I've never really told the story of Sustainable Industries from my own unique perspective before. At least not in full, and at least not in a public forum. At our 10-year anniversary, it seems an appropriate time to do so.
It's a pretty good story too: A small business that has had a significant and immeasurable yet often low-profile impact on the growth of the sustainable business movement – for 10 years inspiring ideas, business innovations and new connections. An entrepreneurial American enterprise that has produced 125 issues of an award-winning magazine, 25 impactful live events, and dozens of webinars, newsletters and case studies. A company that like many of its peers struggled with cashflow through the Great Recession but overcame extraordinary odds to come back on its 10th anniversary with a plan to double down on its mission.
Part of the reason this story hasn't been told in full is because of the ways it always felt like an unfinished plot, or the courage I lacked in telling it in an authentic voice. Every business owner understands the delicacy of their status in the world, and the manner in which factors outside of their control can overwhelm even the best-made plans.
Sustainable Industries is based in the Bay Area, which is surrounded by amazing entrepreneurial success stories. Go to any networking event and ask a young, dapper business leader how their new venture is fairing, even in the midst of the worst economic climate since the Great Depression, or even when their eventual demise would seem obvious, and you'll inevitably get the answer: "Great. Outstanding. Blowing up." More spin than a post-presidential debate press hall. To be an entrepreneur you have to possess unbridled and often irrational optimism.
I’m an optimist and a risk-taker, and I admit falling into the trap of over-glorification from time to time. But even if you don’t always get to see under the hood, most everyday entrepreneurs can’t lie with the deftness of, say, politicians. I think you can often see the real truth in their eyes.
Certainly in this entrepreneurial climate you have to Botox your financial projections and wheel out the smoke machines and full-length mirrors to capture angel investment or more heavy-handed venture capital investment. Most people would be more than thrilled to see a predictable return on an investment of 20, 25 or 30 percent, but that's not ambitious enough for most of the investment community. They know well that only a small fraction of their investments will be the next Twitter-meets-iPod-meets-Airbnb, and that more than pays for all that fall flat. When you see some of the crap that gets funded, you understand this can be more art than science. Thank goodness for the long-overdue advent of legitimate crowdfunding!
Unfortunately, by not pulling back the smoke and mirrors we miss out on some of the "real" stories we could all learn a lot from. After all, not everyone gets to be Mark Zuckerberg. Not everyone wants to be Mark Zuckerberg, either. Incredible entrepreneurial success at any means possible may bring about timely innovations, great financial comfort, and even the illusion of power. We celebrate that doggedness and disruption. There are some breakthrough companies that create meaningful change, others that manufacture nice-to-have consumer products (usually overseas), and others that seem to do little more than gin cash. Then you have the billionaire hedge fund managers on Park Avenue that can write their own rules and even get bailed out by taxpayers when they muck it up.
In this day and age, is it possible to achieve a relative measure of success in a truly mission-driven business without compromising your integrity? Can you do it fighting the good fight? Fortunately I've met a lot of people through this work that have showed me indeed you can. You can read all about these companies in Sustainable Industries.
There is also risk in telling a “real” story. When your livelihood depends on asking companies for marketing dollars, illuminating cracks in the facade can be, um, counterproductive. It amazes me how much money some media companies ask for relative to what they deliver, but every good salesperson knows when you pitch with confidence and persistence you can make magic happen. Marketers understandably want to put their money on the fastest horses, so a lot of pomp can go a long way.
Yet by not being transparent when the timing is right about your ups and downs – and not telling stakeholders about the deserts you crossed to try and serve them – you can miss out on some critical support. There are more good reasons to open up without over-analyzing what might come of it. In her research into what it takes to live a "wholehearted" life, Brene Brown concludes that "vulnerability is the birthplace of creativity, change and innovation."
One of the many things in the world comical to me is the number of movies – even today – that cast young actors in the romantic role of journalist. The camera pans in with an upbeat pop tune and we find them working in a vast, packed Manhattan newsroom, appearing healthy, smartly dressed and well paid.
