Episode 026 - Adam Long - Ethical Business & Global Change | Limeworks

Episode 026 - Adam Long

Ethical Business & Global Change

Adam Long, also known as The Ethical CEO, specialises in growing businesses that matter. 

We talk about Ethical Businesses and Social Enterprise, what it takes to put a cause at the centre of your business, how to get Matt Damon to wear your socks, even business failure.

We also talk about an insightful trip to the World Economic Forum, and how even Billionairs can suffer from imposter syndrome.

Connect with Adam: 

Website: https://www.theethicalceo.com/

LinkedIn: https://www.linkedin.com/in/adamlongentrepreneur/

Conscious Step: https://consciousstep.com.au/

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Transcription

Please note, while an effort is made to provide an accurate transcription, errors and omissions may be present. No part of this transcription can be referenced or reproduced without permission.

Rob: So Adam Long, the ethical CEO, thanks so much for joining us on the podcast today.

Adam: So glad to be here Rob.

Rob: It's amazing to have you here. And so I really want to talk about quite a few topics with you today. But for those who haven't heard of Adam long before, can you give us a little bit of a rundown of your professional history and how you came to be here today?

Adam: Sure, well, where I specialise is working with ethical businesses so really keen on working with businesses that are doing good things for the world. After all, we only get about eighty thousand hours in our life to spend on a career so we can make choices about where they are. My choice is particular types of businesses that are shaping the world that I want to live in and I want the people around me to live in. So I work as a consultant for ethical businesses. I've started a few of my own. That includes a sock company, which is why I'm not wearing any shoes.

Rob: Very good.

Adam: Never hide the merchandise. A software company in the legal tech sector, that software used by a few hundred law firms around Australia. I work with organisations like Humanitix, the not for profit ticketing platform that uses ticket booking fees to aid, help the 400 million kids around the world who aren't getting an education to get an education, and really cool things like that.

Rob: Interesting.

Adam: Yeah.

Rob: Interesting.

Adam: I have fun. It's good.

Rob: And so, I mean, straight out of uni, you actually became an industrial designer and I mean probably retrospectively, it really serves you here. But I understand you sort of went through a bit of a marketing route. Can you give us a bit of an insight into how that came about?

Adam: Yeah, sure, look, I started as an industrial designer with that romanticized view of what it was to be an inventor in the 1960s, remember when someone would just go into the garage and create a world changing idea? That's what I want to do. And when I got to uni, I'd often end up in arguments with my lecturers because they'd give us tasks like design something, design some furniture for kids. Great. Got that easy project. But then they get to design something that will encourage sustainable behaviors or design something that will help with access to clean water in sub-Saharan Africa. And we hit this point where designing an object was no longer the answer it was very clearly a policy, an organization, a different way of doing things. It wasn't about a product to solve the world's problems. So we were using this design thinking principles before design thinking was a was a trendy term, but the focus of it on products just wasn't working for me. So after starting a business which didn't work out, trying the government for a little while, which also wasn't right for me as well, I found that the decisions that go into marketing, behavior change, communication, the strategy that sits behind businesses was what really got me excited and where huge amounts of change could actually happen.

Rob: Interesting. I just want to pause on that, because you touched on it briefly, that there was a business that you started which didn't quite make it out the other side. Can you give us a bit of an understanding of what that was and what happened?

Adam: Yeah, so that's that's an alternative MBAs to just start a business, spend as much as you would on an MBA, money disappears. You still come out with nothing on the other side, but hopefully some learning experiences. So as a as a twenty four old I was so excited about 3d printing, I could see this is going to be the future. People can create anything they want if they have an idea that can become tangible reality and a device that would sit next to your fridge in the kitchen. And so I wanted to build the first sustainable manufacturing system based off this these digital systems where anything you make could be made with renewable energy and also be recaptured and reused to make new things in the future. Now, the advice I got from all the startup advisors, business advisors out there was you have to be more passionate about what you do than anybody else. You have to hear a lot of people say no and just push on anyway. So I did I was more passionate about 3D printing than anyone else. That was a problem. No one else actually needed what I was working on at the time. It was Christmas Eve of 2011 that I had to sit down with these two staff members that I had been to uni with them, look them in the eye and say, I'm really sorry, guys, there's no business to come back to next year we're we're out of business. And that's not about that big. That day, it was forced a lot of introspection in the aftermath of that at lost investors money in the process and all the things that I thought would set me up to succeed no matter what hadn't got me there. And so in the aftermath of that, it was really reflecting on why, why, why did this not work out? And part from having quite a few a one on one business lessons that I hadn't learned at the time. I realized what was really lacking in my life was an understanding of how to change people's minds about things, how to get them excited about things that they they weren't, how to connect with the right people, which took me down the path of marketing. I realized if I could just understand marketing and sales, then these world changing ideas that are out there could actually change the world instead of being something that everybody ignores.

