Altruistic startups put social entrepreneurship on the map in Atlanta | Crain's Atlanta

Altruistic startups put social entrepreneurship on the map in Atlanta

Matt and his wife, Lisa, launched apparel company Moshyn in October to help provide gym clothes to underprivileged children in Atlanta. For every shirt they company sells, Moshyn donates a gym outfit.

Mathew Moore’s path into social entrepreneurship began after his parents divorced when he was in sixth grade.

Moore’s father left town and his mother couldn't take care of him, he said. Growing up in Lincoln, Neb., he was poor and had no place to go.

A teacher took him into her family, and that changed his life forever, he said. He went on to graduate from college, earn an MBA in international business and work his way up the corporate ladder.

“I have no idea where I’d be without that empowerment,” Moore said of his new family.

Since then, he has sought a way to give to underprivileged children something like the opportunity he got as a child. That's a big part of the mission behind Moshyn, the apparel company he founded with his wife, Lisa, this October, which devotes a portion of proceeds to providing gym clothes for underprivileged kids. 

Such social entrepreneurship has become increasingly common in Atlanta’s startup community. It’s so common, in fact, that a group of nonprofit executives, investors, educators, and entrepreneurs launched an effort the same month as Moshyn began, to map the sector’s market size and potential investment opportunities.

The Georgia Social Impact Collaborative is in the early stages of collecting data and doesn’t yet have a website, but hopes to launch by Feb. 1, according to Chris Allers, a consultant for the collaborative and partner with Advantage Consulting. Funding for the effort is coming from 21 nonprofit foundations, funds, individuals, companies and venture firms. 

“This group is trying to show investors there are opportunities to invest in,” said Dorottya Pap, assistant director of Georgia Tech’s Institute for Leadership and Entrepreneurship and a member of the collaborative group’s advisory committee. 

The goal of a social entrepreneur is to make a positive impact on society, according to the Schwab Foundation for Social Entrepreneurship, and may involve a for-profit, nonprofit or hybrid model. For that reason, “investors grapple with how to define success," Pap noted, which can make attracting investment a particular challenge for social entrepreneurs.

Pap said social enterprises don’t have the same metrics as a typical startup to show to potential investors, return on investment being the biggest.

“A lot of startups require patient capital investment when you’re not looking at a three-year return,” Pap said. “Most of the time, it’s not going to be market rate.”

While it may be challenging, social enterprises do attract investment. Acivilate, for example, a four-year-old startup at Georgia Tech’s Advanced Technology Development Center, landed $3 million in funding this November, in a round lead by BIP Capital in Buckhead.  

The company, which helps former inmates acclimate to life after incarceration through a mobile application named Pokket, had to build a track record before attracting the investment.

“We did our own angel round,” said Louise Wasilewski, Acivilate’s chief executive officer and co-founder.

Like Moshyn, the idea for Acivilate grew out of personal experience. Wasilewski, who said she grew up with a father who had a criminal record and couldn't get regular employment, remembers experiencing the economic and social consequences firsthand.

“People didn’t think I’d succeed,” said Wasilewski, who went on to become an aerospace engineer and earn multiple patents.

The idea behind Acivilate was to create second chances for people like her father. And the market for that help is big. According to the U.S. Department of Justice’s National Institute of Justice, more than two thirds of prisoners return to prison within three years of being released.

The goal of the technology is to help people plan and track a successful parole period to break the cycle. Pokket helps former inmates track meetings with caseworkers, look for jobs and manage their time once they have a job. The app is also designed to issue early warning signs if a user is struggling.

Wasilewski said the initial perception was that judicial system would be resistant to the idea.

“But they are the ones who bear the cost of the recidivism,” she said.

A year ago, Acivilate and Kennesaw State University Assistant Professor Tanja Link landed a grant from the Georgia Research Alliance on a project to reduce recidivism in Gwinnett County. That, in turn, helped the startup secure a pilot project with the Utah Department of Corrections. There, inmates are issued tablets before they leave prison so they can begin preparing for the transition. They keep the tablets once they are released.

BIP Capital saw Acivilate’s economic viability with the Utah win and the partnership with the KSU professor, according to Paul Laffaldano, the venture capital firm’s managing director.

“We don’t use a different yardstick,” Laffaldano said of how social enterprises are viewed for investment. “For us, this is a business. It is a for-profit concern.”

Moshyn’s Moore plan, meanwhile, is to continue to bootstrap he and his wife’s venture. Its model is for-profit, although the goal isn’t necessarily to make money.

“We just don’t want to lose money,” he said.

Proceeds from apparel sales go to their nonprofit foundation, Youth in Moshyn, which donates gym bags of clothes to organizations that help underprivileged children, such as Children’s Restoration Network. Each child who receives gym apparel also receives a small gift they can pass on as a way of paying it forward.

Moore said he drew inspiration for the one-for-one structure from the apparel brand, Toms, which gives a pair of shoes to impoverished children for every pair sold.  

The gym bags idea originated with his adoptive mother, Moore said. She noticed that some of her students didn't participate in gym class because they didn’t have the proper clothing.

“She would buy clothes and go to where they lived,” he said.

According to the Children’s Restoration Network, shelters and group homes house some 3,500 homeless children each night. Moore said Moshyn has worked with more than 100 children since October.

But his goal is bigger than the Atlanta area. The idea is to build here and scale.

“Our goal is a million kids to provide clothes to,” he said.

The Georgia Social Impact Collaborative also hopes to build and scale—by capturing Moshyn, Acivilate and other startups through mapping, and then accelerating their growth.

"Those interested in participating in the mapping process can access a questionnaire that will address their impact investing activities," Allers said.

He said the collaborative hopes to complete the mapping research by April.

January 8, 2018 - 11:24am