Yodomo: a new social (ad)venture
At Yodomo, we’re on a mission to grow participation in crafts and making. Why? Because it’s good for you (engaging in creative projects is proven to boost mood, productivity and focus) and good for the planet (that is to say, through the understanding of how things are made, we can all start to better understand the use and, crucially, re-use of materials).
Our vision since inception has been for a future where people reconnect to the well-being benefits of making with our hands. Where we recognise that everything we make and consume has an impact on us individually, collectively and on the world around us. In an increasingly automated world, we believe that the ability to make and be creative is what makes us human. It encourages positive mental health, increases connection with others and gives a reason for existence.
How crafts and making support wellbeing was well documented before the pandemic, but the numerous lockdowns and isolation of individuals during the Covid-19 outbreak has really brought its well-being properties to the fore.
Last month, Yodomo officially became a social venture. It’s been part of a journey for Yodomo to formalise the ‘why’ of what we do. This post charts that journey but is also designed to communicate to our stakeholders - including our shareholders, our makers, our customers and our wider community - why it is an important step for us.
For Yodomo, becoming a social venture was about formalising our commitment to being a responsible business - whilst reassuring our shareholders that we are equally committed to growing the business. While we had defined our mission, vision and values very early on, we had not embedded these into the organisation in any formal or legal way.
What is a ‘social venture’?
The concept of responsible business is not a new one. Before Covid-19 struck, we already had a full spectrum of social enterprises, the rise and rise of the B-Corp movement, the Zebras were taking on the Unicorns and the concept of ‘having a purpose’ or being a ‘purpose-led business’ was already being adopted by many different companies. To expand on those concepts:
- Certified B Corps are, "a new kind of business that balances purpose and profit. They are legally required to consider the impact of their decisions on their workers, customers, suppliers, community, and the environment. This is a community of leaders, driving a global movement of people using businesses as a force for good." B-Corp is a growing movement and explains that it is ‘at the early stages of one of the most important trends of our lifetime: the growing global movement of people using business as a force for good. This movement is everywhere and has many leaders throughout the world. Some are small businesses; some are multinationals. Some use business to reduce poverty; some to restore the environment. All are creating meaningful work with dignity and purpose.’
- Zebras Unite is ‘a founder-created and founder-led movement.’ It believes, "that everyone has an equal right to imagine and create the future" and is looking "to catalyze the community, capital, and culture for people building businesses that are better for the world."
- In Do Purpose, David Hiett’s book explores how ‘the most important brands in the world make us feel something. They do that because they have something they want to change. And as customers, we want to be part of that change. These companies have a reason to exist over and above making a profit: they have a Purpose. Yes, we love the product they make. But the thing we love most about them is the change they are making. Purpose is an incredibly powerful thing. It provides the strength to fight the impossible. It tells your story, it builds your teams and it defines your culture.’
Profit-making social enterprise has been around for decades, though it’s a commonly-held misunderstanding that social enterprises are usually nonprofits. Social entrepreneurship can range from social ventures such as ours, which are mission-driven but ‘for-profit’ enterprises, right through to ‘not-for-profit’.
Social enterprises: A hybrid spectrum. Source adapted from J. Kingston Venturesome, CAF Venturesome, and European Venture Philanthropy Association (2015).
While this diagram (above) goes some way to help visualise where a company might want to sit on this not-for-profit / for-profit spectrum, it’s still not always straightforward and there is surprisingly little to help companies with the journey of self-identification although tools such as Purposely are looking to help with this.
Has the pandemic solidified a redefining of responsible business?
In Kate Raworth’s book Doughnut Economics (2017) she explored economics from a completely different perspective, intent on not falling back on conventional economic theories such as supply and demand, GDP growth, etc. Raworth wanted to look at humanity’s long-term goals as a whole and consider how the economy needed to be shaped around these goals. The result (illustrated below) was doughnut-shaped.
This book was originally published in 2017 and it’s telling to see how rapidly the world of business is changing, with even the most corporate conglomerates considering new pathways for business in the face of the aftermath of a global pandemic.