Rob: Interesting, and so that kind of carried you through into an agency life for a little while in in your professional career, which is, quite away, from a 3D printing startup. How did you find that transition from startup founder to agency love?

Adam: Well, I'd taken a big slice of humble pie after the first business and went from a I'm a CEO, here's my business card, I'll give my mom one of my friends through to oh no I don't know what I'm talking about, need to build some skills from scratch. So recognizing that I need to get into marketing side of things and sent out my resume to ended up being fifty two companies I remember and didn't get an interview from a single one, not surprisingly looking industrial designer, 3D printing government. The hell are they doing applying for marketing at Vodafone for example. And it got to a point where I was so desperate for a job that I was at an event where these marketing strategists were getting up on stage and they were giving themselves nine minutes to build a strategy for members of the audience live against the clock. The audience would vote whether they were stumped or passed and I was hearing these these models coming out. It was a real structured way of thinking and solving problems that I could see. And I was like, this is what I need to learn, this is what I'm missing. So I did what anyone else would do. And when they said, all right, who's got a marketing challenge for me to solve? I put up my hand, went out the front, got down on one knee like I was proposing to them and said, You don't know me, but I know you and we should be together. Can I please have a job? Now they had maybe one hundred potential clients in the audience. They'd all had a few beers and they go, Oh yeah, give him a job give him a job, this guy. But you can start Monday. Just get off the stage. Turned up Monday. And yes, six years later is one of the owners of the business and step change had 40 staff worked with companies all around the world, more than 100 clients a year, just solving problems for the business owners with that marketing, customer design thinking. And and that's one of the gaps, I think, in most people's understanding of marketing and the connection to strategy. So often the marketer is someone you you hand something to at the end of the process, hey, we've done all this great thinking, go and make some nice pictures and Instagram posts to tell the world about. But so often when I'd be sitting down with business owners and asking them the fundamentals of what's driving their business, what's actually making the difference between profit margin, mapping out the algorithm that underpins a business. And not too many marketers ask these questions about the dynamics underneath that. And so getting to a point where you can get a sale and get marketing means understanding, product, understanding, customer making huge choices throughout the business, which is that that connection between marketing and strategy.

Rob: Yeah, I certainly think there's a disconnect between, you know, the creative and the motives behind it sometimes. And where does the line are? Not where I thought we'd get to just yet. But where does the line between sort of gut instinct on, you know, what will work and where does that blur with strategy, where it is a very methodical, you know, fine tuned process to get there.

Adam: I have a gut instinct if you've ever looked inside your guts, it's not pretty in there, I don't think I don't hold much value on on gut instinct. And I think it was Andy Grove at Intel used to say, look, if all we've got with opinions, we're going with mine. If we can get data, let's decide with with the data and with digital tools that we've got the ability to to test ideas really rapidly and get from idea that opinion and get actual tangible data to work with. We're actually living in a really incredible time for that. Yeah, instinct tends to get in the way. We're all we're all, fallible, and the fact that marketing exists as an industry with a huge number of human biases, heuristics, we can play off. There's so much that there can be done. Gut instinct is a very dangerous thing.

Rob: Is there a bit of a I don't know, a method to cracking someone? We've all come against or met people who are dogmatically driven and you could show them all the data in the world to prove otherwise. And, you know, you could you can say that the earth is flat. You can say that the earth is round and I don't want to go there. But, you know, how can you sort of how much data does it take to really convince someone that maybe their gut instinct or their perception is incorrect?

