Organization promotes social sustainability

 

ASSETS explains how businesses should combine economic development and social change.

 

(Photo by Bill Uhrich)

Sustainability in business is a commonly heard phrase to suggest a workplace should encourage environmentally friendly practices.

But the word in its broader definition means that businesses also need to be socially sustainable, said Jonathan Coleman, interim co-executive director of ASSETS, Lancaster.

ASSETS is a non-profit organization focused on transforming communities through businesses which are focused on social change and economic development

Coleman spoke Thursday at a program co-sponsored by Berks Nature and Penn State Berks. The event was held at The Nature Place in Angelica Park.

“We take a holistic view of what sustainability means, and that is being environmentally, socially and economically sustainable,” Coleman said. “We envision an equitable, ethical and prosperous economy that works for everyone. Businesses should play a more vital role in helping economies and ecosystems thrive.”

Coleman said ASSETS has programs which focus on entrepreneurship, as well as resources to help existing businesses grow their impact and sustainability.

Coleman used his home-base of Lancaster as an example of what he called a system failure.

Even though the city has experienced a revitalization of its downtown, it has also seen an increased poverty rate and a need for more businesses which are owned by women and people of color.

“The community has a rising tide, but a rising tide lifts all boats and way too many get stuck in the mud,” Coleman said. “There are negative environmental outcomes of economic success.”

Coleman quoted Larry Fink, CEO of BlackRock, an American investment management corporation, who wrote a letter to his investors saying: “To prosper over time, every company must not only deliver financial performance but also show how it makes a positive contribution to society.”

Coleman said business-as-usual has not worked and that businesses need to think outside of the box.

“We help businesses take high level thought and move it into action,” Coleman said. “Good businesses operate with a triple bottom line of how they can impact profit, people and the planet.”

Craig Dalen, director of impact business strategy at ASSETS, explained that businesses shouldn’t be profiting while the communities around them are failing.

Dalen said companies should seek to be different to have a competitive advantage and cited the example of Patagonia.

“Patagonia differentiates itself from other outdoor retailers who haven’t made a push for an environmental advocacy,” Dalen said. “Brands which create a different narrative in the marketplace will attract values-based customers. Be proactive in your approach; create a niche in your marketplace and tell a different story.”

Dalen said businesses worldwide are taking what is known as a B impact assessment, which is an assessment to look inside business models.

Businesses can take advantage of this free assessment tool by visiting www.bimpactassessment.net/assets.

“We can self-regulate ourselves in order to create more value over time,” Dalen said. “The virtuous part is that business grows and the cycle perpetuates itself.”

“A nature-inspired road map could help you and your business disrupt traditional industries,” Dalen added. “Research shows that businesses which start prioritizing values to its stakeholders start to realize long-term benefits.”

But those values would also include such things as investing in a workforce with barriers or providing incentives to employees that typically leave after a certain amount of time.

“That is investing in a community to tell a different story,” Dalen said.

Coleman said it’s about creating ecosystems for truly sustainable business in the community.

“We want to merge business concepts with social and economic concerns,” Coleman said.

“Lancaster is a city revitalized and we (ASSETS) are cleaning up the messes,” Coleman said. “Reading is a bit behind other cities when it comes to revitalization, so it has an opportunity to do things right from the beginning.”

Coleman said ASSETS would like to become involved with businesses in Berks County to give them tools and resources to create more equitable and sustainable business models.

As boomer owners prepare to sell, a push for workers to buy

 

Your company’s next owner could be sitting in a cubicle down the hall, assembling parts on a factory floor or laboring on a construction site down the street. That, at least, is the hope of a burgeoning movement concerned about what will happen to the thousands of small and mid-sized businesses owned by baby boomers in Central Pennsylvania.

Most, if not all, of those owners will be looking to sell their companies over the next few years.

While many will turn to family members, industry peers or even private equity firms, an effort led by a Lancaster-based nonprofit is hoping owners will at least contemplate handing over the reins to employees.

“Widespread ownership transitions in our community offer us an opportunity to harness the moment to retain local jobs, root wealth locally and maintain a vibrant local economy. Employee ownership structures are a powerful way to do this,” said Craig Dalen, director of impact business strategy at Assets, the nonprofit that is leading the charge to spread awareness about employee ownership.

The nonprofit is describing the wave of anticipated sales as a “silver tsunami.”

At stake is the fate of roughly 11,550 businesses employing nearly 135,000 people in Berks, Dauphin, Lancaster, Lebanon and York counties, the areas covered by Assets, according to data the nonprofit gathered from the most recent U.S. Census survey of small-business owners, taken in 2012. The region’s boomer-owned companies represent $30.87 billion in sales and $4.79 billion in payroll.

