IT consulting company maximizes its impact
A Richmond-based IT consulting company has given away its ownership to two charities.
If that goes against what you learned in Business 101, don’t be alarmed. Impact Makers is one of 33 benefit corporations in Virginia, a growing number of companies that strive to have a social and environmental mission in addition to making a profit. That social-enterprise goal must be certified by a third party, like the nonprofit B Lab. It ensures that companies meet rigorous standards performance, accountability and transparency through its B Corps Certification process.
The Virginia law creating benefit corporations is not new. The General Assembly passed legislation in 2011, thanks, in part, to efforts by Michael Pirron, Impact Makers’ CEO and founder. Giving away a company’s full ownership to public charities, however, appears to break new ground in the social-enterprise movement. “I believe we’re the first ever,” Pirron says.
The Community Foundation Serving Richmond and Central Virginia (TCF) received 70 percent of the ownership, and the remaining 30 percent now is owned by Virginia Community Capital (VCC). TCF is the largest of Virginia’s 27 community foundations. The nonprofit VCC owns Community Capital Bank of Virginia, which is a certified B Corp.
Impact Makers’ ownership currently is valued at $11.5 million, but the new owners won’t realize any of that until the company is sold. That event probably is 10 years away, Pirron says.
VCC and TCF plan to use the money to invest in social enterprises (either directly as investors or, for example, by issuing grants or loans). Meanwhile, Impact Makers plans to continue giving 30 percent of its annual operating margin to its charitable partners. They currently include the Rx Partnership, Family Lifeline, Peter Paul Development Center and Future Leaders in Project Management.
Overall, Impact Makers, which has grown to roughly 76 employees since its start in 2006, hopes to encourage other companies to follow its business model. The company says it has had a $1 million impact on the Richmond community through financial contributions and pro-bono work since its start. It hopes to increase that impact to $100 million by 2024.
“We are a group of middle-class professionals doing the same work we’ve always done but structuring it differently and collectively making the same impact in the community as foundations in town … as we grow, we are hoping to be as big as some of the large foundations in town,” Pirron says. “That’s a disruptive, game-changing model. I think, out of anything else, that is the biggest value to what we’re doing.”