“ The Beauty of Social Enterprise” Words of Wisdom With Carla Javits

“The beauty of social enterprise is that it very deliberately takes on two sides of the equation: social change and a business model. Historically, it was seen as crass and insensitive for nonprofits to talk about or focus on how to generate revenue and organize their business in order to address a social problem. And for- profits should, as Milton Friedman emphasized, maximize profits and let government and others deal with the “negative externalities.”
I had the pleasure of interviewing Carla Javits, the CEO of the Roberts Enterprise Development Fund (REDF), a pioneering venture philanthropy that creates jobs and transforms lives like no other organization in America. REDF is distinctive as the only philanthropy in the United States that invests exclusively in social enterprises focused on employment. And they have one mission — jobs — for millions of people who cannot get work because of histories of homelessness, incarceration, mental health issues, substance abuse or limited education.

Thank you so much for doing this with us! What is your “backstory”?

I grew up in New York City in the 1960’s when the city was both a magical place, and also filled with challenges like street crime and the heroin epidemic. Because my father represented New York in the U.S. Senate and both of my parents had grown up poor in New York., I was raised to feel a sense of responsibility and possibility about these issues. My dad would tell me about mothers coming to his office in desperation about their heroin-addicted children. I grew up licking envelopes for my father’s campaigns, and participating in demonstrations. After I moved to California in the 1970’s, I continued to be involved in civil rights and, as I look back, in social enterprise. I was on the staff of one of the first women’s bookstores, which was in Oakland. It sold books that were not otherwise available, while earning money that allowed it to also operate a women’s community center and provide space to a burgeoning publisher of women’s literature. Later, I worked in regular businesses, as a waitress and catering manager, got a Hotel and Restaurant degree at San Francisco City College; and then, realizing social change was what I really wanted to do, I got a degree in public policy. I went to work for the state of California, and later the city of San Francisco, focusing on poverty issues. And then for 16 years, I helped the Corporation for Supportive Housing grow into a powerful national organization investing in housing for homeless people. Finally, I came to REDF in 2006. I thought housing and jobs were the core of providing opportunity. On a personal note, I had two beautiful kids, and was able to marry my long-time partner when same-sex marriage was legalized.

Can you tell me about the most interesting projects you are working on now?

One of the most interesting projects I’m working on is helping the REDF team to facilitate a set of partnerships between the government and private sector to get them to work together in a very practical way. There’s no single way to help people who face big challenges go to work, but it can be done when we work together. When I worked in government, we could see that programs and sectors were completely siloed from one another and therefore the people being served only received piecemeal support. They often could not move forward. Some businesses did a good job building housing. Some nonprofits were good at street outreach. Some employers were good at preparing people for work. Meanwhile, the private sector and philanthropy often came to meet with me to find out what was happening in the community as it was hard for them to understand who did what, who was effective, and how to contribute in a useful way. The idea we have is to make it possible for people overcoming the greatest barriers to get jobs, keep jobs, and build a better life by developing a seamless continuum that is employer- based from start to finish. In Los Angeles, we’ve brought together 14 social enterprises and human service agencies with several government programs and private sector employers to provide jobs, training and support to 1,500 people who have been homeless or incarcerated. Building on that success to date, we are shaping a similar initiative in the San Francisco Bay Area and in Seattle.

So tell me a bit more about your organization?

REDF, or the Roberts Enterprise Development Fund, provides money and business know-how to social enterprises so they can grow and become sustainable businesses that hire people who want to work, but would otherwise be shut out of the workforce because of their backgrounds. These might be young people who have had little work experience in their lives, or even in their families or neighborhoods. It may be adults who have run into really hard times and have been incarcerated or had to deal with periods of homelessness.

We call these businesses “employment social enterprises.” They provide not just training and experience that employers are looking for and a job with a paycheck, but also skill- building and support — like help with housing, health issues, childcare or money management — that help people striving to improve their lives get ready to succeed in the workforce.

These are all real-world businesses making money. They take their profits and pour it back into helping their employees. The customers get great products or services, the companies make money, and most importantly, the employees start turning their lives around.

Like a venture capital firm, we provide some of the capital needed to grow the business, and we pair that with specialized advisory services. For example, we might help a social enterprise develop a plan for a new line of business, or assess their market to help them price their products or services competitively. And on the people side, we might help them better understand the effects of a traumatic life experience on the people they serve, and how to effectively manage and coach employees with that kind of background.

Can you tell me a story about a person that you helped?

A young woman in the Chicago area was born to a mother addicted to heroin and as a child had to take methadone until she was 8 years old to block the cravings. She started using drugs and alcohol at 10- years- old to escape. She experienced abuse — not just in the streets, but at home — by family members. She continued the cycle of drug use, violence and poverty, and lost her own child to the foster care system. Just before her 30th birthday, she hit rock bottom, in jail. Finally, she entered a halfway house, where for the first time, she got sober. She hung on to sobriety, because that opened a door to something unimaginable throughout her life. A job and a paycheck, and a whole lot more. She got a job in a social enterprise, and became part of a team who offered unwavering support for her and her sobriety. Managers aimed for her development as a whole person — something she never had before. Now she is working full-time, with a chance to reconnect with her child and be the contributor and the mother she wants to be.

This obviously is not easy work. What drives you?

The basics. I am driven to do more every time I walk to work and see someone living in the street with all of the indignity and misery that accompanies homelessness. I am driven to do more every time I meet a kind, talented individual who has come to grips with his or her past and changed, but because they were incarcerated can’t get a job. Every time I read in the newspapers of a young person cut down by violence in the prime of life. Every time I hear from a friend about their brother or sister’s life stunted by addiction and mental illness.