 

 

 

 

As it looks to put employee ownership on the menu of exit strategies, Assets is collaborating with local lawyers, advisers and business owners, as well as an Oakland-based nonprofit, Project Equity, that is undertaking similar campaigns in other communities around the country.

Employee ownership remains relatively rare. Out of nearly 6 million companies of all sizes nationwide, just under 7,000 are held by employee stock ownership plans, or ESOPs, one of the most common vehicles for selling a business to its workers, according to the National Center for Employee Ownership. Another 1,000 companies operate under other forms of employee ownership, Project Equity estimates.

Employee ownership is not a fit for every business, its advocates acknowledge. And it is not the only way to preserve local control. Passing a business from a parent to a child or children, for example, also keeps wealth and ownership in a community.

But it is better than simply shutting a company down, which is often the path of least resistance, or selling to a third party from outside the community, said the co-founders of Project Equity, Alison Lingane and Hilary Abell

“Typically that means you’re going to lose at least some portion of the jobs in administrative and back-end operations,” said Lingane, noting that a company’s spending and profits also may leave the community after a sale.

Advocates of employee ownership want to ensure departing owners are rewarded fairly for what often represents their life’s work. But they also hope owners will value other factors besides the final sale price.

“The problem is that many advisers are pushing cash and that becomes a proxy for value,” said Ed Renenger, an attorney and ESOP specialist with Reading-based law firm Stevens & Lee. “In our experience if a business owner receives enough cash consideration to take care of their personal, family and charitable needs, it frees them up to think about other value drivers. There are lots of owners that find value in other things, such as legacy, community and employees.”

A sale to employees often entails risk and complications that don’t arise during a sale to a third party, Renenger and other advisers acknowledged. But the complexity ultimately is no greater than it is for a more typical sale.

“The reality is that the transition of a business to a third party, with the exception of an intergenerational transfer, is a very emotional event for the owner,” Renenger said. “It’s a complicated transaction that involves a detailed examination of current operations, current compliance with the law, current financial statements in ways that may feel very intrusive, and a sale to an ESOP is not unique in that.”

The ESOP, however, creates an opportunity to reward employees and preserve a business owner’s legacy, advocates said. And there are tax benefits, Renenger said. For one, an ESOP is considered a retirement plan, so a company that buys stock for its employees via contributions to an ESOP can use pre-tax dollars to do so, just like it would if it were making contributions to an employee’s 401(k) account.

Employee ownership also dovetails with changing expectations for the workplace, said Roger North, president of North Group Consultants Inc., a Lititz-based leadership consulting firm.

After World War II, workplaces followed a command-and-control approach fashioned along military lines, North said. Employees mostly accepted decisions handed down from above.

People entering the workplace today expect to have greater input into decision-making, he said. An ownership stake, whether held by children or employees, can help sharpen that input.

“My observation would be, if you don’t shift to that way of thinking, particularly over the next 10 to 15 years, you’ll likely be behind your competition,” North said.

 

 

It’s a way of thinking that has become ingrained at business software company Cargas Systems Inc. Employees have owned a growing stake in the company since 1998, said founder and CEO Chip Cargas.

Cargas now owns about 40 percent of the company. About 70 of the firm’s 100 employees hold the remaining 60 percent. Employees have two opportunities a year to buy at least $600 worth of stock. Shareholders help elect the company’s board, but all employees have access to the company’s financial performance and profit-sharing bonuses and other perks.

Cargas may no longer be the majority owner. But, he said, he feels he has a more engaged workforce and a sustainable company where people want to work. They pitch in when times are hard and celebrate when times are good.

“When we started employee ownership, I was 100 percent owner of a small pie,” he said. “Today I’m the 40 percent owner of a much larger pie and 40 percent of that much larger pie dwarfs the 100 percent of the smaller pie.”

The pie, he said, would not have grown as large without the effort and engagement of employee-owners. “Yes, we have a hierarchical organizational structure with titles and whatnot, but the way we operate is so collaborative,” he said.

And Cargas doesn’t have to fret about what will happen to the company when he retires. The succession is already under way, allowing employees to focus on customers.

“We don’t need to be worried about shocks to the system from huge ownership changes,” Cargas said.

 

As they move ahead, Assets and Project Equity plan to do more than raise awareness. Their goal eventually is to conduct feasibility studies for companies interested in employee ownership and to work with them to make it happen. Details are still being worked out, Dalen said.

Project Equity already has undertaken several transitions in the San Francisco area and has been developing studies for companies in western North Carolina, where it is working with a local partner called Industrial Commons, Lingane and Abell said.

The chief risks for retiring business owners include ensuring employees are prepared to become owners, both mentally and financially.

“Most small businesses are looking to rely on key employees who have management potential, who can keep the ship sailing and keep things going,” said Peter Kraybill, an attorney and leader of the corporate practice group at Lancaster County law firm Gibbel Kraybill & Hess LLP.