Adam: So when it comes to working with privately owned businesses, it's always worth remembering that business owner owns the business. At the end of the day, they can kind of do what they want, and that's OK, as long as we recognise that that's the choice being made and often have that conversation with the with the businesses that I work with is, here is the optimal business outcome. But, hey, this is what might actually be optimal for the type of life you want to live for, the passions you want to indulge. And that stuff is OK as long as we recognise that that's a choice, rather than wrapping it up in a narrative of why this might be the best business decision when it when it clearly isn't. So, yeah. So it's OK to have gut feelings about what you want to do as long as you recognise that it is a personal choice rather than a rational business decision.

Rob: Yeah, I mean, it's an interesting aspect of human psychology where, you know, just in the face of insurmountable data, you can still think a particular way because of whatever reason. But I mean, I've I have a little bit of experience with, you know, you got you working in a strategic context and, you know, you invest or get the buy in from the clients. So much in the process. Does that help reshape things? And I get to the end of the process and maybe they're a little bit more pliable than what they were at the start.

Adam: Yeah, there's something called the affect heuristic, which is we place more value on the things we've had a hand in creating. It's why people love assembling their IKEA furniture. They've had a hand in it.

Rob: Sort of.

Adam: We love to complain about it afterwards, but that just makes the challenge more powerful,

Rob: It does.

Adam: Like, It brings story and meaning to it. And it's true with with strategy as well when working with businesses, with large teams, taking the team on that journey so they can understand the building blocks that arrive there is so important. Without that buy in, you can end up with with a lot of white anting where people agree to something, but really they're just kind of go back to what they were doing before. And getting to that point where strategy is actually executed massively requires that buy in up front. So working with clients typically goes over over weeks and a lot of empathy required to to get to a point of strategic clarity.

Rob: Interesting and sort of looking, I don't want this to be a to too much of a pointed question, but looking introspectively to, you know, nine years ago when you did wind down your start up, do you think with the right strategy now and the tools that you have now as a strategist, would the outcome potentially have been different back then?

Adam: Absolutely, if I knew what I knew now going into that 3D printing business in 2011, I would have run a couple of experiments over a couple of days that would have told me this is not a good idea and I would have moved on to the socks or something else much sooner,

Rob: Yeah, interesting.

Adam: And I'd be much happier as a result.

Rob: But we learn valuable lessons along the way, no doubt.

Adam: Absolutely.

Rob: And so you just talked about socks, which is your company, Conscious Step. And it sort of brings us to one of the topics I did want to discuss today around ethical companies and mainly around how different an ethical company is, where a cause is at its core and at its root, as opposed to something that sort of bolted on for marketing effect. Can you give us a bit of like your perspective on those two things contrasted?

Adam: Yeah, sure. So somewhere in the 1980s, the phrase greed is good, really taken to heart by a lot of the business schools around the world. And there are many business owners that I spoke to even today, who say the core reason for business to exist is to create profit. But when we talk about what that actually means, the word shareholder value often and the word value doesn't implicitly mean dollar value. When we look at what's possible with the business, the outcomes that you get don't necessarily have to be pure profit. And the reason that's important is because the type of world that most of us want to live in can't be created by any one business, one individual. Take air quality in New York, right. Can be a pretty horrible place.

Rob: Yeah,

Adam: You can be literally the president. You can be the richest person in New York. But as an individual, you can't make changes to create an environment in New York with beautiful air quality for everyone to experience. So the idea that shareholder value extends beyond just pure profit gives a lot of scope for businesses to be able to shift and change the world. That creates the environment, the world, the society that we want to live in, not just generate more dollars, which, when you get down to it, is just an arbitrary bit of data that we all agree has value. So tangible value change. So it's about that shift from shareholder value to shareholder values. And if you've got a broader idea about what's valuable in the world, you can use that. You can use business as the tool to make that happen.

Rob: Can you give us a bit of an understanding of how Conscious Step manifest that?

Adam: Yeah, sure. So Conscious Step is a company makes very fashionable socks, you'll find them in a few thousand stores around the world or on the feet of people like Matt Damon, Jane Goodall and the socks each make a tangible difference to the world. So through partnerships, for example, with trees for the future, one pair of socks will plant 10 trees for every pair that we sell at the one of my right foot here. This one provides three meals to kids in refugee camps. Every pair we sell, the one on the left. Yes, I'm not wearing matching socks that supports 18 months of clean water through Water.org, which is founded by Matt Damon and hence Matt Damon wearing the socks as well.

