The 2015 Praxis Community Letter

Taking Inventory and Building Vision for our Next Phase

When Josh and I first exchanged handshakes in April 2010, it began a journey that has been everything we dared to imagine, and then some. We have no doubt lived through an initial season of God’s favor and significant cultural momentum in our field of work. First, as a part of the Praxis community, I wanted to take a moment to say thank you for the variety of ways you’ve made everything possible. From our entire team, we are truly grateful. Second, I wanted to share a reflection on the “state of the organization” and welcome you into a dialogue on:

  • What have we begun to create?
  • What is happening in the field of entrepreneurship?
  • What are the next opportunities for Praxis?

These are not new questions but rather evolving conversations that come from our ideas and reflections. With every step of progress, new doors and paths are opened that require discernment, wisdom, and then ultimately action, and as with everything we do, these are collective endeavors.

I’d like to state my primary hypothesis up front: In this entrepreneurial age like none other in history, Praxis has just begun to scratch the surface of possibility. We’ve laid the foundational infrastructure that has the potential to create a snowball effect, allowing us to impact culture in increasingly meaningful ways, all while creating a compelling Christian community that can be a winsome witness to the broader society.


What have we begun to create?

A Community, A Venture Group, A University

Community
With over 100 entrepreneurs, 150 mentors, and 350 investors and philanthropists thus far, we’re fortunate to have great traction in building an expansive community with a shared mission and an alternative imagination for the spirit of the age in our time. The Praxis Accelerators — both by happenstance and by design — have allowed us to create an expansive entrepreneurial community that is deeply interested in building and growing new ventures aimed at bringing the Kingdom of God on earth. Working together is critical: as author Mark Scandrette articulates, “Community is not the best goal in itself — it is the byproduct of shared vision, activities, practices and commitments.”

Most importantly, we consistently get comments about the quality of people; it’s a group with a shared ethos of vocational excellence and spiritual depth. These relationships are founded on the deepest convictions and nurtured through working with others who share the same truths; participants are feeling the community through shared goals, language, practices, and friendship.

This community-driven approach is not lost on the startup world. The article Is Community the Newest Pillar in the Venture Capital Business Model? excellently articulates how basically every VC firm of significance sees this area as core to their ability to be more than commoditized capital. While community is not the end itself, it creates an incredible foundation that enables greater and greater things.

Venture Group
With the excellence of a venture capital firm, we aim to provide great advice, while organizing and directing critical resources to our Praxis Fellows, including key introductions to partners, capital, and talent. To be sure, our ability to be both an effective venture group is derived from our effectiveness at cultivating, organizing, and engaging the people in the Praxis ecosystem.

So far, we are experiencing exciting results. Through relationships initiated at our Accelerator events, over $9.5 million has been placed to our Nonprofit and Business Fellows. Organizational growth is 23% year over year for our nonprofits, and a remarkable (and unsustainable!) 71% for our businesses. Collectively, our first 60 startups had over $74m in 2014 revenue.

Those are the numbers. But one story is a great example of how we hope our community can be mobilized. Ben & Laura Harrison, founders of Jonas Paul Eyewear, entered the Praxis program with a moving personal story and a small but growing business around fashionable kids eye-wear. The kind that wards away four-eyes jokes with flat out style. At our Praxis Finale they presented to a room of over 90 investors. One of them was David McKinnon, a serial entrepreneur who happened to be friends with the ex-CEO of Lenscrafters. Just after the Finale, the pieces came together for a meeting, and a few months later the Harrison’s received a $500,000 investment and two new Christian board members: the Lenscrafters ex-CEO and a VP from Luxottica, a firm that virtually runs retail eyeglasses in America. Ben & Laura added one more board member — a mentor they met at the Praxis kickoff — and have set about to really grow JPE into a big brand.

A New Kind of University
Finally, through our community’s unique content and experiences, we aim to create a new kind of university: a leaner and practical form of educational offerings for entrepreneurs of all stages, all within a backbone of theological and cultural understanding.