The key employees also need money to pay for the business. It typically involves a combination of debt and a promise to pay the selling owner over time as the buying employees acquire ever-greater chunks of the company, Kraybill said.

Among the risks is less-than-complete payment to the seller, especially if the new owners stumble during the transition, Kraybill said. The new owners may not buy in at the original rate preferred by the seller, or they may not earn the full confidence of customers.

“It’s quite a bit to navigate for an owner,” Kraybill said. “There are a lot of nervous-making moments.”

But, he said, there is a risk when a business is sold to an outside party. A third party could require payments over time instead of in a lump sum, and it may run the company very differently.

“That’s also a risk to a departing owner who very often, particularly for small businesses, has built this as their life work,” Kraybill said.

Increased scrutiny seen to benefit B Corps

Members of the coLAB team, from left Kate Gallagher, Courtney Rinden, Caitlyn Bordon and Bree Gillespie hosted a celebration Nov. 29 to commemorate the company’s certification as a B Corporation. Based at Lancaster coworking space the Candy Factory, coLAB is a consulting firm that helps nonprofits. – (Photo / Amy Spangler)

The owners of The Stroopie Co. didn’t need a label to let customers know they wanted to make more than profits and cookies. But they decided to pursue one anyway.

The business, which bakes and sells crispy Pennsylvania Dutch cinnamon cookies, was founded in 2008 with a mission of providing employment to refugee women. Jennie Groff and her husband, Jonathan, doubled down on that cause when they assumed ownership of the business in 2010, even taking the top prize in The Great Social Enterprise Pitch, a local competition for socially responsible businesses.

The Groffs decided to take the company’s mission one step further by becoming a certified Benefit Corporation. The certification, also known as B Corp certification, comes from B Lab, a Philadelphia-area nonprofit that combs through companies’ operations for evidence of socially and environmentally responsible business practices.

The Stroopie Co. is now one of 56 Pennsylvania businesses to boast B Corp certification. The Groffs see the recognition as a formalization of their for-profit company’s commitment to a cause.

The certification, though, exists outside of any legislative framework and carries no direct legal or financial benefits. And business owners that opt to pursue it have to pay fees based on the size of their company and, in many cases, commit dozens of hours to the application and documentation process. They must also adopt enough B Lab-approved procedures — like offering employees paid time off for volunteering or creating written policies for prioritizing local vendors — to receive the requisite 80 of 200 possible points on B Lab’s assessment.

The commitment needed to pass muster with B Lab — on top of the fact that certification carries no promise of financial benefits — might be why The Stroopie Co. is one of only four midstate businesses that can boast a B Lab seal of approval. Other companies have gained certification over the years but were not recertified, another level of scrutiny to which B Corps have to commit every several years.

The expense in time and resources has not dissuaded the Groffs. Nor has it dissuaded a growing number of other business owners, mostly in Lancaster County, from chasing the B Corp label. At least 70 businesses in and around Lancaster have taken an initial assessment this year, with hopes of either becoming fully certified or at least learning some good business practices from the process.

Many feel that adding an additional layer of scrutiny to their practices is simply the right thing to do.

“These businesses we have in our hands are incredible gifts to nurture and use well,” Jennie Groff said. “This is just one more way we can do that.”

Good for business?

Central Pennsylvania’s other three certified B Corps are consulting firms Work Wisdom LLC and coLab Inc., and painting contractor Two Dudes Painting Co. All four companies are based in Lancaster.

Leaders at these businesses said they, like Groff, felt that B Corp certification provided an extra layer of authenticity to social and environmental practices they already had in place.

Two Dudes is the oldest and largest of the midstate’s B Corps, with 53 employees and a history dating back to 1987. Company co-founder Peter Barber started pursuing the B Corp certification around early 2016 before receiving the official approval in September of that year.

The biggest hurdle in the certification proved not to be implementing major policy changes, but rather documenting informal practices and principles that already existed, Barber said. The company, for example, had a general preference for local vendors before starting the certification process, but had no written buy-local strategy. It also tried to save energy where it could, but had never formalized a framework for doing so.

“There’s nobody out there that’s going to tell you their business doesn’t care about the community, they don’t care about their workers. Everybody is going to talk the game that they’re doing that kind of stuff,” Barber said. “How do you create very definitive standards?”

Kate Gallagher, CEO of coLab, and Kedren Crosby, president of Work Wisdom, say they had similar experiences.

Both consulting firms were founded specifically for the purpose of creating positive social impact — coLab through consulting services for nonprofits, and Work Wisdom through consulting services for socially responsible organizations. But putting everything into writing, they said, took time.

Crosby estimates the process took her company about four months from start to finish before it received certification this past March. Gallagher’s firm, which was already legally structured as a benefit corporation at the state level, received its certification this November after several months of trying to find time for the process while juggling all of the other obligations that come with running a business.