Rob: Amazing.

Adam: So essentially, when you go into somewhere like David Jones and you've got multiple very fashionable looking socks on the shelf and at the same price, pretty good quality, largely they come from the same factories. Anyone working in product manufacturing wouldn't be surprised to hear that. But you can see that one. Can make a really tangible difference to the world. That's the one that ends up getting picked up off the shelf. That's the one that ends up being given as a gift because it's got something beyond just the functional utility of a sock.

Rob: And so, like, I've got a few statistics which may be out in terms of the impact that Conscious Step has made and the numbers that I saw were over 400000 trees planted, 50000 books donated, almost half a million rainforest trees protected. And so, like, obviously, that's pretty substantial impact when people would have put socks on their feet, regardless of where they came from, from a business perspective. How do you factor that in or what considerations need know? Because obviously all those things cost money, even if it's a small amount of of the overall sale. How do you factor that in to a business model when, you know, business can already be tough?

Adam: Yeah, so the structure of social enterprises is something I can I can geek out about all day. But in a nutshell, one of the choices we made with with Conscious Step was to design the business model so that there were never any adversarial incentives. And what I mean by that is when a company set themselves up, so we will give X percent of profit to a charity at the end of the day. Now, any business owner knows that at tax time the job is to minimize profit, maybe pay the staff a bit more, maybe bring purchasable profit is a very arbitrary number. They can be moved around. So we set up the business so that when a sock gets manufactured, there is an amount earmarked that then goes to the charity that will make that impact regardless of what happens with the business down the track. So when we manufacture a sock and we put on the packaging, this will give three kids three meals to kids in refugee camps. It will do that because the money's earmarked. Whether we give the pair away, sell it at full price discount. Whatever happens, there's no conflict there between the operations of the business and making that impact. Something I'm really passionate about for social enterprises, making sure that adversarial incentive is never set up. So you're making choices between myself, make a change in the world, just separate the two. It's very possible to do that.

Rob: Interesting, and is that really where the differentiator between something that's at its core and, you know, something where it is almost a bolted up, bolted on, you know, social impact, is that where it differentiates? But should we also not discount the impact that are bolted on, you know, bolted on impact or cause can still enact some good and some change.

Adam: So I would never object to any company that bolts on a positive impact on the world, if that's what they need to do to make it happen in the context they're working in, then then fantastic and more power to them. The companies that put it right through to the core, the ones that end up building a better connection with their customers and get close to what they're trying to achieve and then adding it on. So I would never criticise it, but very rarely recommend it as a as a it's an add on. And it's also worth recognising that. For a lot of good causes out there, people don't care, and it's not because people are bad or ignorant, it's just there's so much demand for our attention in so many different ways that to get people to care about the particular cause that you're passionate about in any given moment is actually really hard. So embedding the change that you want to make into the businesses is really important. But it's also worth recognising that just having that doesn't mean that customers will buy what you do and having an ethical side, having a social impact is actually not that effective as a as a sales message. Now, if you ask customers, would they buy an ethical product over over a neutral product, customers, of course, say yes, absolutely. 90 percent of the sale will always pick it. Always. But then when you ask those same customers after they've left the supermarket and look at what's in that basket, say, well, why'd you pick that? Why did you pick that? Why'd you pick that? Turns out that habit price quality, all these factors matter as much. So the message there for social enterprises ultimately is that being an ethical business is not necessarily going to get great. You have to compete just as hard as every other business and have as good or better a product as good or better price. And I think humanitix is a really good example of where that's come out, said the two founders of that. Joshua Ross and Adam McCurdy had that as a philosophy right from the start that to compete in ticketing software against the likes of Eventbrite and hundreds of other companies out there, it's not enough to say, hey, look, we don't have all the features and we're a little bit crappier in the load. Time takes forever. But hey, you get to educate kids like not. There's features that you won't find on any other platform. The system is better than what you find elsewhere. To experience both for the customer and the event organizer is better. And the fact that a booking fee on a ticket goes on to make a tangible impact actually has a lot of benefit for the event organizer as well. It's a reason to connect with the customers. It's a reason people come back and buy more tickets for them in the future. So that's a really good example of where the impact made on the world. Well, at top level, looks like a bolt on actually has really deep value for the event organizers themselves. Event organizers get something else they can talk about at the event. The ticket buyer A gets the added benefit of the treating themselves, and they're treating someone else at the same time. And there's kids who are getting an education as a result. That's the kind of set up and structure that can be really, really powerful with the business.