The pre-Covid whisper of ‘responsible business’ is now seemingly a global chant. Can the pandemic act as a catalyst to redefine the way business and society sit together for the greater good? The World Economic Forum believes so, suggesting that COVID-19 has been a wake-up call for business: ‘Coronavirus has (...) accelerated significant shifts in the complex relations between business and society, underscoring the need for a transformation towards a more inclusive form of capitalism.’
It goes on to say that, ‘businesses will be expected to re-engineer the way they operate to build trust, create value for society at large and mitigate long-term risks. Customers, financial markets and governments will punish companies that fall short in terms of their social and environmental impact. Those that provide transparent benefits will be rewarded.’
How will companies be held accountable for these new responsibilities and how will legal frameworks balance these responsibilities with existing ones?
Balancing ‘Purpose’ with Shareholder Needs
Yodomo joined the Cambridge Social Ventures programme in the Cambridge Centre for Social Innovation at Cambridge Judge Business School. We joined the programme during the pandemic and it was a poignant year to be considering the ‘why’ of what we were doing as the world was seemingly in freefall.
As a limited company, Yodomo still wanted to retain its for-profit model but also wanted to grow the company responsibly. While Facebook’s mission to ‘move fast and break things’ suddenly seems antiquated and destructive, we were keen to ‘move slowly and make things’ but still grow a business.
Crucially we have taken early-stage investment from investors who are looking for a return on investment and we are committed to delivering that return. Yodomo simultaneously wants to grow as a responsible business, and we believe that by having a clear purpose and embedded social mission we are also more likely to succeed. By becoming a social venture it will enable us to more effectively evaluate and measure the impact of our work as we grow.
Our primary goal on the Cambridge Social Ventures programme was to formalise our commitment to grow responsibly, whilst also assuring our commitment to our shareholders of growing the business. It wasn’t enough to suddenly declare ourselves a purpose-led business - we needed to understand what that meant to the business and its many stakeholders.
When looking at the rise of purpose-led businesses, Kate Raworth warns that “just purpose alone is not going to get you there. You can superficially change your purpose by rewriting your mission on your website, you can profoundly change your purpose by having a CEO and a board who are really committed to a transformative purpose…but you have to realign the rest of the design of your organisation.”
As an early-stage business, we understood that embedding a social mission into our Articles of Association now would help us be accountable for responsible growth as we moved forward. We also anticipated that retro-fitting a social mission into our business at a later date could be more challenging.
As part of the Cambridge Social Ventures programme, we completed a questionnaire on the aforementioned Purposely, an excellent tool to help you consider your unique standing as a business on where responsible business stops and starts. Taking you through several questions, it takes you through the steps necessary to create your company articles and embed purpose into the DNA of your business. The final customised articles have been drafted by law firm Bates Wells Braithwaite and can be submitted to Companies House. In our case, before circulating to shareholders we worked with Ignition Law to ensure that everything was embedded properly.
Part of this process has also been to communicate the other positives of being a responsible business to our shareholders. Deloitte reported that “purpose-driven companies witness higher market share gains and grow three times faster on average than their competitors, all while achieving higher workforce and customer satisfaction.” Having a social mission also opens us up to existing and emerging funds for social ventures. We’re now witnessing a global rise in sustainable investing, with several new and emerging funds for purpose-driven tech such as Giant.
Having worked on our mission statement and considered our responsibilities as a business, we were finally in a position to embed our social mission into our Articles and add in a new statement of Responsible Business Principles. Yodomo’s social mission has now been embedded into our Articles, alongside a new set of clauses designed to hold us accountable to run as a responsible business. The physical step of formalising this commitment was really important to use.
As part of our new commitment, we are looking forward to putting the pieces in place to grow the business responsibly, enabling us to fulfil our mission of facilitating wider participation in making and crafts, creating new revenue streams for professional makers and craftspeople and increasing awareness of the benefits of making (well-being and reuse of materials). Our mission also works to meet the targets of the UN’s Sustainable Development Goals, namely Goal 3: Good Health and Wellbeing and Goal 12: Responsible Consumption and Production (Encourage reduce, reuse, recycle at Workplace).
While the process to embed our social mission has taken some months to organise, it feels like our path forward is much clearer now as an organisation. This is just the beginning though and we have a lot of work to do, but we are now happily accountable.
Sophie Rochester, CEO and Founder of Yodomo - a social venture