That’s not to say they did not have to make any changes. Gallagher, for example, added a money-back guarantee into coLab’s contracts — a big step for a consulting firm that might devote months of services to a single client.

Gallagher, Crosby, Barber and Groff all say the process was worth the effort — and not just for the privilege of putting a B Corp certification logo on their websites.

While Two Dudes cannot attribute any increase in business directly to its B Corp certification, Barber said, the process of taking B Lab’s assessments and learning how to formalize certain business practices likely made the company more efficient.

“Has it gotten us more work? I don’t know,” Barber said. “Has it made us more profitable? It may have.”

B Corp certification also adds a layer of formality to a company’s business practice if it ever needs to bring on new investors or sell to a new owner, Groff said.

On top of that advantage, the label has given Stroopie an avenue through which to share its story with other companies looking to make a positive impact in their communities.

“I kind of have a family of other businesses that are working toward similar things,” Groff said.

Lancaster leads the way

All four of the midstate’s B Corps call Lancaster County home. The Lancaster area, in fact, ranks second in the state for total number of B Corps. Only Philadelphia — which hosts 25 — has more.

The nonprofit ASSETS sits at the hub of much of the county’s B Corp buzz. The Lancaster-based organization, which offers business development programs focused on addressing social disparities, has been educating the businesses with which it works about the certification, encouraging them to at least go through B Lab’s initial impact assessment.

The free assessment is catered to businesses based on factors like size and industry and generally takes between one and three hours to complete, according to B Lab. It gives companies a framework through which they can start thinking about ways to improve their social and environmental impact — even if full certification is not in the cards.

The assessment is also a key tenet of B Lab’s Measure What Matters program, which provides guidelines for organizations like ASSETS that want to help businesses find quantifiable, concrete ways to increase their positive social and environmental impact while increasing profits.

ASSETS hopes to see 10 percent of Lancaster County’s 12,000 to 15,000 businesses take the assessment in the next three to five years, said Craig Dalen, a former B Lab employee who now serves as ASSETS’ director of impact business strategy.

Dalen also hopes to see between 120 and 150 businesses go on to gain full B Corp certification.

It is a lofty goal, but one Dalen feels confident Lancaster County’s businesses will meet. The county already has a strong record of corporate responsibility, he said, as evidenced by companies’ contributions to events like The Extraordinary Give, a countywide effort that raised more than $8 million for local charities in November.

Dalen knows the full certification process can feel daunting, both to small business with few resources to spare and large companies with complicated procedures that might take significant time to change. But he feels confident businesses will rise to the challenge — for the sake of both their communities and their own bottom lines.

B Corp versus benefit corporation

Not all B Lab-certified B Corps are legally structured as benefit corporations, and not all benefit corporations are B Lab-certified B Corps.

Business owners can structure their companies as benefit corporations or benefit LLCs under Pennsylvania law, in much the same way that they can choose to be S corps, C corps, sole proprietorships or any other kind of business.

Legally defined benefit corporations must submit annual reports to shareholders outlining the ways in which they contributed to the public good. These reports are also shared with the state, making them a matter of public record.

The benefit corporation structure is available only at the state level, and only in certain states. Companies registered as benefit corporations in their home states have to register under different business structures — like LLCs or C corps — at the federal level.

B Lab’s B Corp certification, on the other hand, is a label that has no ties to a business’s legal structure. It is similar to the LEED certification for environmentally friendly buildings in that it is connected not to legal requirements but rather the standards of a non-governmental nonprofit.

B Lab strongly encourages its certified B Corps that are not structured as benefit corporations to pursue becoming one in states that offer the option to do so.

Lancaster B Corps

The Stroopie Co.
Description: Cookie maker with an emphasis on hiring refugees
Number of employees: Seven
Founded: 2008
B Lab-certified: May 2016

Two Dudes Painting Co.
Description: Commercial and residential painting company
Number of employees: 53
Founded: 1987
B Lab-certified: September 2016

Work Wisdom LLC
Description: Consulting firm with a focus on workplace culture
Number of employees: Zero (Six consultants provide services as independent contractors)
Founded: 2015
B Lab-certified: March 2017

coLab Inc.
Description: Consulting firm with a focus on nonprofits
Number of employees: Four
Founded: 2014
B Lab-certified: November 2017

For more information

Business owners can take B Lab’s free impact assessment test at bimpactassessment.net/assets. Creating an account on the site will also put the test taker in touch with ASSETS, which can answer further questions.

ASSETS is also hosting a series of seminars over the next several months focused on socially responsible business practices. More information is available at assetspa.org.

ASSETS works primarily with companies in Lancaster County but is also able to provide guidance and resources to businesses in other parts of the midstate.