Rob: So really, the product and the offering needs to be, you know, needs to hold its own without that social enterprise element, because, as you say, the social enterprise isn't enough to get it. To make up a deficiency. Is it then also important to not only market that social enterprise and, you know, beneficial aspect of things, but also make that process very frictionless so that customers don't have to do any added work to gain from that benefit and get that feel good? That comes from it as well.

Adam: Yeah, absolutely, and it's the same principles that apply to all businesses, take things out of the way of getting a sale and you get closer to it.

Rob: Is it do you think there's ever a time when social enterprise wouldn't be an appropriate sort of response or incorporation for a particular venture, or is it something that could be added even if you are in a think arbitrarily, say, mining or, you know, something that is universally thought of as having an impact? You know, maybe they introduce carbon offsets or something like that, is is there a line where that becomes something they should do anyway but, you know, maybe wouldn't resonate at a at a consumer level?

Adam: So there are businesses out there, which are long established, working for for decades, some of them centuries, multiple billion dollar businesses that are filled with people that want to make real social, ethical environmental change within them. And a lot of them struggle to actually make those changes because of the way their business is set up. And that's actually where regulation is very powerful. Companies of a certain size find it very difficult to make the changes internally, bring in a government mandate. You can make those changes. So there's there's no one solution where a massive change can happen without involving other people. I think that's a that's a really cool message. So the businesses that have been running with more, I guess, a traditional, hey, we're doing business for the sake of doing business, the avenues to make an impact. So one very good approach is to become a big corporation. So the big corporation, which is often called called B Corp Australia, started with the recognition in the US that the owners of a company sorry, the management of a company could get sued by the shareholders for, say, giving ten thousand dollars to charity because that is reducing shareholder shareholder value.

Adam: So in the US, they required a legal structure to recognise that a business could have goals beyond just a profit motive. Now, around the world and in Australia, the big corporation certification means that looking across more than two hundred different areas of the business, that the business is doing pretty good things in a whole bunch of areas. Now that can range from inclusion and diversity in the staff through to the ongoing environmental impact of what that does and says. OK, well, across these two hundred areas, if you've got 80 of them working pretty well, then great, you get the B Corp certification. It's just like a fair trade certification for for business. It shows across all the things that they're doing. This is good. And that ranges from product manufacturing companies through to resources companies, through to law firms. It's really diverse. The companies that can get there and a really good indicator that the management and owners in that company are taking very seriously the impact that they have on the world.

Rob: Interesting one aspect that really is a curiosity of mine, I suppose, is how important if you are trying to select like a cause to make part of your company, and that is a foundational aspect of your company. How important is it to select the right things to stand for? And is there a well sort of versed process to do that?

Adam: So there are a mix of things that that come into play the best causes match to a business, the ones where the core business and the cause build off each other and really contribute to each other. So in the example of Socks, I mean, most of the sock purchases are purchases, gifts. And the story of of the impact that it makes makes the gift more valuable because what do you get at Father's Day of Christmas? Yeah, a whole bunch of people are going to get socks. Year after year. But if it's socks and trees, socks and you've protected an elephant, then that story is really valuable. And so an example which you'll be familiar with, Rob, of making those choices is that is the start up on the central coast. Thank Fork working with with plant based foods. Now, in talking strategy with them at the early stage of their business. One of the questions they had was, should we start a tree planting program where for every meal package that we sell, we're planting trees as well. And for them, what they needed to recognise in that conversation was the fact that they were doing plant based foods and diverting so many meat eaters around the world. It maybe one or two meals a week from a meat product to a plant based product. The impact on climate change, on on animal rights is huge just in that alone. So for them, they didn't need to look at planting trees as well. As beautiful as that would have been as an add on what they did in their core business was enough. So when we can get to a cause that really fits with the operations of the business. That's where the magic happens.

