Value Added: The Nonprofit Entrepreneur
By Thomas Heath
I have been tweeting on Twitter (my call sign is addedvalueth) for the last two weeks, wondering why a grown-up would share mundane parts of his personal life ("heading to sleep") with complete strangers on the other end of a computer or handheld. And why anyone would want to read aforementioned drivel.
The most substantive discussion I had on this social networking site centered on the merits of Chicago-style deep dish pizza versus the flat, greasy New York pizza.
I wondered what the possible business applications of Twitter could be. While I was wondering, I got a pitch from entrepreneur Scott Beale, who used Twitter, Facebook, Craigslist and a bunch of other Web sites to win $100,000 from online contests to fund his District startup.
The start-up is a non-profit. Don't press the snooze button yet. Beale approached the project as if he were building the next Google.
The 33-year-old Georgetown graduate and former U.S. State Department employee quit his $42,000-a-year Foggy Bottom career three years ago and, using the same Web skills that President Obama used to raise campaign funds, built what he calls a "Peace Corps in reverse."
His creation is Atlas Corps, which lures highly-skilled non-profit decision-makers from India and Colombia to the United States for a year, running Sept. 1 to Aug. 30.
He concentrates on India and Colombia because he speaks the languages and because they have highly-developed non-profit sectors. They also have a high opinion of the United States, Beale said.
He finds U.S. non-profit organizations to host the visitors; the hosts pay $26,000 for the volunteers. The idea is to help the volunteers learn U.S. non-profit management skills. The non-profits hope to learn something from the volunteers as well.
"I'm using entrepreneurial business skills to make a difference in the social sector, which isn't any different from using business skills to make money in the for-profit sector," Beale said.
Atlas keeps $4,000 of the $26,000 to cover its rent and administrative costs. It gives the rest to the Atlas "fellow," which covers a stipend for housing, food and transportation. Atlas covers health care too (at a student rate of $800).
Chief executive Beale and his company live on the cheap. He has five staffers and sublets a tiny, windowless office space near DuPont Circle in the District. (For its first two years, staffers worked out of their own apartments.) Beale collects a salary in the "low $40s" and his five staffers split $120,000 a year. He travels to New York on $25-each-way buses, entertains over coffee and bagels and uses free space at Synergos, another non-profit (sponsored by a Rockefeller heiress) that works in the developing world.
The group currently has 12 fellows in the program, including nine in the Washington area. Atlas also has helped send three Americans to Colombia. When they are finished with the fellowship, participants must return to a nonprofit in their home country.
In addition to the fee Beale collects from host organizations, he has come up with another source of revenue.
This second stream reminds me of the movie about five years ago called "The Prize Winner of Defiance, Ohio," about a 1960s woman who supported her family by winning jingle contests. Beale has entered and won a series of online contests such as AOL mogul Steve Case's America's Giving Challenge and IdeaBlob, which brought in more than $100,000 last year.
The goal of the contests varies, but typically involves amassing the most donations of a certain size or encouraging people to register at a specific site.
To win, Beale contacts old friends from Georgetown and elsewhere, asking them to become captains and contact other friends. The viral network is just like political bundling, where every person you contact in turn contacts five others, and they contact five others, et cetera. To beat the big colleges at the contests, Beale timed his big push for the Christmas break, when students were home relaxing. He asked for money on a YouTube commercial he made featuring his three-year-old nephew.
"During one contest, we had 800 people donate in the last 48 hours. It's just like running a campaign," said Beale, who is working on another $10,000 contest right now.
Beale said the inspiration for his company came from his time in India working for the State Department. He had an idea where people from places like India would come to the United States.
The key hurdle was visas, which allow foreigners to work in the United States but are difficult to get. Beale figured if he could get certified by the State Department to bring non-profit workers into this country under a visa program, he would have a competitive advantage over rivals.
To find people who knew the ins and outs of visas, he advertised for employees on Web sites such as idealist.org and Craiglist.com, listing the job qualifications.
Non-profit fundraising came easy to Beal. He is an extrovert who would routinely throw parties to raise money for charities at his Adams-Morgan apartment back in the early 1990s after graduation. He further developed the non-profit bug while working with Ashoka, a non-profit which sponsors social entrepreneurs. His time in the Clinton White House, where he worked as a liaison with U.S. governors, and for the State Department in India whetted his appetite for using business skills to impact social objectives instead of just turning profits.
In 2006, an attorney friend helped him file the papers with the Internal Revenue Service to create a non-profit. Cost: $500.
To find board members and non-profit sponsors, he tapped a long list of contacts in the non-profit world and from the federal government. Ashoka signed up to pay $17,000 for a fellow the first year.
At the time, Beale had a long commute. Without a job, he was living in Bogota where his wife worked at the U.S. Embassy.
He wooed prospective donors in Washington, where he slept on friends' couches and knocked on non-profit doors. It was a crazy lifestyle. He took his phone calls, whether he was in Bogota or D.C., on a 202-area code telephone link through Vonage.
But the craziness paid off. Beale got $80,000 from Ebay founder Pierre Omidyar and $20,000 from DuPont Corp. to get off the ground.
"I am just like a business entrepreneur, but instead of making a big paycheck I try to make a big impact," he said.
His competitive advantage lies in his certification from the State Department, allowing him to bring in experienced non-profit managers.
At last check, 500 people were applying for this year's 12 positions.
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