Together, we can build an economy that works

Picture a group of 10 Lancaster entrepreneurs starting or growing their businesses. They are a more diverse group than you often see in Lancaster—4 are African American, 3 are white, 2 are Latino and 1 is African. They all have one thing in common: They are entrepreneurs with a dream of improving their lives by starting a business of their own.

You know how risky starting a business can be. Imagine, then, the risk involved in not only being responsible for a loan of your own, but also guaranteeing the loans of 9 other individuals. But that’s what they did. Through ASSETS’ Lending Circle program, entrepreneurs support each other for a full year of business growth. They commit to each other’s success. They improve their credit and access traditional capital. They formalize their businesses and increase their income. They increase the diversity of Lancaster’s economy. And they do it together.

This is the power of ASSETS, which you help to make possible with your financial support.

With your help, ASSETS supports businesses and helps to create thriving wage jobs. Through your generous support, ASSETS helps local businesses be a driving force for good. And it is not just the Lending Circles that are working.

We are:

  • Training social enterprises through the Great Social Enterprise Pitch to hire refugees and people with barriers to employment.
  • Helping women start and grow businesses through the ASSETS Women’s Business Center to achieve parity in business-ownership.
  • Working with existing for-profit companies to Measure What Matters – to consider their social and environmental impact in the community in new ways—through restructuring businesses to offer employee ownership, diversifying leadership and management structures, adding more local women-owned or people-of-color owned businesses to their supply chains, and becoming certified B Corps.

The BBC has called Lancaster “America’s Refugee Capital.” If we can resettle 20x more refugees than any other place in the country, we believe that we can build an economy with the highest rates of women- and people-of-color-owned businesses and the most B Corps per capita. Will you help us work toward this vision?

Together, we can build an economy that works.

Your donation will help us meet our $40,000 fiscal year-end goal and continue to build an economy that works for all. You can give on-line today!

Harvest Moon Bagel Co.: Philly-Style Bagels brought to Lancaster

Chelsea Zawisa has always worked in the food industry. “At times I wondered if I should get a job outside of the food industry, but saw no reason to, I love food.”

In High School, Chelsea worked in various restaurants and bakeries, building a passion for her own cooking. In 2011, she went to YTI for their pastry arts program and began to master baking. Once finished, she worked at bakeries and cafes, including Commonwealth on Queen. During this time, she began to think about owning her own business. “I feel like everyone in the restaurant industry wants to own their own business.” After planning and some research, Happy Belly Bakery was created in 2014.

However, the bakery was only a part-time business and Chelsea would only sell baked goods at the Lancaster East Side Market. An idea began to form inside her mind. For months, Chelsea had visited Philadelphia and saw the success a particular kind of bakery was having: bagel shops. “When we were in Philadelphia, I would walk into every bagel shop I could find and talk with the owners if I could.” After months of research and support from family and friends, Chelsea began planning the transition of her business to solely selling bagels and condiments with a focus on buying fresh, quality ingredients from the Lancaster community. The name would also be changed to the Harvest Moon Bagel Co.

While preparing for this transition, Chelsea knew the ASSETS Learning Circles was a perfect fit for her. While having a great deal of experience within the food industry, she still had only a smattering of experience and knowledge about owning a business. When the first Learning Circles was available, she immediately signed up. She was put into contact with professionals who had real experience and helped her immensely with multiple areas like marketing, the city’s laws, basic accounting, etc. Chelsea found ASSETS itself to be incredibly open and friendly. “I don’t think there is anything like this in many places.”

The owners of Commonwealth on Queen also helped her in starting her business by allowing her to use their oven to bake bagels and also help make the logo for her business. With the support of friends, family, ASSETS and Commonwealth, Chelsea finally officially opened the Harvest Moon Bagel Co. on Sunday, June 26th, 2016.

In the future, Chelsea wants to continue perfecting her bagels and experimenting with different flavors for her butter and cream cheese. She wants to have her own storefront in downtown Lancaster and also have the best bagels in the county while also providing a friendly, community-oriented atmosphere. 

 

Meredith Jorgensen: From Journalist to Entrepreneur

Meredith has, by many journalists standards, had a successful career. After attending Ithaca College, Meredith would land a job with WGAL News 8 in 2003 and has been there ever since. The creation of Life & Legacies, one of her proudest accomplishments, would emerge from one of the most tragic events in her life. The news that her Grandfather and Grandmother were both diagnosed with two different kinds of lung cancer rocked the family.

Meredith, along with her father, raced to Florida with a camera and she asked every question she could think of. “I was afraid that they were going to die and I wasn’t going to know everything I wanted to know.” For two hours, Meredith would learn about her grandparents lives and would have their stories forever. Four months later, her grandmother passed away.