Our first endeavors in learning have not been just through the Accelerators, but also through Praxis Academy, which has now graduated 200 students over its first two years and has already built significant institutional partnerships with Gordon, Wheaton, Biola, Messiah, and Taylor. Beyond the learning that happens there, Academy fits quite wonderfully into the ecosystem as the talent base for the future of this community, training and shaping the next generation of founders and startup-interested talent to join our Fellows in their work.

To this end, this year saw the launch of the Future Founders program, an apprenticeship program that placed 10 top undergraduates — including the student body president from both Wheaton and Gordon — with our Accelerator Alumni for 6-week deep dives into life as an entrepreneurial leader. A wonderful byproduct of the program: two of the ten were ultimately hired to stay on with the Fellows.

As we build out further relationships with schools, create digital content from across our ecosystem, and convene our community for ongoing learning, we think there is a distinct opportunity to be a part of the foundations of education in this growing space.

What is happening in the field of entrepreneurship?

The Next 5 Years: Two Areas to Watch

#1 — Faith & Entrepreneurship activities rapidly expand

Back in 2010 we were fortunate to be among the first movers in our field of Christian entrepreneurship. Today, we are seeing an ever increasing amount of activity. Our own Henry Kaestner (board member) is leading Sovereign’s Capital, deploying over $40m to both international and domestic Christian-led companies. Crossroads Church in Cincinnati launched the Ocean Accelerator and hosted an entrepreneurship conference called Unpolished. Telos Ventures launched an undergraduate faith-based business plan competition called Elevate. Both the Maclellan Foundation and Hobby Lobby have created investment funds to back Christian entrepreneurs working in a range of industries and delivering a range of impact. Jeff Johns and Aimee Minnich have launched the Impact Foundation to help individuals use Donor Advised Funds (DAF’s) to finance impact related investments. All these are signs that we are at just the beginning of a strong move the global Church will make into this space. As momentum grows, this is likely to surface both excellence and depth-of-theology challenges, but overall this is a very exciting time. Indeed, we may be in on the front end of a “movement” of sorts that reshapes the imagination of a generation of entrepreneurs.

We believe our team & community is very well positioned to be the thought leaders in this conversation. This year, our small team has published books with Simon & Schuster, Harvard Business Review Press, and Bethany House, and have spoken at over fifty significant engagements. If Praxis can lead this faith & entrepreneurship conversation, we create a natural pathway to the highest, most scalable levels of impact through the stories we tell and the virtuous recruiting and community building that comes from a larger reach, all while grounding this larger-than-Praxis conversation in strong theology.

#2 — The Startup Studio as a new model for impact

Not an incubator that provides space, or an an accelerator that helps entrepreneurs through mentorship, the emerging “startup studio” model is often described as “parallel entrepreneurship” which involves an executive team, often working with entrepreneurs-in-residence (EIRs), that is dedicated to building a process to continuously co-founding and launching several new ventures at a time.

Worldwide, there are now over 100 of these studios, many founded by A-List entrepreneurial talent. There are three groups pioneering this model: Betaworks, Science Inc, and Expa. Via the Financial Times, let’s take a brief look at Betaworks with a particular eye on structure, model, and capitalization:

It is an unusual structure, the closest parallel being at internet holding companies such as Liberty Interactive and Barry Diller’s IAC. The ultimate example of a combined fund and holding company is Warren Buffett’s Berkshire Hathaway, still more or less unique 47 years after Mr Buffett acquired the original textile business. Unlike a venture capital fund, the Betaworks founders are not paid a management fee and are under no pressure to seek a cash exit by selling their successful startups. “Not getting paid to manage money was really important,” says Mr Weissman. “We did not want there to be management fee pressure to do anything.” Instead, they have their own stakes in the company.

Within this holding company model — also employed by Science and Expa — these studios have C-level teams that are high-capacity; in such a demanding environment there is little room for learning on the job. In the vein of IDEO-style hiring, top talent are “T-shaped” with both a broad curiosity and capability and a deep speciality. Additionally, given the variety of work, many of them rely on a small team of specialists that are builders, either through junior talent, a strong base of close partnerships with service providers, key contractors, or all of the above. Ultimately, however structured, the studio model offers a very unique model to take multiple, important ideas into the world via a small mission-aligned team and efficient relationships and resources. In the next years ahead, expect to see these all over the place — focusing on many different types of industries, missions, and geographies.

