National Office Blog

While filling out my registration for the North Carolina Council for Entrepreneurial Development's 2008 Entrepreneurial Excellence Awards, I was asked to indicate the type of Company/Organization that I work for.

Most people in my situation would find this easy.  They'd scroll down to "Non-profit/Trade Association" and move on with their registration.  For me, however, this brought up a question about how Nourish International identifies itself.

The question revolves around the term "non-profit."  CEDNC is not unique in referring to organizations like Nourish as non-profit entities.  Most notably, the IRS uses non-profit as a tax designation for organizations that emphasizes providing a social return on investment above or instead of an economic return.

By any measure, Nourish falls within this category.  Our mission revolves around identifying and supporting solutions to an issue (Global Poverty), not profitability.  From that frame of reference, it's not incorrect to call us a non-profit.

But it's not exactly correct, either.  Shouldn't Nourish be defined by the things we do (attempting to solve a social problem) instead of the things we don't do (seek a profit)?  Some organizations, like Ashoka have responded to this by referring to themselves as "Citzen Sector" organizations instead of the traditional "non-profit." (You can read about Ashoka's reasoning here and here).

The benefit to this idea is that it accentuates a business savvy mindset frequently overlooked in the term "non-profit," but it also has a distinct disadvantage -- it's one more aspect of an organization that potential supporters have to be educated on.

One of the things that many "non-profits" or "citizen sector organizations" seek to do is educate their supporters.  They work hard to show people how giving money, time or energy can tangibly solve a social problem.  In the process, they educate their supporters on a social problem and potential solutions.  Since "citizen sector organization" isn't the commonly accepted term, it creates another point that supporters need to be aligned with.

For an organization like Ashoka that includes the creation of an entrepreneurial, competitive citizen sector as a part of their mission, labeling themselves as a citizen sector organization makes sense.  It's impossible for someone to truly support their mission without understanding the concept of a citizen sector.

For Nourish, however, the creation of a citizen sector is less critical to our mission.  While a vibrant global citizen sector is what makes Nourish possible, our supporters don't necessarily need to be sold on it to get involved with what we do; it's infinitely more important that they are sold on supporting grassroots solutions to global poverty.

CEDNC, on the other hand, might want to pay attention.  Their mission statement is "to identify, enable and promote high growth, high impact companies and to accelerate the entrepreneurial culture of the Research Triangle and North Carolina."  Nothing in this mission statement explicitly states that organizations should be for-profit focused.  One of their awards -- the Community Impact Award -- even seeks to reward organizations like Nourish or Ashoka for applying business concepts to social problems.  But this open-minded view of entrepreneurship is undermined by categorizing organizations as various types of for-profit companies and everybody else ("Non-profit/Trade Association").

James's Note: Upon completing this post, I changed Nourish's designation to Entrepreneurial Start-up Company.  I guess that makes us a Citizen Sector Organization, after all.