Relieved that she could save their story, Meredith began forming an idea with her good friend Joe Mitton, a cameraman at WGAL. Meredith and Joe wanted to create a business centered around recording the stories of others, helping  their customers create a legacy for friends and family. For seven years, their dream would be just that, a dream. It may have continued to be a dream if Meredith had not learned about the Great Social Enterprise Pitch from WGAL.

Realizing that she and Joe had a great idea for the Pitch, they attended one of the Learning Circles in preparation. Meredith says it was perfect for them. While they had the skills and ability to create their product, Meredith and Joe learned the details of how to run a business through the Learning Circles and the Pitch. “ASSETS was so great about the real nitty-gritty of being a business owner. What is your financial model, how can you make this a viable business? We were able to figure out all of this stuff out at the meetings for the Pitch.”

With a real business plan in place, they were blown away by the support shown by the community when the Pitch began the crowdfunding phase. While Meredith and Joe set the bar at 1,000 dollars, community members in Lancaster donated over 5,000 dollars.

With this money and their own capital, Meredith and Joe opened the doors to Life & Legacies in November 2015. “In seven years, we had done nothing with a great idea. In six months, we took that idea and went from 0 to 60 and finished the Pitch with a fully-formed business.” While running a business is challenging, Life & Legacies is growing faster than they had ever expected. Meredith knew that the business would take a great deal of work to maintain, but she didn’t realize how much it really took until the business was actually started. However, Meredith has loved the challenge and her passion for hearing more stories is what keeps her going. “I just want to interview more people, there’s more stories to tell! The greatest part of my business, is I get to hear all the stories.

Meredith takes great pride in creating the business. “I am a cancer survivor, a wife, a television journalist. And still, opening this business is one of my greatest accomplishments.” For anyone who has a dream or idea, she says “it is very scary, you have to push past the fear, have faith, and be as prepared as possible.” In the end, however, you’re going to have to make a leap of faith.

Eastern Mennonite University Alumni Help Build ASSETS

Jessica King ’96, executive director of ASSETS, visits with The Stroopie Company owner Jennie Groff (right, facing) and two employees, both refugees. (Photo by Jon Styer)

WITH HOLIDAY DEMAND ON THE UPSWING, The Stroopie Company went to two shifts in early November, allowing them to churn out up to 6,000 Dutch stroopwafels (cinnamon-y, carmel-y goodies best enjoyed with a hot beverage) a week. All six workers running the show at the company’s small production facility in Lancaster, Pennsylvania, are refugees: three from Burma and three from Syria. Once a day, they sit down with the store manager, who is also a certified ESL teacher, for a half-hour English lesson.

As a certified B Corporation, The Stroopie Company measures its success by social and environmental standards in addition to the profit column – hence the language classes and $11-an-hour starting wage offered to refugees otherwise facing limited employment prospects. Alone, however, these commitments don’t solve the challenges of solvency and profitability facing any small business. To help meet them, The Stroopie Company has turned to ASSETS, a nonprofit that has worked to create economic opportunity and reduce poverty in and around Lancaster for more than 20 years.

One of the organization’s new programs, says executive director Jessica King ’96, is called the Great Social Enterprise Pitch, which offers a series of business-planning workshops to 10 entrepreneurs who prioritize social and environmental well-being. After the workshops, five participants pitch their ideas to a panel of judges and compete for more than $50,000 in cash and services.

King with Director of Development Tina Campbell ’99 (left) and Finance Director Rosanne Jantzi ’89. (Photo by Tyler Naples)

“It gave us the confidence that we had a great idea going,” says Jennie Groff, one of the company’s owners. “We really feel like we’re poised to grow.”In 2015, The Stroopie Company won the competition, coming away with donated legal services, a free photo session for a new product catalog, and cash that it invested in new equipment.

Lancaster is a welcoming and generous community that resettles more refugees and gives, on average, more to charity than anywhere else in Pennsylvania. By integrating this philanthropic impulse into a workable business model, King says, “impact businesses” like The Stroopie Company are able to fund their own pursuit of a greater good.

“[The Stroopie Company] is a means to an end. The end is about helping their neighbors have better lives,” she says. “There are a lot of ways you can do that. Making cookies is their way of doing that.

“It’s amazing to see the kind of impact that [employers] can have on the lives of people around them, their neighbors and their employees, regardless of what their business is. It’s the spirit of ‘how’ they do it,” King continued. “It might not be all that bright and shiny, but it really matters to people. That’s what really gets me excited.”

Through its various programs, ASSETS provides training and lending to entrepreneurs from underrepresented groups as well as the impact businesses committed to social and environmental goals. During the most recent fiscal year, it supported the creation of 40 new businesses and more than 70 jobs, provided loans or long-term training to more than 150 entrepreneurs, and involved nearly 1,500 businesspeople and community members in other programs and events.