There are some notable exceptions, but I don’t think it’s controversial to say that journalism is in many respects a dying profession. The Fourth Estate, which for many decades has done a commendable job of holding powers that be accountable, is largely in foreclosure.
I am not nostalgic about this romantic notion of journalist, or of all the smug reporters that hide themselves behind a principled notion of objectivity. We at Sustainable Industries work out of The Hub shared office space at Fifth & Mission, in the first few floors of the old San Francisco Chronicle building. Some day I want to go up to the floors above us and see if anyone from the Chronicle is still up there. I picture an older gentleman with a hat that says “Scoop” on it, making calls from a land line, while people in the background are running in and out of a dark room. An ash tray. Maybe a secretary nearby.
Relative to the history of mankind, today’s society is moving at warp speed. Technology is accelerating faster than we can chronicle it. Sociologists no longer talk about the Precautionary Principle. It’s a nice ideal, but it simply does not apply to anything we as a people make endless soft, collective decisions to engage in.
Perhaps it’s in part because we’re bombarded and distracted all day with “media”!
Too much of it is either like junk food that temporarily tickles our fancy, or like comfort food that does little but reinforce our existing beliefs and ideologies. With evolving media technology, it’s now served up before us before we even ask for it. Actual regular allegiance to any one media source is increasingly rare.
Social media is an incredible and powerful tool, no doubt worth more to society than the trouble it can cause. But it also creates so much constant noise. At least we get to see what our cousins in Alatoona ate for dinner each night last week – and wow, they sure do eat well!
Unfortunately, many pundits in popular media avoid asking the most important questions, and when they do those questions are too often loaded toward an agenda or an ego (to see Fox News attack real journalists like Bill Moyers, a guy who actually does ask excellent questions, is especially disheartening).
Looking back at journalism school, this is not how it was supposed to be. I was managing editor of my college newspaper, and I started my career as a reporter writing about sprawl development in the 1990s for the Atlanta Journal-Constitution. (You can bet there was plenty to write about!) By my mid-20s I landed my first front page story and had another picked up by the New York Times Wire Service. In grad school I studied mass communication – the sociology of media – learning all of the evils of a world where technology, money and media combined to propagate distraction and fear. Through it all, and although the eventual demise of the newspaper industry was clear even back then, I vehemently believed in all the potential the profession held.
Lord knows I could have pursued more financially lucrative opportunities. During one brief stint writing at a suburban newspaper (or should I say, writing an entire suburban newspaper), I think my annual pre-tax salary was about $20,000.
At the age of 27 I was hired as a business journalist. I worked as a reporter and columnist for a "local" business journal run by a multinational media conglomerate that actually owned the city’s major daily newspaper as well. At this job, a former editor and mentor instilled in me that the job of a business journalist is to “thin the pack” of those in the business world that were cheating and lying to succeed. I convinced him to let me pioneer a beat in the emerging yet timeless strategy known as sustainability, which at the time was embraced by just a small fraction of the larger U.S. business community. To not freak anyone out, we gave it a more palatable name: the “Energy and Environment” beat.
But when new management was transplanted from corporate headquarters to our journal, the salad days were over. I was told to abandon the sustainability beat and focus instead on stories about corporations in the city that by no coincidence possessed the largest advertising budgets. Staged interviews with conservative business leaders were booked on my behalf, and our reporting staff was told to hand over their Rolodexes so that our contacts could be used as sales leads. Our new publisher – by all accounts a nice man – penned an editorial in our journal proclaiming: "I don't know what the hell a sustainability industry is or why anyone would believe that such an industry would provide jobs and economic growth for our region." (So certain he was, it was worth swearing about.) We did get some good letters from the editor.
One reader wrote: "I'm quite disappointed to learn that your publisher's vision does not include the ... pieces that you write. Frankly, the fact that these issues were covered elevated the [journal] to an intellectual level that went beyond the usual revenue/advertising-driven scene of most media and really aided its credibility, which should prove more lucrative over the long term. I know that I will not be alone in this disappointment."