What are the next opportunities at Praxis?

Building our capacity for impact

Given all of the above, what should we do next? Here’s a few thoughts on growth across the community, venture group, and university lenses.

  1. Community: Deepening & Expanding Our Reach

From here, how might the Praxis Community grow? As discussed at the beginning of this essay, the Accelerators and Academy have been and will continue to be the anchors of the community that is organized. Yet there are several key initiatives that we believe will build community even further.

Alumni Engagement

Now that we have a critical mass of 72 Ventures and 100+ entrepreneurs who have gone through our programs, we need to rapidly deploy resources towards alumni support, continuing to engage with both the Fellows and their ventures. Key initiatives will include alumni-only retreats, office hours with our extended team, ongoing introductions, intentional prayer, and working with them to bring strategic new initiatives to life.

The Praxis Venture Partners

The Praxis Venture Partner role is a new position reserved for a few extremely capable individuals committed to building Praxis while employed in other organizations. As leaders in different domains and communities, this group can collectively greatly extend our reach & impact. Venture Partners participation includes: helping form vision & strategy, doing recruiting, providing mentoring and key introductions within the Accelerator, Academy, & Alumni, and helping us attract key advocates & supporters at our Finales. Over time, we envision a Praxis Venture Partner community comprised of the best Christian entrepreneurs that cover nearly every geography and industry, creating a highly effective network to get things done for the Kingdom. Initial Venture Partners include Evan Loomis (Wedgwood Circle, Treehouse), Will Haughey (co-founder, Tegu), Peter Greer (CEO, HOPE International, and Jena Lee Nardella (founder, Blood:Water Mission).

The Praxis Scholars

The Praxis Scholar role is similar to the Venture Partner role in structure — it is reserved for a few thought-leaders who desire to help us build, guide, and shape the theological and cultural imagination of the next generation of Christ-following entrepreneurs. Not only do Scholars actively share their theological & cultural insight with our entrepreneurs, mentors, philanthropists, and investors, but they also think strategically with the Praxis leadership team on how our community might shape the broader cultural narrative. Praxis Scholars are involved in the fabric of our activities, participating in both of our Accelerator programs, Praxis Academy, and ultimately becoming implicated in our community of relationship. Our first three scholars are Andy Crouch (Christianity Today), Steve Garber (The Washington Institute), and Jon Tyson (Trinity Grace Church NYC).

Praxis Course for Entrepreneurs

Finally, we anticipate building out an 10-week course for entrepreneurs exploring what the Christian faith means for their startups and lives. Leaning on the body of content from our events over the last few years, this journey into theology would borrow from the model of Alpha Course: locally-hosted video talks over dinner, as well as a weekend away to process the bigger questions and build community. We anticipate these initially being led by a mentor or alumnus, while being a great fit for a church, university, or city-based setting. Content would feature talks such as:

Jon Tyson — Theology: Joining God in the Renewal of All Things
Steve Garber — Responsibility: Vocation & Sustainability
James K.A. Smith — Worship: Entrepreneurship & Desire
Dave Evans — Strategy: Decision Making & Discernment
Jason Locy — Story: Shaping Worldview through Narrative
Evan Loomis — Friendship: Relationships & Resources
Andy Crouch — Culture: Rediscovering our Creative Calling
Jon Tyson — Identity: Results May Vary
April & Craig Chapman — Generosity: Sharing Your First Fruits
Jena Lee Nardella — Reality: Knowing the World & Loving the World
Dave Blanchard — Virtue: Entrepreneurship Beyond Ethics
Steve Graves — Leadership: Four Stages of the Organization
Will Haughey — Comparison: The Dark Side of Entrepreneurship
Peter Greer — Motive: The Spiritual Danger of Doing Good
Dave Blanchard — Counterculture: An Alternative Imagination
Jon Tyson — Competition: Breaking A Spirit of Mammon

A course like this could be widely distributed, multiplying the reach and impact of the organization through decentralized learning, reaching the small business and nonprofit leaders that our Accelerator programs are well positioned to do. Moreover, it could act as an awareness pipeline for our Accelerator programs.

