Final Post from Michael, Rubicon!

A Summer Intern’s Thoughts on Social Enterprise

Before I became an intern at Rubicon National Social Innovations, I honestly had no idea what social enterprise was or of any organizations that existed. Being only a sophomore in college, my knowledge of social enterprise was limited to the notion that social enterprise somehow uses business skills to try to solve injustices or economic inequities throughout the world. With the little experience I had doing community service in my spare time, I honestly could not distinguish one non-profit from the other in terms of their strategies and approaches to making a social impact. After a phenomenal and memorable 2-month experience with Rubicon National, I am proud to say that I can now make that distinction (or at least I think I can).

One thing that I have questioned over the years while participating in numerous service activities is how effective those service organizations are. Although their services were beneficial to those they were helping, it never seemed like lasting change in people’s lives was being made. I’m not trying to say that these organizations are unnecessary or obsolete; it just seemed to me that their work was “patchwork,” only temporarily relieving the unfortunate of their suffering.

That’s partly why I have continually been impressed by the work that Rubicon National is doing. Their approach to battling the cyclical poverty phenomenon is deeply rooted in creating sustainable, long-lasting employment opportunities powerful enough to lift people out of poverty. The social enterprise models that they develop are truly innovative, creating social enterprises relying on market forces for financial stability and operating on a national scale to maximize social impact. They clearly break away from the stigma of traditional philanthropy being patchwork and make a lasting social impact in the communities that need the most help.

Another reason that I am proud to say that I worked for Rubicon National is their dedication to generating triple bottom line business opportunities, recognizing the fact that social change and environmental awareness do not have to be mutually exclusive. During my time here at Rubicon National, we have been diligently developing an energy efficiency retrofit service as a social enterprise that would create green collar jobs and pathways out of poverty in cities around the United States. Because of the federal mandate for economic recovery and climate change mitigation, Rubicon National realizes that retrofitting homes with energy efficiency measures creates excellent opportunities for the hardest to employ, offering training services and career advancement possibilities in a growing industry.

Additionally, the tremendous volunteer support that Rubicon National has had from professionals in all sorts of career fields has been awe-inspiring and truly invaluable. With over 20 volunteers from Bain and Company consulting, Net Impact, and others offering their pro bono support, Rubicon National has made significant progress on the enterprise that would not have been achieved without them. It is incredible how much buy-in to the project Rubicon National has received, speeding up the process exponentially. Not only have the volunteers shown their interest in energy efficiency retrofits, but also that they genuinely believe in the potential it has for making a lasting social impact.

I must say, though, that all of the success that we’ve had did not come without difficulty or anxiety. Because of its nascent qualities, it has been laborious finding relevant information on the retrofit industry. Other troubles have included navigating the complex matrix of government incentives for energy efficiency outlined in the Recovery Act and collaborating with others in the industry that may actually turn out to be competitors. Through all of these challenges, Rubicon National and its volunteers has impressively and continually managed to push forward.

As my internship comes to a close, I am proud to say that I contributed meaningfully to Rubicon National’s energy efficiency retrofit enterprise. As biased as this may seem, I believe that Rubicon National Social Innovations is one-of-a-kind, having unmatchable experience in the field of social enterprise and a proven track record of success. They may just be getting their footing as social enterprise modelers, but they truly are the “laboratory for scaling social enterprise” and deserve much recognition for their work.

~Michael Paci

Fog City Updates!

Bay Area Brief:

Since my last update, there has been a lot of talk on Capitol Hill and around the world with implications not only for the energy efficiency retrofit social enterprise we’re developing here at RNSI, but also for the world. On June 26, the U.S. House of Representatives passed a historic piece of legislation intended to curb greenhouse gas emissions and spur economic growth in the renewable energy and energy efficiency industries. The American Clean Energy and Security Act (ACES) puts a price on emissions that would affect the way electricity is generated, how homes and offices are designed, how foreign trade is conducted and how Americans pay to drive cars or to heat their homes.

Although the discussion on the bill is starting to heat up in the Senate, there is at least one glimmer of hope that gives reason for the passage of the bill. ACES includes around $1 billion in funding for job training programs that ensures local access to quality jobs in the green collar economy. Also, there are provisions in the bill that ensure that the principles of equity and opportunity, career pathways out of poverty for low-income and disadvantaged communities. All of this debate is so exciting for RNSI and for me personally. There has already been a lot of funding allocation for green job creation and for residential energy efficiency project, of which we are applying for, but this piece of legislation is of special importance. If passed, it is a statement that no longer will the United States turn away from the threat of climate change, while providing an economic boost to the communities that need quality jobs the most. In my personal opinion, creating social change and saving the planet are not mutually exclusive.