At about the same time, the Twin Towers were struck by terrorists, inducing a shaken populace to seek comfort. The economy was in turmoil, and we were asked by our leaders to go out and buy things to make it better. An arms race was underway in the SUV market. I lost my sense of integrity in my job, and I was considering getting out of the increasingly dirty media industry altogether. Not knowing what was next, I resigned.
I have always been supremely passionate about independent media. This got me tangled up in a few local controversies.
I had also been volunteering for independent media outlets in my free time. It was fulfilling, but it bothered me that most of the really good media were nonprofit, funded by donations and supported by nonprofit tax breaks. Donate time or money to support it – get a free tote bag.
As a business reporter I believed that sustainability had to succeed in the for-profit world in order to have real impact. Shouldn't independent media do that too? Ultimately, I collaborated with some smart and motivated minds, and Sustainable Industries was born.
Every year over 1 million businesses are launched in the United States. Nearly half fail within the first year. The statistics are much worse for media companies.
Small, local, medium and regional businesses are the lifeblood of a healthy, sustainable economy, creating roughly two-thirds of net new jobs each year. Growing evidence suggests every dollar spent at a locally owned business generates two to four times more economic benefit – measured in income, wealth, jobs, and tax revenue – than a dollar spent at a globally owned business. Other studies suggest local businesses are key to tourism, entrepreneurship, social equality, civil society, charitable giving and revitalized downtowns. Smaller businesses are also more efficient at catalyzing innovation, producing more innovations for dollar of R&D investment than do larger firms.
In launching Sustainable Industries, I was all in. I went for a couple of years without pay, taking out a second mortgage to pay my bills and maintain a steady supply of food, caffeine, and hoppy beer. I worked long hours and I was hard-core about quality control. Hard work was probably the biggest advantage I had over the fact that in some respects I didn’t really know what I was doing.
We grew organically in a challenging and rapidly changing industry, with no outside investment, averaging 30% revenue growth, year after year for our first 7 years. It took 6 of those 7 years for Sustainable Industries to finally break even on top of that growth – and we did it with a mostly clean balance sheet. This was an extraordinary accomplishment from a group of people who were learning by doing.
Our biggest year was 2009, but it was toward the end of that year that the recession finally gave us a good smack. By this time, marketing budgets had been reeled in and a few of our larger clients had disappeared overnight. Like many small businesses, we were confronted with cashflow problems and there were no viable opportunities to access capital. There was no help to be found from mission-driven angel investors or from some of the social investment organizations that Sustainable Industries had supported for years (there is another good story in there, but I’m not petty enough to tell it now). Bottom line: We were served a nice big slice of humble pie.
In those next few very difficult years in the heart of the recession, many entrepreneurs much smarter than me would have closed up shop and said “sorry” to their stakeholders. I toughed it out. And I’m not sharing this to paint myself as a saint. Frankly, there were no easy choices. I made the amateur entrepreneurial mistake several years ago of putting everything I had into Sustainable Industries, and that left me personally holding the bag for a lot its obligations. That’s not how you’re supposed to do it. Sustainable Industries is a story of true “corporate personhood.” Although in the Great Recession, this corporation would not be getting a taxpayer bailout, and its founder had no golden parachute.
There are opportunities in every challenge. Through these tough times I was able to restructure the company to something much more nimble than it was in 2009. We gave up the expensive office space with bamboo flooring in the Financial District. By 2011, Sustainable Industries’ monthly print magazine, which since the beginning we paid a premium to print on 100 percent recycled paper, became bimonthly. By the fall of 2011 it was phased out completely. Until then, the print magazine represented about half of our revenue, and an all-digital magazine was not about to live up to that. The most difficult part, of course, came in the loss of positions I had been so proud to create for employees who sought work that made a difference in the world.
