Iran, fashion and hybrid social ventures

The new Business Week article on hybrid business models for social benefit discusses an important issue in U.S. law--namely, the need for a legal structure that recognizes social value as a legitimate interest in running a commercial venture.

Still, other news stories today remind us that we should be careful in touting blended value as a "magic" elixir for success.

Women's Wear Daily describes the financial problems facing Gen Art, a hybrid fashion venture that helps emerging designers get their start. For years Gen Art, which consists of a for-profit business and a charitable foundation, have avoided the traditional benefit donation funding strategy in favor of a more entrepreneurial approach centered corporate partnerships.

In recent months, however, revenue from its business partners has ground to a halt, as the financial crisis has devastated the fashion, finance and auto sectors from which it derived its support. Forced to lay off many of its staff, Gen Art is turning to a fundraising benefit to secure the money it needs to survive.

The ongoing protests in Iran also provide a powerful reminder that commerce is not the answer for all social movements. In response to the violent crackdown on mass protests, Iranians are now being encouraged to gather at the Tehran bazaar for the express purpose of *not* buying anything. The aim: to drive social change by shutting down the city's central hub for micro-business.

My general point here is not that social enterprise is bad--far from it. Rather, we need to recognize that the dynamics of social organization are far more complex than any single business model will reflect.