CAVEAT: Recently, we became aware of some federal grant money that would allow us to deliver programs that we presently specialize in for free to schools across Canada. When we read deeper into the requirements needed to qualify for the grant, it was clear it was for “not-for-profit” organizations, and not a small family-based social capital company. The first thing that went through our brain was – “Damn it”!
In recent years, the landscape of social impact has evolved, with an increasing number of for-profit companies adopting social missions alongside traditional for-profit-driven goals. These hybrid companies, known as social capital companies, seek to create positive social change, while maintaining financial responsibility and sustainability. However, accessing funding for such initiatives can be challenging, leading to a reasonable debate about whether for-profit social capital companies should be eligible for not-for-profit grants – presently they are not! We would debate the idea that social capital companies should have the opportunity to access grants traditionally reserved for non-profit organizations.
Traditionally, social impact and profit were seen as mutually exclusive, with non-profit organizations dedicated solely to addressing societal issues. However, a new wave of social capital companies has emerged, driven by a desire to leverage market mechanisms to tackle social challenges especially in today’s onlife world. Social capital companies aim to demonstrate that financial success and social impact can coexist, blurring the lines between for-profit and non-profit models.
The onlife digital literacy and internet safety challenges we face today are complex and multifaceted, requiring innovative solutions that go beyond traditional charity models. For-profit social capital companies are well-positioned to address these challenges by adopting a holistic approach that integrates market-driven strategies with a commitment to social betterment. Granting social capital companies access to not-for-profit grants acknowledges the interconnectedness of economic and social issues, fostering a more comprehensive approach to problem-solving.
By allowing for-profit social capital companies to access not-for-profit grants, there is an opportunity to raise the bar on accountability and transparency within the social impact sector. These companies would need to adhere to rigorous reporting standards, demonstrating the tangible social and environmental outcomes of their initiatives. This level of scrutiny can foster a culture of responsibility, ensuring that profit motives do not overshadow the primary goal of creating positive change.
Granting access to not-for-profit grants would also encourage collaboration between for-profit and non-profit entities. By breaking down the silos that have traditionally separated these sectors, there is a potential for greater innovation, knowledge-sharing, and collective impact especially when it comes to digital literacy and internet safety education. Collaboration can lead to the development of more effective and sustainable solutions that leverage the strengths of both for-profit and non-profit organizations. We would also argue that there could also be a better use of grant money provided.
We have looked at several not-for-profits social media safety and digital literacy organizations in Canada. When we looked at their public-facing financial disclosures:
2022 Organization #1 under 15 employees – Approximately 1 million in grant money. Approximately $1,091,363 wages and benefits, highest paid employee makes $120k – 160k per year
2022 Organization #2 under 70 employees – Approximately 3,147,000 in grant money. Approximately $4,303,671 in wages and benefits and $1,128,095 in professional and consulting fees. The highest paid employee makes 120k – 200k year.
Both organizations also offer training to schools and parent groups as a fee-for-service. Yup – they still charge schools for training.
We contend that an established social capital company can provide digital literacy and internet safety educational programs at a significantly lower cost. With a $500,000 grant, we could offer three programs a day, five days a week over an entire school year at no cost to schools across Canada—that’s right, completely FREE!
As the boundaries between for-profit and non-profit organizations continue to blur, it is crucial to re-evaluate how we support initiatives aimed at social change. Allowing for-profit social capital companies to access not-for-profit grants represents a step toward a more inclusive and effective approach to addressing societal challenges in cost effect way. By harnessing the strengths of both profit-driven and charitable models, we can build a more resilient and sustainable foundation for positive social impact.
The evolving landscape of social impact we would argue demands a re-evaluation of funding models to address the complex challenges we face today. The difference between for-profit and not-for-profit organizations is fading, giving rise to innovative entities known as social capital companies. While the eligibility of these for-profit entities for not-for-profit grants may seem unconventional, we believe such eligibility would open the door to a more comprehensive and effective approach to societal issues, especially in the areas of digital literacy and internet safety.
Providing access to such funding encourages accountability, transparency, and collaboration, fostering a culture of responsibility among for-profit social capital companies. The allocation of grant money toward program delivery, rather than primarily covering wages and benefits, ensures a direct and impactful use of resources. As we navigate the blurred boundaries between for-profit and not-for-profit sectors, enabling social capital companies to access not-for-profit grants represents a progressive step toward building a resilient and sustainable foundation for positive social impact in a cost-effective manner.
In recent years, the landscape of social impact has evolved, with an increasing number of for-profit companies adopting social missions alongside traditional profit-driven goals. However, we also understand how this shift raises concerns about the potential misuse of grant money, which is intended to fund programs that create tangible social benefits. Can some for-profit entities exploit these funds to pad their pockets instead of delivering the promised social impact – absolutely. This is particularly troubling when such companies compete with non-profit organizations for limited grant resources.
While social capital companies have the potential to innovate and address complex societal onlife challenges, it is crucial to maintain strict accountability and transparency standards. Grant money should be meticulously tracked to ensure it is used effectively to deliver meaningful programs rather than disproportionately allocated to salaries and administrative costs be it not-for-profit or for-profit organizations. The goal is to foster genuine social change, not to enhance the financial gains of for-profit entities under the guise of social responsibility.
If your company or organization offers grants and is interested in partnering with a social-capital company like the White Hatter, we would love to connect. We are eager to beta test a collaboration that could provide award-winning digital literacy and internet safety presentations to schools across Canada for free.
Digital Food For Thought
The White Hatter
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