All of these initiatives, combined with the ongoing work of the Academy and Accelerators, provide exciting opportunities for us to continue to build out the relational depth and breadth of the Praxis ecosystem.

2. Venture Group & University: Imagining and Creating New Organizations

Let’s revisit a favorite quote of mine:

“The key actor in history is not individual genius but rather the network, and the new institutions that are created out of those networks.”
James Davison Hunter, To Change The World

While Hunter affirms it’s all about community, he says more: it’s not just our ability to assemble a network and connect people — but what is created out of those networks.

Certainly our current Accelerators fit into this theory of change, given our ability to help startups scale and become the next institutions. However, thus far we’ve not ventured into the earliest stage of venture origination — the time where ideas, vision, and outcomes are given the most form and shape. And if we’ve learned anything in the last four years of Praxis, it’s that initial founder’s intent and vision is incredibly powerful. As Bill Gates said at the TED conference:

There are some very important problems that don’t get worked on naturally. That is, the market does not drive [people] to do the right things. And only by paying attention to these things, and having brilliant people who care, and draw other people in, can we make as much progress as we need to.

To move the field and impact forward, we believe that we must not only accelerate ventures already in motion, but also take part in creating new ventures critical to our world’s ability to experience and understand what the Gospel means to every industry. Given this, we’re setting out to create the Praxis Venture Lab, our own ‘startup studio’, which works with Entrepreneurs-in-Residence (EIRs) to launch new businesses and nonprofits.

Fundamentally, the studio is focused on cultural intent: every venture we work to launch will attempt to have a specific and strategic impact in the world. It is in this intent that there are many frontiers yet to explore, and opportunities to disrupt negative cultural trends and encourage positive emerging trends with innovative Gospel-minded ventures. Indeed, for the most part, we are just now reaching a critical mass in the Church that agrees that God cares about doing work, often missing the critical role that products, services, and organizational intent play in composing our social fabric. To this end, we believe that the Gospel’s relevance to the marketplace — and to the world of social impact — is increasingly what Peter Thiel describes as a secret, “an important truth [that] very few people agree with you on.” As 1 Corinthians 2 states incredibly: “We have the mind of Christ.” This creates significant opportunities to create new ventures that accomplish our greater mission at Praxis: to proclaim Christ in culture through entrepreneurship.

Among a wide variety of potential pursuits, consider just the opportunities in just these scarcely-discussed themes:

The Reeducation of Desire (Images)
Iconic Virtue-Driven Brands (Identity)
Mass Distribution of the Best of Culture (Access)
Environments for Flourishing (Places)
Renewing Cultural Shame (Dignity)
Experiential Social Enterprise (Relationships)
The Restoration of Discourse (Civility)
Liturgies for the Common Good (Practices)
Co-Creation for Opportunity (Equity)

This type of venture origination work in the Venture Lab, combined with our acceleration and undergraduate work, all within our growing community, sets the stage for a new positioning of Praxis that is less about the “how & what” of programs and more about the way we function and execute:

Our opportunity is to build Praxis into an entrepreneurial think-tank armed with a transformational worldview, a team of creative entrepreneurs, and a base of capital, all within a collaborative community.

With a growing team of “brilliant people who care,” a new entrepreneur-in-residence program for co-founding new ventures, our accelerator and the formation of the Praxis Venture Lab, we would have the ability to create and shepherd the core intent of each of these “new institutions” that Hunter describes while providing our strongest chance at organizational sustainability and growth.

To emphasize the need for this, it is a core conviction of mine that we collectively suffer from a lack of imagination for what theology & entrepreneurship could look like when intertwined at the deepest levels. The systems and norms of culture have moved — and are moving — too fast for our current pedagogies and models; as Christian entrepreneurs we haven’t found our way to a rich theological expression amidst the world of modern marketing, branding, technology, venture capital, supply chains, and more. Meanwhile, the cultural critics, anthropologists, psychologists, and more have been telling us for decades how our Western culture and broader world is in crisis. We hope to demonstrate how the Gospel comes to live in the world to provide a different world.

