Every successful business owner knows that good intentions aren't enough to pay the bills.
So when Tamra Ryan became CEO of the Denver-based Women's Bean Project 13 years ago, she quickly realized the organization had to become a business with a mission instead of a mission that happened to be connected to a business.
Women's Bean Project is a nonprofit that provides women living in poverty with on-the-job training at its food-manufacturing facility. While the women make bean soup mix and other food products, they earn steady paychecks and attend classes focused on building their resumes and learning skills they will need to help them on their way to self-sufficiency.
"We had to be focused on crafting a business with great cost controls, good distribution channels and creating a great product," Ryan told me. "When we did that, the mission became stronger as well."
That's one of the messages Ryan will share when she delivers a keynote speech Oct. 3 as part of the Social Enterprise Cincy Summit. The summit kicks off Social Enterprise Week. The week is designed to bring together the region's social enterprises -- operations that work to address problems in the community and use business as a vehicle to do it, said Bill Tucker, executive director of Flywheel Social Enterprise Hub.
Tucker hopes the event can underscore the work that local social enterprises do and the jobs they create. He also hopes it can help educate the public, banks and investors about the value these types of businesses bring to the community.
"We want to make it more mainstream," he told me.
To understand more about how a social enterprise can have staying power and impact, I talked with Ryan about Women's Bean Project and how it has helped hundreds of women over its 27-year history. Here are excerpts from our interview, edited for length and clarity.
Q: How did you get involved in Women's Bean Project 13 years ago?
A: I began as a volunteer. My background is marketing and business development, and I was working for a tech company. I wanted to find a place where I could use my professional skills and give my time.
I served on the sales and marketing committee for six months. When the CEO job came open, I tried to convince one of my friends to apply for it. She finally said, 'If it's so great, why don't you apply?' So I did.
What I loved about the business model was the better the business did, the more women could be served.
Q: The organization started 27 years ago, right, and was affiliated with a homeless shelter?
A: Our founder was volunteering at that homeless shelter. It was formed as its own nonprofit, and she used space at the shelter facility initially.
Q: So a nonprofit can be a social enterprise?
A: We were formed as a nonprofit because at the time, if you wanted to have a mission, regardless of what you were going to do around that mission, it made sense to be a nonprofit organization.
Today, I think what we recognize is that a social enterprise, in its most basic form, is a way to use the marketplace to sell goods and services and do social good to help solve a social problem.
Q: Your website says Women's Bean Project has grown from an annual operating budget of $6,100 to more than $1.7 million. How have you grown over the years?
A: In the early days, we really very much were a mission that happened to be a business. When I arrived 13 years ago, we really had to make a transition to be a business that had a mission.
A big part of that change has been becoming a real consumer packaged good company. We are a food manufacturer at our core. The better that manufacturer does, the more women we can serve. That involved not just better business practices but also changing a whole culture of an organization where everyone understands that sales create jobs.
That change has really led to our increased distribution across the country.
When I started, sales were about $300,000. Today, our annual revenue is $2.2 million, and about 70 percent of that is sales.
When I started, we were perhaps employing 20 women per year. It was not very clearly defined as to when they started and when they were going to leave.
Today, in a year we'll employ about 80 women. Women work for us for six to nine months. During that time, they're working on building their life skills and job readiness skills to transition into the community for a career entry-level job.
We're going to do the best we can to make them great employees so they can go off and be great employees for someone else.
Q: Can you tell me about a typical Women's Bean Project employee?
A: The average age of our employees is 38. She has to have had chronic unemployment, meaning she hasn't had a job longer than a year in her lifetime. She has to live below the federal poverty threshold. She has to be able to lift 50 pounds. That's because a bag of beans is 50 pounds.
She has to have the ability to stand for extended periods of time. And she has to be clean and sober. We do drug tests to hire and periodically.
Q: What are some of the circumstances these women are coming from?
A: Domestic violence, homelessness, addiction, incarceration -- these are all factors that typically have led to chronic unemployment.
It typically is representative of an intergenerational cycle.
We've served multiple generations from the same family. My fear is that 20 years from now, we'll be serving the daughter of the women who we're serving today.
Q: How do you feel Women's Bean Project impacts childhood poverty in particular?
A: I do believe that when you change a mother's life, you change a family's life.
We are trying to ensure that we are teaching the women skills and helping them feel empowered.