“We believe in the power of business to transform our communities for good,” says Tina Campbell ’99, director of development. “But we are also convinced that it must be equitable transformation – that all races, ethnicities and cultures must be included for true economic development to happen in our own communities.”

According to board member Kevin Ressler ’07, an important part of this vision has been ASSETS’ expanding focus over the past several years to supporting impact businesses in addition to entrepreneurs from underrepresented groups.

“This work breaks down the barriers of ‘us’ and ‘them’ and begins to see that ‘we’ is our only hope moving forward to maintain a country full of communities that don’t just co-exist but co-create and thrive together.”

Since 2008, The Stroopie Company has employed 16 refugee women in its kitchen. Many have used it as both a landing and a launching pad, a welcoming place to build experience and improve their English before moving on to other things. Recently, when a TV news crew stopped by for an interview with one of the Syrian workers, Groff called in an employee who’d just left to provide some translation help. Watching from the sidelines, Groff was struck by the poise and fluency the former employee had developed, at least in part, right there in the stroopwafel kitchen.

“She came here hardly wanting to say anything. To be able to see how she’s leaving us – it just was hugely encouraging,” says Groff. “That is totally what motivates my husband and me. It is just so rewarding to see our refugee employees come in and gain confidence. You can just almost see it happening before your very eyes.”

Top 10 Milestones at ASSETS in 2016

First of all, THANK YOU to everyone who made 2016 a great year for ASSETS. We couldn’t have done this without you. We’d like you to help us celebrate some of our highlighted moments of 2016:

  1. We opened the Women’s Business Center and hired Melisa Baez as the first director of the Center! The Women’s Business Center at ASSETS is developed in partnership with the Small Business Administration to assist small business owners who are starting or expanding their small business.
  2. Two clients became certified B CorpsThe Lancaster Stroopies Company and Two Dudes Painting. B Corps certification is geared towards for-profit companies to meet rigorous standards of social and environmental performance, accountability, and transparency.
  3. ASSETS became a certified SBA Microlender.
  4. We hosted two Cultivate Lancaster events, with a total of over 300 people in attendance.
  5. For our third annual Great Social Enterprise Pitch, we sold out the entire Ware Center!
  6. We launched the ASSETS Business Directory features the businesses of our wonderful clients.
  7. ASSETS is honored to have won the Samaritan Counseling Center Business in Ethics Awards.
  8. Our Director of Programs, Jonathan Coleman, received the Lancaster Chamber of Commerce Young Professional’s Network (YPN) Innovation Award.
  9. Our Director of The Women’s Business Center, Melisa Baez, received MEDA’s “Ten Young Women Changing the World” award.
  10. And….. ASSETS helped over 40 businesses launch!!

Thank you so much to everyone. W wish you a wonderful and prosperous 2017!

 

 

Lancaster poverty report: cut rate in half, move 3,000 to good jobs over 15 years

A special commission that has spent the past year studying ways to help the poor in Lancaster has issued an ambitious, 15-year plan to lift at least half out of poverty and place 3,000 into good-paying jobs.

The Mayor’s Commission to Combat Poverty is also tapping a new, permanent coalition to lead the charge in halving the city’s poverty rate, which at 29 percent exceeds the rates for Philadelphia and Pittsburgh, by 2032.

“Fifteen years and get rid of half of the poverty in Lancaster city? That’s a game change,” Lancaster Mayor Rick Gray said of the commission’s work. “I’m proud of what they did.”

Gray accepted the 87-page report, titled “One Good Job,” at a celebration Thursday night at Tec Centro as the 11-member volunteer panel completed its year-long assignment.

The commission spent $135,618, about half from the Lancaster County Community Foundation.

In its report, made public Thursday night, the commission is asking the newly created Lancaster Coalition to Combat Poverty to:

  • Move 3,000 heads of households to living-wage employment.
  • Make quality pre-kindergarten classes universally available in the city.
  • Help two-thirds of the workforce acquire a post-high school degree or certificate.
  • Create 60 units of affordable housing.
  • Help 100 city families become homeowners.
  • Hire 20 block captains.
  • Establish seven neighborhood groups.

The new coalition is asked to adopt nine strategies and 25 action items. It will oversee a sizable network that includes nonprofits, government and business leaders, and seven action teams, each working on a need such as housing, education or sustainable wages.

Also, a new nonprofit community development corporation will take on housing and workforce development initiatives.

“I think the level of relationship and trust that we’ve built has already changed the game,” said Dan Jurman, commission chair and CEO of the Community Action Partnership. “We’re not strangers to each other any more, and that means something when we start talking about the real work that we’re going to have to do together.”

Funding challenge

Although progress will take money, the report is vague about finances. It asserts that “results will yield funding.”

