While the past few decades have focused on global integration, a growing number of innovative entrepreneurs are shaping a new economic model, which directs capital to local communities. The payoffs are huge—regional resilience, local investment options, and decreased use of fossil fuels among them. The obstacles are huge as well. But so is the passion for change. What drives the entrepreneur? In a word, passion. For today’s guests, passions range from solar power to regional food sourcing to economic justice. But underlying every one of the panelist’s missions is the passion for sustaining local communities.
Dan Rosen, founder and CEO of Solar Mosaic, has a passion for energy and the environment, which he sees as “the defining issues of our generation.” When in high school, Rosen wanted to put solar panels on the school’s roof. His passion increased when he visited an Arizona Indian reservation and learned that, while a hundred billion dollars of coal was being extracted from reservation lands, and local water used for transport, the residents had neither power nor running water. “It should be possible for communities to be a part of the wealth created from their resources,” Rosen said. And that was the seed for starting Solar Mosaic. Mosaic is an online platform for people to profitably invest in solar power projects.
For Andrew Swallow, it’s all about food, but with a unique twist. A celebrated chef who has worked in top San Francisco restaurants, Swallow opened Mixt Greens with a mission to use local products in a fast-food model. “One of my biggest passions is to work with the local farms,” he said. When Swallow needed funding to roll the concept nationally, he sold it to a private equity firm; disappointed in the direction the firm was taking, however, Swallow recently repurchased Mixt Greens to set it back on a path of expansion and sustainability. In the meantime, he is starting an angel investment fund to help other entrepreneurs in their own restaurant and food concepts.
According to Michael Shuman, a leading expert on community economics, because 50 percent of our economy is local small business, if we had efficient capital markets, roughly 50 percent of our long-term savings would go to local small business. But it’s not happening. While the problem is fraught with institutional and regulatory issues, Shuman sees emerging innovations for expanding the range of accessible options for entrepreneurs. “In the next couple of years the investment world is going to look fundamentally different.” He suggests that local stock exchanges may be nothing more than bulletin boards.
Rosen added another perspective. “I think we need to look at not just the financial returns, but the community that’s built around these things, the kind of super power that it gives people.” His own customers recently reported that they care less about ROI than about the fact that they’re creating a solar power plant on someone else’s roof. He pointed to the success of Kickstarter, a crowdfunding platform for creative projects, which doesn’t offer any financial return.
Looking toward an optimistic future, Swallow will be launching another unique concept in July—Split Bread—a fast-food restaurant that’s 100 percent seasonal. You can’t have tomatoes all year long, but you’ll love them all the more when you eat them at their peak. He believes that once people hear about what he’s doing, they will want to invest.
And how do these entrepreneurs invest their own money? No surprise: They’re banking on their passions.
– Lucy Sanna
March 23, 2012
Photos by Rikki Ward
The Commonwealth Club of California