With our feasibility study coming to a close, RNSI is gearing up to write a business plan for our energy efficiency retrofit social enterprise and apply for federal funding. Under the Green Jobs Act, the Department of Labor is soliciting $150 million in competitive grants for national and local nonprofit entities to provide “pathways out of poverty” and into the green collar workforce. Because of the tremendous increase in capacity to do residential energy audits, retrofits, and other green labor, the grant solicitation requires that applicants have strategic partnerships to ensure that training leads to employment. RNSI is currently trying to identify strong partnerships for the enterprise in the select cities that have shown the most potential for business (Philly is one of them!). Because the industry is nascent and fragmented, RNSI and other potential partners have been finding this task to be difficult. It also doesn’t help when nonprofit are competing over the same resources.

I may not have made it clear to everyone how important it is to make our homes more energy efficient, so here are just a few figures:

• Over 40% of total U.S. energy consumption is in our buildings
• Residential and Commercial building are highly inefficient, and you can potentially save up to 40% in energy costs by retrofitting your building
• 80% of the U.S. housing stock will still be standing and in use over the next 15 years
• Energy prices are highly unpredictable, and the costs can be extremely taxing on low-income households, some of whom spend 14% or more of their income to heat and cool their homes

You see, it’s not just the question of climate change that is driving the clean energy revolution. As fuel resources continue to diminish, prices will rise and the burden on low-income households will increase. Although it is such a difficult time to invest in switching to more sustainable living, it is also the best time.

-Michael

Greetings from San Francisco

Greetings from dear Michael in San Francisco!

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Greetings from Fog City! That is, of course, the nickname given to San Francisco, CA for the blankets of fog that roll into the city through the golden gate. Unbeknownst to me, San Francisco has very mild summers, and I made the mistake of packing mostly t-shirts and shorts. Oh well.

These past three weeks have gone by in a flash… that can probably be attributed to the amount of work we have been doing lately. I am interning at Rubicon National Social Innovations (RNSI), which was being incubated by Rubicon Programs, Inc. and is now spinning off to be it’s own non-profit. RNSI’s mission is to create social enterprises that have the primary purpose of improving the economic well being of low-income people and communities. To achieve this, RNSI works with businesses, philanthropy and non-profit organizational partners throughout the country to develop nationally scaled social purpose businesses which rely on market forces to achieve financial sustainability while maximizing social returns for working poor and disenfranchised communities.

The project that I have been assigned to is the development of a national-scale energy efficiency retrofitting business. RNSI is currently running a feasibility study on the market opportunity and viability for the retrofit business with a focus on a “triple bottom line,” an expanded criterion for measuring economic, social, and ecological success. There has been a lot of talk about an opportunity to create a “green collar” economy, one that is inclusive and provide pathways out of poverty for disenfranchised communities.

I truly believe that the goals of mitigating global warming and creating well-paying jobs here in the United States for those who need them the most can be accomplished at the same time. That is RNSI’s vision for this enterprise, and we see it as the perfect triple bottom line opportunity.

So why is RNSI focusing on building energy efficiency retrofitting as a social enterprise? For one, building energy use accounts for about 40% of U.S. energy consumption. Secondly, buildings are highly inefficient and waste energy through leaky ducts and inefficient appliances and light bulbs. By improving the efficiency of energy use in homes and commercial buildings, less energy would be needed to heat and cool buildings resulting in lower energy bills and green house gas emissions. It isn’t uncommon for low-income households to spend 16% or more of their income for their energy use. Not only will this business provide entry-level job opportunities to the target population, but it will also be serving the target population by reducing their energy bills and granting them more financial stability.

Since the enterprise is still in development, I have been very fortunate to experience all of the difficulties of coming up with a business plan. I’ve been exposed to how business models are crafted, how businesses seek out public and private capital, how they pursue potential partnerships, how they research high potential markets, and how they see the market through competitor analyses. It is a very exciting process but also very crucial to the success of the enterprise. RNSI has been working at a rapid pace to construct a business model and form partnerships due to the limited amount of time to secure federal stimulus money that was allocated for green job training and energy efficiency retrofitting. Our biggest challenge is that the space is extremely new and underdeveloped, and because of this we are taking a great risk. But because of the increase in funding from the Recovery Act, we also have an amazing opportunity to use our non-profit status to capitalize on the stimulus package and the lack of capacity to spend it wisely.

So far, I have been having an amazing time here in San Francisco. I love the work I’m doing with RNSI, the city is very progressive in terms of sustainability and civil rights, and it has so much amazing history. My place here is not too far from the “painted ladies” shown in the photo below. I am also very close to the Haight-Ashbury district, home to many free-loving hippies and artists. I hope that everyone else is enjoying their internships as much as I am, and I can’t wait to read all of your entries! J

Take Care,

Michael Paci