Designing a Studio — the Praxis Venture Lab

The studio will be focused on two elements:

  • Imagination: opportunity identification & cultural thesis development
  • Implementation: co-founding ventures with Entrepreneurs-in-Residence

Imagination
Ideas matter. This innovation arm of the studio is an application-oriented think tank that identifies opportunities through theological and cultural exegesis. Alongside a community of entrepreneurs, we think, read, and research across disciplines with the distinct purpose of discovering opportunities for Gospel-centric cultural renewal. This work is done with the guidance of a small group of Praxis Scholars, a team of intellectuals that help us bring theological and cultural insight into our work.

As founders of Notation Capital recently wrote:

As the next wave of founders and startups get going, there’s a desire for creative freedom, space, and the time to be thoughtful about which problems are worth tackling. There’s a recognition that many of the most important companies today are driven by strong missions.

This foundational imagination work is the “special sauce” of the studio. We’ll develop cultural theses, opportunity themes, and specific concepts that create a fertile soil for venture creation. Our nonprofit structure affords us — with discipline and constraint — the ability and time to think before acting under traditional market pressures, while pursuing concepts across sectors.

Implementation
As with any startup studio, implementation is the primary activity and responsibility. Here, the Praxis team works with Entrepreneurs-In-Residence (EIRs) to co-found and launch new ventures into the world. This arm of the studio leverages, among other things, an approach and process developed at the world’s top innovation firm, IDEO. As part of that process, Praxis assists with everything from brand creation to market research to business model design. To pull off our cross-sector approach — much as IDEO has done — we will work in close relationship with best-in-class service providers that include marketing experts, graphic designers, technologists, architects, writers, and more. We’ll pursue opportunities to do venture formation around the most important ideas and opportunities, from scalable businesses to innovative nonprofits.

Within our community, we have an incredible opportunity to build a dynamic nexus of Partners, entrepreneurs, and thinkers where, as Erwin McManus has said, the “Church [can become] the human incubator for the world’s best future.”

A Picture of the Future

Imagine this: The year is 2025, and we’re halfway into our 30-year vision for Praxis. Our ecosystem of support for Christian entrepreneurs is healthy, vibrant, and growing. Through the Accelerators, 312 organizations have been served, with a global impact across every major continent. Many of these leaders have come back to become EIRs in the Venture Lab. Praxis Academy students — of which there are over 2000 alumni — are now approaching 30 years old; several have participated in the Accelerator and dozens are working for Venture Lab companies and Accelerator alumni.

Our team of 50 world-class Venture Partners located throughout the globe have created a dynamically connected community, finding and resourcing new ventures, EIRs, and investors across the country and the world, acting as global advocates for the transforming vision of the Gospel in the field of entrepreneurship.

The Venture Lab has become the go-to place for spiritually serious, high capacity Christian entrepreneurs looking to launch a new organization. This year alone, the ten Praxis Partners work with a dozen idea entrepreneurs to originate and launch everything from a media company focused on civil discourse to a customer-centric real estate brokerage to a scalable international nonprofit elementary school focused on virtue and character development. Over 60 ventures in total have been launched into market.

Collectively, the organization is regarded as a primary resource for Christians seeking to understand the purposes and potential of our entrepreneurial imagination, as creators made in the image of God, with hundreds of thousands of entrepreneurs consuming our resources and ideas each year.

At that point, halfway into our 30-year organizational vision, the Praxis team’s contributions to cultural and theological insight through venture building have considerable traction in the shaping of the Spirit of the Age.

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While we don’t want to overstate where Praxis is — we are still quite small and mostly unknown — we actually find ourselves in a reasonable situation to try something as challenging, complex, and audacious as all of this: we have increasing access to capital sources, entrepreneurial talent, cross-sector partners and mentors, and even trend identification through the variety of ventures we are exposed to.

With favor from God and execution with wisdom and excellence, we believe this future is within our grasp, and we’re thrilled to have the chance to build it together with you.

Dave Blanchard
12/2015