None of the savings came as quickly as I would have liked. But by the summer of 2012, I was personally sleeping easier and felt at this point no challenge big or small could phase Sustainable Industries again – we had seen it all. I took a mini-sabbatical and did some volunteer work. The business no longer felt so tied to my own ego. Critical debts were paid down. Our new custom media offerings make much more sense not only in terms of potential profit margin, but more importantly in terms of the impact and value they offer our clients. Frankly, there’s more fun to be had delivering a custom experience that addresses exactly what businesses are looking for. Print ads aren’t as easy to measure.
As a service-based company, the biggest asset Sustainable Industries possesses is the incredible audience of sustainable business leaders we serve. That audience is alive, well, and more sophisticated than ever.
Outside of the company, the world keeps spinning. Before the recession, the “local” journal-conglomerate I had previously been employed by launched a formidable online sustainable business media property that has commanded major sponsor dollars and in some ways pushed us out of that market entirely. This mainstream media’s push into sustainable business can be seen as a good thing, and it’s quite possible Sustainable Industries played a role in inspiring that.
But the story of who sailed through and who is still rocked by the wake of the recession is similar across most industries. In a recent special report in Foreign Policy magazine called “Who won the Great Recession?” (because it’s more entertaining to crown winners, right?) those on top included the ultra-rich, “climate deniers” and McDonald’s (NYSE: MCD), which saw its stock rise roughly 350 percent since the critical documentary “Super Size Me” was released in 2004.
Much of the Fortune 500 enjoyed a fast and spectacular recovery in the recession, however in the speculative months after their recovery significant investments in the United States have remained rare. Many have turned to Asia, the Middle East and South America. It’s a prudent move for shareholders.
The Fortune 500 is chock full of more great companies than bad apples, and some are truly leading the way in sustainability innovation that has widespread global impact. But according to most green business media today, this is the only sector of the economy worth chronicling, or in some cases just evangelizing. This may be a prudent move for the media companies as well. It’s a lucrative niche to serve. But it also offers some tired B2B platforms, at best churning out limited perspectives, and at worst offering its audience disguised infomercials and paid-for panel spots. There’s nothing wrong with the Fortune 500. It’s just not the only business demographic vital to real sustainability in our economic development picture. I think most people – and especially entrepreneurs – understand that.
As Paul Hawken wrote in response to a series of questions collected at the Nov. 1 Sustainable Industries Economic Forum, “While we have no control over the value of currency, we can control the flow of currency, and that is critically important because it is only by regionalizing capital flows can you create sustainability, and maintain resiliency, redundancy, capacity, job creation, and some semblance of food, energy, and materials security. Sustainability isn’t somewhere else, out there in the cold night. It is right here, next to you.”
Most “sustainable” brands simply can not transcend their system of success – controlling the way our money flows off Main Street and on to Wall Street.
In addition, media content has become a commodity where quantity is often viewed as more essential than quality. This is not how I ever understood the role of B2B. New business media work to cannibalize content they don’t have the gumption or budget to produce themselves. Some headlines are shocking teases that have nothing to do with the actual stories they represent. Others pander to lurid curiosity. Ever find yourself agnostically clicking through articles online and getting distracted by a jarring headline or photo on the sidebar? ("I'll just take a peek for a minute," you think). This is the strategy – to get your click at any cost. I find myself clicking down rabbit holes all the time – me with my master’s degree in mass communication.
Or else we find ourselves flipping through business magazines, oogling at the formulaic cover photos of young business-casual entrepreneurs backed by millions of dollars of VC celebrated as heroes based on ideas that possess negligible social or environmental benefit – much like the covers of fitness magazines that show us the abs we want and sadly will never have.
Sustainable Industries set out to offer another perspective, one that is fiercely independent, void of infomercials, and just as tuned in to the small business and entrepreneur as it is to larger regional companies and the Fortune 500. This is how we set out to differentiate and earn trust with you, our core audience. What Sustainable Industries does best, according to Paul Hawken, is that it “cuts through the fluff.”