Washtenaw County's social entrepreneurs are saving babies, fighting hunger – and making money

Right after he graduated from the University of Michigan in 2003, Phil Brabbs scored a plum gig working for the global firm Accenture as a consultant to Fortune 500 companies. But he quickly became dismayed as he noted that many of the people he worked with daily "seemed like their souls were dying."

 

In 2010 Brabbs cemented a desire to alter his career path after he was diagnosed with multiple myeloma, a cancer of the plasma cells.

 

"I just kept saying, 'I'm not going to die in corporate America,'" Brabbs says. "Why would I spend my waking hours building something I don't believe in?"

 

So in 2012 Brabbs and partner Daniel McCollum launched Torrent Consulting, a consulting firm for the customer relationship management product Salesforce that also plows 10 percent of all its profits back into supporting businesses with a positive social impact. With flagship offices in Ann Arbor and Charlotte, N.C., Torrent is just one of several Washtenaw County businesses that are pursuing a path of social entrepreneurship. Brabbs describes his approach as a blend between a traditional for-profit mentality and a nonprofit's sense of philanthropic mission.

 

"We want to show the world there's a different way to do business," he says. "You don't have to go chase the dollar. You don't have to go chase the impact. You can do both."

 

Cultivate: Galvanizing the Facebook generation

 

That mentality has caught on strongly at a national level in recent years, as major for-profit companies like Warby Parker and TOMS have built their brands around charitable missions. Ypsilanti resident Ryan Wallace says millennials have a strong generational interest in creating a positive social impact through entrepreneurship, but many lack the tools or follow-through to make it happen.

 

"It's one thing to desire it and post on Facebook or social media and say, 'Things should be this way,'" Wallace says. "It's another thing to say, 'Things should be this way and I can do something about it.'"

 

Wallace, 34, and his wife Bekah, 33, have tried to set a strong example for their peers with Cultivate Coffee and Tap House, which they opened in Ypsi's Depot Town in 2015. The business is composed of both a for-profit entity, which sells coffee and beer in a cozy renovated auto garage, and a nonprofit entity that puts 100 percent of those profits towards a variety of community-minded efforts aimed primarily at fighting hunger.

 

Cultivate grows produce for Food Gatherers at an onsite community garden and hosts regular fundraisers for organizations like Ypsilanti Meals on Wheels. With support from the Ann Arbor Area Community Foundation, Cultivate's director of cause, Billy Kangas, is also spearheading the creation of a county "hunger map" identifying areas of need community-wide.

 

Beyond these individual initiatives, Ryan Wallace says his overarching goal is to use Cultivate as a "platform" to demonstrate a workable model of social entrepreneurship and to teach others how to do the same. He says the business already regularly receives phone calls from people asking how Cultivate works and how its model could be replicated. Wallace wants to take that to the next level through more formal mentoring relationships.

 

But first, the Wallaces are working on improving their business' messaging. Bekah Wallace says many Cultivate staffers aren't fully aware of the extent and impact of Cultivate's charity work, let alone the general public. The Wallaces say communication strategy is one thing that's fallen by the wayside in the busy 18 months since Cultivate opened, but Ryan Wallace is dedicated to resolving that.

 

"I'm very clear that I've got six to eight months to set what our culture is going to be going forward," he says. "We're very proud of it, but it also matters how you communicate it."

 

Warmilu: Thinking social, staying sustainable

 

Ann Arbor social entrepreneur Grace Hsia experienced similar difficulties with establishing and communicating her mission in her business' formative years. Hsia is the CEO of Warmilu, which produces a low-cost, reusable, non-electric heating pack. Hsia conceived the product as an infant warming blanket while completing her materials science engineering capstone class at the University of Michigan.

 

Partly inspired by the incubator that saved her own life as a preterm baby, Hsia wanted to market the blanket to under-resourced hospitals in the developing world.

 

"I was really stubborn," she laughs. "I was like, 'We're going to save babies and that's it.'"

 

The Warmilu team has certainly had success on that front since the company launched in 2011. Most recently Hsia and other Warmilu team members traveled to Kenya with their Ann Arbor-based nonprofit distribution partner Relief for Africa, introducing the blanket to doctors and hospitals there.

 

But introducing a product into the developing world is no easy proposition. Hsia discovered that it was essential to find nonprofit partners who had preexisting relationships in the countries Warmilu is trying to reach, and even then orders were rather small. Meanwhile, Hsia says Warmilu began to attract attention from "a hundred different directions" – ranging from American medical suppliers to IMG College Seating, which wanted to repurpose Warmilu's technology for rentable heated stadium seat cushions.

 

Although Hsia was initially resistant, over the past two years she says she's allowed herself to broaden Warmilu's focus to be "a warming technology company that is driven by the mission of saving lives in resource-scarce settings."

 

"A social mission becomes like a guiding star," she says. "If you have a social mission that really speaks to your whole team, it can shape your culture. It can shape your strategic decision-making. And it becomes a tool that you can use to start dialogue with potential partners."

 

Hsia says if she could change one thing about how she went about establishing Warmilu, she would choose to be less "blind" to alternative revenue streams. While developing-world partners may purchase 500 to 2,000 Warmilu blankets in one order, the company is currently hammering out a deal with IMG that could result in an order of 22,000 units.

 

"As we continue to grow, one thing we have to work on in the future is maintaining that happy balance between the social mission and whatever we're doing in the developed market," says Warmilu VP Larrea Young. "It's so important to make sure those two balance out and not forget the social mission and not forget how to keep it sustainable."

 

Torrent Consulting: "We don't desire to have a ton of money"

 

At Torrent, Brabbs is also figuring out the balance between his profit-minded business and the social endeavors it funds. Torrent has experienced major success in its short lifespan so far, having been named the 164th fastest-growing company in America on last year's Inc. 5000 list. Torrent10, the nonprofit to which Torrent filters 10 percent of its profits, has funded two social-impact endeavors so far: a Charlotte coffee company that donates a portion of its profits to the low-income neighborhood it's based in, as well as a fledgling business that aims to support Guatemalan orphans.

 

In both cases, Torrent hired employees – one in Charlotte, one in Ann Arbor – who had a passion-project idea for a social business. Then Torrent allotted those employees both company time and a financial investment to pursue their entrepreneurial endeavors with the goal of turning them into full-time jobs. Torrent10 made a royalty payment to both businesses that will be paid back over time and then reinvested into those or other new businesses.

 

"What I don't want to do is take an equity stake and then influence something in a direction it's not meant to go," Brabbs says. "We want to protect the integrity of their business, their heart, their vision."

 

Brabbs envisions Torrent eventually emulating Zingerman's model of a community of businesses that's "great, not big." He seems to embrace flying by the seat of his pants in this process, admitting that he's just taking a chance with some of his profits and seeing how things pan out.

 

"We don't desire to have a ton of money," he says. "When you have incurable cancer, it's like, you give me a gazillion dollars – what am I going to do with it? I've got to go to work tomorrow and I love working. I love working and I want to create value."

 

Want to learn more about social entrepreneurship in Washtenaw County? Grace Hsia will speak about her experience during our upcoming High Growth Happy Hour event at Conor O'Neill's on Tuesday, April 18, from 6 p.m.-8 p.m. Find more information and RSVP here for this free event. We hope to see you there!

 

Patrick Dunn is the managing editor of Concentrate and an Ann Arbor-based freelance writer for numerous publications. Follow him on Twitter @patrickdunnhere.


All photos by Doug Coombe.
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