultation, and a plethora of other services. According to the Harvard Business Review, annual design and marketing expenditures for all non-profit organizations in the United States alone come close to 8 billion dollars every single year. Those rates, and those expenditures, are only getting higher. It simply is not sustainable. Imagine what impact could be made if the need to allocate those financial resources to people like us (service providers) was completely eliminated.
I know what you’re thinking—Oh no! If we stop charging non-profit organizations, we will lose so much business! My answer to that concern (which I am confronted with often) is this: According to the SBA, there are 27.5 million small businesses. That makes up for 99.9% of businesses in the United States. As of 2012, there are 1.04 million non-profit organizations. If we choose not to profit off of those that do not seek to profit, we can make our money elsewhere, easily. By taking money away from a non-profit’s budget to make impact, we are taking away from their potential to make impact. 1% is not enough, in my opinion, which is why we strive to create a model that dedicates over 50%, while still thriving as a company. I define an extracurricular activity as something we spend less than half of our efforts doing. If we want to get serious about making an impact, it is my sincere belief that we need to start making giving back an integral component of business, something that gets a lot of focus, not something we do on the side.
A5: How do I know if I’m a good candidate to apply the model to my business?
This model is only intended for adoption by a service provider, or service-oriented business. The model is not optimized for product-oriented business. The model is not intended for service providers with a very specific vertical, but instead favors those with a broad demographic/audience.
This model is not for anyone and everyone. It is hard, it takes patience. You will not get rich fast. The ideal candidate for the integration of this model is someone that is sick of working hours upon hours to sell, what Steve Jobs would refer to as “sugar water.” You are a good candidate for this model if you are serious about making philanthropy an integral component of your day-to-day business. This model is not for the individual that is OK with stopping at 1%. This model is OK for the individual that wants to START with 1%, and then grow their impact exponentially.
A6: How is pro-bono a more valuable asset financially to non-profit organizations, in the long run, then monetary donations? What is the value of skills-based volunteering?
Pro-bono is a valuable asset to non-profit organizations because it provides them with a valuable resource that they would have spent at least a portion of their dollars toward anyways. Dollars can only take you so far; time and experience are multipliers in this industry. Beyond that component of pro-bono’s value, it is also the most accessible way to create social impact. There are far more of us with valuable skills then there are people with extraordinary wealth. For small businesses and independent contractors, pro-bono really is the only possible way to give back to a non-profit organization at the same scale of impact that the big guys can have. When you are a billion dollar company, it is easy to give out a million dollars here and there. When you are making barely six figures, on the other hand, giving enough money to have any impact at all beyond a new set of office supplies is simply impossible. Pro-bono is your only chance to make an impact on an organization as a small business.
Anyone can clean up a beach. That’s a simple task, and people have been doing it for years. Sure, we can continue to define ‘service’ and ‘volunteerism’ in that way, but wouldn’t a more productive question be ‘how can we ensure that beaches never get dirty again?’ That is a big question, but it is one that can be answered by leveraging the unique talents each of us brings to the table. This isn’t a new idea—it’s actually a movement, the idea of skills-based volunteering. I believe that design has the power to answer big questions like that, and that designers have a unique ability to see the big picture in order to integrate sustainable impact in our daily lives.
A7: Will the model affect my current clients?
The model will not affect your current clientele, it will likely add to it, though. The model can be gradually implemented in a manner that can slowly introduce new pro-bono clients to build you up into the 51%+ pro-bono ratio. Keep track of your ratio as you go along. If you currently have five clients, four that are paid, one that is volunteer, gradually add at least four more pro-bono projects that you can be working on.
If your current clientele is primarily non-profit organizations, and they have already agreed to a billable scope, do not worry about paying them back the money they have already distributed to you. That will be too much of a hassle for them to work out on the accounting side. Instead, waive any and all additional fees that would have accumulated from future work.
A8: How long will the model take to implement? Is implementation gradual or immediate?
Years or minutes. The model can be implemented easily for startups, but can take more time for businesses that are already established in their respective fields.
1. Startups: For startups, we recommend launching with a 100% pro-bono model, and then gradually introduce paid clientele as time goes on. We have found this implementation plan to be successful as finding clients that are willing to take a risk by hiring a less experienced practitioner (like a startup) is easier when there is no financial risk involved. Also, these non-profit engagements, as we will cover in the section on incentives, tend to develop a strong referral base that can help you build a network and find paid work easily.
2. Established Businesses: For established businesses, you will be launching with a 0% pro-bono model, and then gradually adding additional non-profit projects to your current project list. Implementation for an established business can take time, and therefore we recommend establishing a “pro-bono” plan that calls for an immediate integration of 10% pro-bono, and then over the course of a year, build yourself up to at least 50% pro-bono.
A9: Can I add other elements to the framework? What components of the model are flexible?
Most of the model is not flexible as much trial and error has gone in to making it perfectly replicable and sustainable. That said, the primary component of the model that is flexible is the specific service being offered, the specific means of growing capacity, and the specific benefactor that will receive your pro-bono offering. We will highlight solutions to each of these components in the guide book, but they are in no means the only route to take in establishing a system that works for you.
A10: Really? 50% pro-bono? Why not 1, 5, 10, 20, 30, or 40?
This is a philosophical decision, not a logistical one. The model calls for at least 50% based on the belief that anything you spend less than half of your time doing is an extracurricular activity. There are many businesses out there that integrate varying amounts of philanthropy into their business, but to make a true impact, this model requires giving back to become an integral component of our daily lives.
A11: What role does outsourcing play in this model?
This model thrives off of the philosophy that remote working relationships are the future of business, and that we only go to an office because there is one. It is crucial to keep your in-house overhead as lean as possible. One major way to do this is to get comfortable with outsourcing a lot of the work and assuming the role of manager or creative director or facilitator (depending on your industry) in order to oversee all of the work that is being done. To clarify: this model is not a method of “crowdsourcing,” instead; it is a model that thrives off of “outsourcing” practices. The primary difference is that crowdsourcing, by the very nature of it, is the production of work by a group of people that you do not necessarily know or have any need to engage with. Outsourcing, on the other hand, just leverages one or two people for any given project to get the necessary work done. Historically, outsourcing has been leveraged in this model for two types of contributors: volunteers + freelancers. The “short-list” of sorts that you create will consist of a group of people that you trust and enjoy working with. When you have a volunteer opportunity, you will leverage someone from that network as a volunteer to join you in your pro-bono efforts. When you have a paid opportunity, you will dip into that same network to hire an independent contractor/freelancer to work with you on that specific gig.
A12: How do you measure impact? Is it Quantitative vs. Qualitative?
The impact that the double-half methodology can allow for is purely quantitative. Your work as a service provider that is leveraging this model is a supporting role. You are not the star of an organization’s impact, but you sure can make their impact possible. Qualitative means of measuring impact in the social good space is not something that is possible or productive with a model like this. Instead, the impact of your company is measured in financial and locational means. Keep a close tally of how much the pro-bono projects you are completing are worth. Keep an eye on where the organizations you are helping operate. By keeping a log of these two items, you will be able to know how much money you have saved non-profit organizations collectively as well as where the work that you have helped support is taking place.