“The challenge out there is on (potential funders) to embrace the commission’s report and invest in it,” said Carlos Graupera, a commission member and CEO of the Southeast Lancaster-based Spanish American Civic Association. “We can’t be expecting hundreds of millions of dollars to go into the downtown core, and the issues of poverty are to be resolved by selling subs.”

The poverty commission chose not to ask city council or the county commissioners to create a poverty chief or similar position funded by and accountable to elected officials. The new coalition will be accountable to itself and its funders.

Collective impact

Lancaster city poverty by census tract

Chairing the new Coalition to Combat Poverty will be Jennifer Koppel. Koppel said she’ll perform the coalition’s duties in conjunction with her role as executive director of the Lancaster County Coalition to End Homelessness.

“We know that people who live in poverty are at a much higher risk of experiencing homelessness,” said Koppel, who joined the poverty commission midyear to fill a vacancy. “I don’t have an answer as to how much (of my time) it’s going to take. I can’t lose focus on the homeless coalition.”

The new poverty coalition will adopt “collective impact” as its way forward, modeling the approach of the homeless coalition and United Way-funded collaboratives. Collective impact holds that entrenched social problems are best tackled by diverse organizations pulling together toward a shared goal.

The commission says its goals are achievable if “we come together and create broad systems change in a way unprecedented in our community’s history.”

Agencies working together to attack poverty is not a new concept here. For about a decade at the turn of the millennium, five nonprofits formed The Inner City Group to revitalize the South Duke Street corridor, an effort that expired after achieving some headway.

“It was flawed in some areas, but it did some important things,” said Graupera, who headed one of the five cooperating agencies. “It gave us a lot of things to learn from.”

Helping individuals

The commission’s report offers comprehensive detail about how to help individual households overcome barriers to self-sufficiency. It says connecting the poor to living-wage employment “is at the core” of the commission’s recommendations.

The report is less concrete about how to break up the concentration of poverty in Lancaster neighborhoods where more than 40 percent of households live below federal poverty guidelines.

The report, for instance, does not advocate restructuring high-poverty schools or breaking up neighborhoods of public housing that cement hundreds of poor families in Lancaster’s Southeast.

The report, however, does contain a chapter, called “Our Apology,” that acknowledges the toxic consequences of racial segregation and 1960s-era urban renewal housing policies.

“We’ll need your help to push back against these philosophies and policies, and set the south side of the city back on a path toward prosperity,” the report says.

Jobs focus

Commission chair Jurman said the report is titled “One Good Job” for a reason.

“It’s about the difference that one good job makes, not just for the person’s income, but for the amount of time that they can spend with their family and the time that they can get engaged in the community,” Jurman said. “One good job clears up tons of symptoms of poverty that we no longer need nonprofits to artificially supplement.”

Drawing from an antipoverty initiative in Richmond, Virginia, the report recommends creating a workforce development agency that would be a more nimble and flexible alternative to the state-run CareerLink employment office.

The new initiative, for example, would hire “navigators” to work one-on-one with hard-to-hire workers, particularly single mothers, as they seek to overcome training, child care, transportation and other obstacles to employment. The Community Action Partnership already employs seven navigators.

Separately, the Community Action Partnership, working with the High companies and nonprofits, has assembled a crew of hard-to-hire workers into a construction/ landscaping team to work on projects in impoverished neighborhoods.

The workers get on-the-job training, earn living wages and receive social supports such as budgeting classes. Motivated team members can go on to better-paying positions with High or work with the nonprofit ASSETS to start a small business.

“They will earn enough to someday purchase the very homes they’re rehabilitating,” the report says.

Education initiatives include expanding the community school model to more city schools, strengthening after-school programs and aligning curriculum with workforce needs.

No silver bullet

poverty hearing
An audience listens during a poverty commission hearing in June at Bright Side Baptist Church in Lancaster. The commission held four hearings in 2016. JEFF HAWKES | Staff Writer

Tom Baldrige, a commission member and president of the Lancaster Chamber of Commerce & Industry, said he entered the yearlong effort hoping for a unique, game-changing solution, but he learned the problem is too big for a silver bullet.

“What I think this report does is recognize the reality of the hard work and the broad level of engagement that’s going to be required to address the issue,” Baldrige said. “I think the report in that way is much more realistic and in the long term has much more impact.”

Graupera, who brought to the commission’s discussions decades of experience in trying to remake the inner city, said it will take all hands on deck to push the agenda forward.

“Regardless of what happened in the past,” he said, “we need to move forward with investment by schools, public officials, foundations, the private sector, and I think that’s where we need to position this effort.”

The Lancaster County Community Foundation contributed $65,000 to the commission’s work. Franklin & Marshall College gave $59,000 as part of its annual in-lieu-of-taxes payment. The city paid $11,681, said Patrick Hopkins, the city’s business administrator.