That's why we call the job a career entry-level job. There's a lot of thought about what that career is going to look like. We want them to have opportunities for advancement, benefits and be where the employer is going to care if they want to come to work everyday. We want it to be someplace where they can either stay for a long time or use it as a stepping-stone.
That ensures that she maintains stable housing. The benefits help ensure she gets healthy or stays healthy. For the kids, they're watching their mom wake up every day and go to work.
One of the most surprising things to me when I started here, having grown up in a middle-class family, was how many women said to me that when they were growing up, they didn't know anybody who worked.
Q: How many women has Women's Bean Project employed?
A: In the early days, they didn't do a great job of keeping the records.
We've estimated about 950 women have gone through the program. The Women's Bean Project was started by employing two women who stayed indefinitely to 80 a year.
Every woman has an average of three kids. Almost every woman who comes here is a mom.
Q: How many have become self-sufficient?
A: About 70 percent of the women graduate our program, and we have 100 percent job placement. We pay the women $50 every six moths to check in with us.
Over the past two years, at the one-year check-in, 100 percent of the women were still employed. Typically, it's about 85 percent to 90 percent.
That to us is a really important metric.
Q: Do the women who complete your program still need government assistance?
A: They will most likely continue to need some type of support. The self-sufficiency wage in the Denver metro area is $22 an hour for a mom with two children.
Our women don't all have their children living with them. But they're typically going on to $10 or $10.50 an hour. At one year, they're closer to earning $12 or $12.50 an hour. They might still need some support. The difference is they're not reliant on support for every aspect of their lives.
Do I believe that we've entirely solved the problem with the work that we've done? No. But we have started the women on a trajectory that they would not be able to get on otherwise.
Q: How much does Women's Bean Project pay the women while they work there?
A: We pay everyone the same amount -- $8.50 an hour. Minimum wage in Colorado is $8.31. We intentionally try to be just above minimum wage.
We want their next job to pay more. We also provide what I would call non-traditional benefits that make $8.50 an hour more valuable.
We give them paid time off to take care of their basic needs. It's time off that they earn by being at a basic level of attendance. So they get paid time off to go to an appointment for housing or to the doctor.
We also subsidize their public transportation passes. We do firmly believe that they need to have skin in the game.
If they are working toward a GED (General Education Development or General Equivalency Diploma), we will pay them during the time they are working on that up to five hours a week. About half the women we hire don't have a high school diploma or GED.
Q: Has this model been replicated by anyone else?
A: It was replicated in Chicago in about 1996. They shut down a few years ago. I think that was because they didn't get over the hump, getting to the point where they weren't so dependent on grant dollars and donations to actually be able to operate.
Another danger of this "business" -- using air quotes here -- is becoming overly dependent on government funding, workforce development funding and the like. We have consciously made sure that we are not dependent on those funds.
Grants are about 10 percent of out total operating budget. Sales are 70 percent. The remainder is donations.
They're paid for a full-time job, and 70 percent of that paid time is spent working in the business in some way. Then 30 percent of the paid time is spent in program activities.
Q: Why limit this to women? Men could benefit, too, right?
A: It goes back to, when you change a mother's life, you change a family's life. Women are much more likely to be the primary caregivers than men.
I also think women respond uniquely well to a supportive environment. We call it a safe and accepting work environment. It doesn't matter why you've come here. What matters is where you've focused on going.
Q: How hard do you think it would be to start something like this from scratch in a different market?
A: It probably would be harder than when we started. We were founded with a $500 investment and putting two women to work. I think initially the novelty got it a lot of attention. Today it's a bit more crowded of a marketplace.
I think a strong business model with a great product or service -- there's always a place for that.
What we've got to remember is just having a mission doesn't forgive not having a great business model. You still have to have a product that people want to buy.
We intentionally hire the worst workers and make them great workers and send them off to be great workers for someone else. That's a lousy way to run a business.
But I don't think I would do it any other way.
Working in a social enterprise like this requires being comfortable or getting comfortable with the tension that exists between the business and the mission because they often work at cross-purposes.
I think it's worth it. And I also think it is one of the more challenging ways to be in the business world.
But if it were easy, everyone would do it.
More information about Women's Bean Project and a list of the organization's products for sale are available online.
To get more information about the Social Enterprise Cincy Summit, click here.
Lucy May writes about the people, places and issues that define our region – to celebrate what makes the Tri-State great and also shine a spotlight on issues we need to address. Childhood poverty is an important focus for her and for WCPO. To read more stories about childhood poverty, to go www.wcpo.com/poverty.