I can relax in a safe and pleasant environment at home. I have a job where I feel my contributions are valued and I am treated with respect. My children had a good education, and are on track to do meaningful, decently-compensated work. When I’m sick, I can get care. When I’m struggling, I can get support from my network.

We talk about justice and equity, but at the end of the day, it’s about the basics. The opportunity for everyone to create a decent life for ourselves and our families. To feel that our contributions are valuable and our dignity as humans is respected.

REDF is about creating more of those opportunities for more people to share their talent and humanity. It is a joy and a privilege to do this work.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are?

Yes. An extraordinary colleague I met in the 1980’s named Julia Lopez. At the time we both worked for the California State Legislature. She hired me to work for her when she went to lead the San Francisco Human Services Agency, and later connected me to the Corporation for Supportive Housing where I worked for 16 years, and later on to REDF where I’ve been for 11 years. She believed in my potential, and has been incredibly generous in sharing her candid insights and perspective on all kinds of issues with me for decades. She has modeled the best kind of professionalism with her commitment to using data to inform decisions, while paying attention to the human element, racial equity, and the complexity and long-term nature of this work. And always urging attention to people who have faced the biggest challenges. Everyone could benefit from a “Julia” in their lives, and I feel very fortunate that she has been part of mine.

What are your “5 things I wish someone told me when I first started” and why. (Please share a story or example for each.)

The team. Establishing the right team is critical, but it is not just about brilliant, talented individuals. It’s about people meshing with the mission, and their colleagues. I have had the good fortune to work with many amazing people who have contributed a lot. The times we have made the most progress are when I’ve worked with a group that is diverse across race, class, gender, while motivated by the same vision, trusting one another, and enjoying on a personal level interacting with each other. That’s where REDF is right now. It’s the one reason I’m so optimistic about the progress we’ll make.

Results. Start with the results. Figure out what you’re trying to get done. Figure out how to measure if you’re getting there. From there, decide what you’re actually going to do. When I was at the Corporation for Supportive Housing, we had the nerve to set out what we thought was a really audacious goal — creating 100,000 affordable apartments with supportive services for homeless people. Publicly defining that goal led to a National Press Club announcement by five leading foundations, who committed $50 million to reaching that objective, which resulted in years of good work that affected far more than 100,000 people. We’re applying that kind of thinking at REDF now.

Time. Change takes time. Nonprofits, businesses, government agencies, individual people and our culture all embody a sort of DNA. It is devilishly hard to change once it’s set in place. To move the needle on poverty, and huge problems of that kind, in a substantive and lasting way, takes a really long time — not a few years — decades! It requires courage. And it requires tenacity. The cultural and institutional backdrop of racism, and other ‘isms’ has a profound impact that are too often underestimated. We have to take all of that on to make real change, and that takes time — and a lot of partners.

Social enterprise. The beauty of social enterprise is that it very deliberately takes on two sides of the equation: social change and a business model. Historically, it was seen as crass and insensitive for nonprofits to talk about or focus on how to generate revenue and organize their business in order to address a social problem. And for- profits should, as Milton Friedman emphasized, maximize profits and let government and others deal with the “negative externalities.”

The beauty of social enterprise is in challenging this orthodoxy on both sides. As it turns out, when nonprofits are clear about their revenue needs, and pay attention to generating that revenue sustainably, while setting up their “business” approach to achieve and measure their performance against clear objectives, they accomplish a lot more. And it turns out that when for- profits integrate social concerns — from who they hire to how they treat their employees to the social and environmental impact of the products they sell — they actually beat the competition.

This kind of cross-sector effort social enterprise embodies is essential. Social enterprise is a great vehicle for solving big problems, and will grow and thrive over the coming years as millennials come into leadership, because they embrace the idea of a “double bottom line’” in a way that my generation has not.

It’s personal. If you take on big issues in any kind of public way, you will be personally attacked. Withstanding that, staying open to learning, and persisting are essential skills. Everyone does that differently. When I first started working for the City of San Francisco in the 1980’s, a group of families who had been homeless marched into our building, rightfully furious at the conditions in the city-funded apartment buildings they lived in. Rats and roaches in a big glass bottle set on the stage of our agency’s meeting room told the tale. Their wrath was directed at me and my colleagues. There were many incidents like this that left me in tears daily. Over time, I learned it was not about me personally, and it did no one any good to dwell on feelings of inadequacy and hurt. Better to channel those feelings into action. We visited the buildings, cleaned up the programs, and put our energy into solving problems.

Some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see just see this. :-)

Oprah Winfrey. I would have said the same even before the Golden Globes speech. She is a brilliant communicator who gets big things done. A rare leader who is all about motivating us to reach our highest potential as individuals, and as members of the larger civic family. She knows how to drive culture change. She is courageous, takes risks professionally and succeeds in so many areas. I have followed with respect and excitement her recent foray into journalism with 60 Minutes, the Leadership Academy for Girls she started in Africa, the unbelievable impact of Oprah’s Book Club, and last but not least, the public sessions she has been facilitating to engage people with very different political perspectives in frank, respectful conversations about their differences. I’d love to get her insights into what I can do as REDF’s leader to galvanize action to create a much more inclusive economy where employers embrace the potential of people whose life trajectories have been hard and whose opportunities are thus limited, depriving us all of their talent and contributions.

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