Rob: Interesting. So one thing I understand about you as a professional shifting directions just a little bit is that you're you're working with step change, working with humanitix, doing consulting and doing a few things at once. And I just wanted to kind of get your perspective on managing different things. It's it's really, really amazing sometimes to just have one thing that you can just nut through for, you know, quite some time. But how do you find that balance and demands on your time from different directions?

Adam: I love it, it's it's the simplest way to answer it, I love it. So the approach I take to my career is more of a portfolio career there. In any given week, I might have a board meeting for conscious step and spend a couple of days in the office with humanitix and then go and work with a company that makes laser sensors for self-driving cars for a couple of days. And while that seems to be bouncing around a lot, what happens in one day invariably brings up some value next day for someone else. So for business owners that are completely hyper focused on what they do. Brilliant. I love seeing that. But when they hit a challenge that they haven't sold before, often what they don't realize is that there are hundreds of businesses, often in other categories and other industries, that have solved that in creative ways. And joining those dots and making those connections makes it makes it hugely valuable. So spending a day where I'm on stage at a conference but then happening to talk about humanitix the same same time is valuable for all parties involved. And it's recognising that there's an ecosystem to a career and it doesn't necessarily have to be working with one organisation full time, five days a week, two days off break.

Rob: Interesting and is that that versatility and diversity partly what led you to the World Economic Forum and can you give me you could probably say it a lot better than I could about why you were there and and the experience that you had there.

Adam: Yeah, sure so I attended the World Economic Forum in Davos, Switzerland, last year, which is basically the United Nations for business in a sense. So it was started with a sense of the United Nations bring together world leaders because getting them all in a room together is very productive. But in the 1970s, Professor Klaus Schwab recognized that, well, there's all these huge companies around the world also making a big impact. When do they get together? So that was the establishment of the World Economic Forum. So three and a half thousand people in the town of in Davos with the most intense security I've ever seen in a given spot. And so that was an opportunity to set up the right conversations between people. And it was an incredible week as well from one moment to be having cocktails with the diacetyl of the CEO of Microsoft and then go and sit next to the CEO of Asia Pacific at a dinner that night. And the opportunity to bring all these people together to find overlaps and actually have important conversations about challenging core business models is really important, valuable.

Rob: That's amazing. So you were part of is it Global Shapers, and that was sort of an initiative of the Global Economic Forum to sort of recognise that business is changing and there are things, aspects of business that they don't understand, maybe those pesky millennials or something, which I think we both are. But like, how was did you ever sort of come up against, you know, I don't know, a hesitance to to recognise that someone who's younger than a stereotypical global business operator can have something important to say.

Adam: So the World Economic Forum recognized pretty early on that there was a diversity of views that probably weren't reflected in those who could afford a two hundred thousand dollar ticket. So they set up essentially a conference side of the forum where they bring in speakers and participants from all walks of life in the Global Shapers, which is a world economic group for the World Economic Forum Group for under 30 year olds, is one of those. And that was the group I was with at the time. So in terms of coming up against views that. Don't fit the tradition that there is a lot of open mindedness to it, and the reason I noted that was because it became very clear just how many people the World Economic Forum is suffering imposter syndrome. And that just blew me away to be sitting next to a billionaire on one side who controls the purse strings of Silicon Valley and then someone who's like a Jane Goodall, who spent a life doing incredible things with apes around the world. And each of them kind of look at each other and go, wow, that person has real influence.

Rob: Interesting.

Adam: And I heard that from so many people say you have done such great things in business and investment. But I just wish I had that same level of passion. Is the founder of TerraCycle over there whose building systems that can recapture any waste from around the world. So there there is a certain humility that comes from being surrounded by those sort of people, which actually makes people open minded to some very different ideas. Case in point, Bill Gates started the Bill Gates Foundation after hearing a talk at the World Economic Forum about the impact of malaria on people.

Rob: Interesting.

Adam: And that was a critical part of his transition from Microsoft CEO taking over the world, through business, through to oh, actually, we can make a huge amount of change here. And these are tangible problems solved.

Rob: That's interesting, and so obviously, having the unique experience and insight of rubbing shoulders with, you know, global business elite and contrasting that to, you know, every business owners back here in Australia is there are more similarities than you would have anticipated or, you know, there's still some distinct differences in thinking.

Adam: A. Having been in bathrooms with billionaires, with indigestion, it's yeah, everybody's seen and I think that's a that's an insight that's often missed with the aura of celebrity that's created around some of these people. And there's a sense of of looking at people who've been very successful and going, oh, wow, they've they've done something something different, something special that can't be me. The fact that they're sitting there with the imposter syndrome as well shows that actually we're all sitting with the same psychology. And now I'm not quite utopian enough to say great, so we can all be billionaires. Eventually, the number of the number of systems, the way society is set up definitely privileges some above others, which gives them opportunities that others don't. And that's something to be solved. But psychologically, we're all largely the same.

Rob: Yes. Whether you took the train or a private jet, maybe your mental space is the same. Interesting, very interesting.

Adam: I was on the train, by the way.

Rob: Now it's all, you know, positive carbon change, too. So an interesting thing around that I didn't quite get to before around balancing time and sort of working on different businesses at the same time and I think this is probably perhaps more with the lens of a parallel founder who has, you know, four different things to to go at once versus one. We talk about serial entrepreneurship a lot of the time. But is there a case for, say, parallel on entrepreneurship? But does that come with certain conditions? And maybe a bit of an abstract question, but it's there anyway.

Adam: Yes, so there there is a lot of value in focus, and while the portfolio that I've got set up has multiple things going, I'm certainly not trying to work on them at a single time. So the early days of setting up Conscious Step required full days. I was working on the job at the time, but that meant working for a full day's work and then doing another full day's work. Now to then throw in another startup idea that that's crazy. The amount of effort and focus required to get a business off the ground is intense. So doing one thing well, then getting it to a point where you can transition your role is, is the approach that works.

Rob: Interesting. I am not sure whether you're familiar with Ari Measle, who has a book and the replaceable founder, and and I think it takes a very similar approach to that, where it's it's, you know, launch and set it off into the so, you know, the train continues. It's got that momentum and that, you know, overcome that inertia to just sort of continue on into its own way.

Adam: It's a great perspective to take to business in setting it up as a as a young man, I remember reading Tim Ferris's the four hour workweek

Rob: Oh, yeah,

Adam: Thinking,

Rob: We've all been there.

Adam: What is this? This is absolute magic. You just you just set up a business and then you only work on it four hours a week. That's not true. You've got to work on something one hundred hours a week for a couple of years and then you can make it four hours a week to.

Rob: Yeah, I guess it's that whole, you know, getting the abs is the hard part, but maintaining them is a little bit easier maybe. I don't know. I'm not speaking from experience there so. And so your involvement with humanitix, which we've touched on a little bit already, I wanted to just get a little bit more understanding of the business model there. I think we're all familiar with, you know, Ticketek, an eventbrite, and all those sorts of platforms coming back to where you've said that businesses, even if there haven't have a strong ethical ethos, need to be, you know, market savvy and cutting edge themselves. What are some of the things that someone like humanitix is doing? Right, and also touch on the ethical side as well?

Adam: Yeah, absolutely, so the that core philosophy that I mentioned earlier, that the platform to be better than other platforms to win the ethical side was was not enough to make the difference on its own. And it brings us to the baseline of competition for software platforms. And an event organizer might choose to do a ticketing. So that's why we have a team of people that are constantly investing in new features that aren't found anywhere else. So one of the first in the world, for example, to partner with canva so you could automatically create the graphics for your platform without needing a graphic designer on hand. And those partnerships and partnerships that we've had with Microsoft and others have been really helpful in terms of how that actually works. So humanitix is a is a charity to registered charity, which means there are no shareholders. There's no there's no profit getting paid out at the end of the year. Humanitix operates the platform, takes a booking fee on on tickets as all platforms do. And the that booking fee, once we've paid our costs, then all goes towards these education programs that we're running in partnership with organizations like Room to Read, which just do incredible things around the world.

Adam: So it's no extra cost for anyone involved. It's redividing resources that would otherwise go to a shareholder's pocket and deciding that the shareholder in this case is going to be a child in Cambodia who otherwise would drop out of school 12 or a child in New Zealand. We've heard from our charity partners the stories of four kids turning up to school in different years, meeting up at lunchtime to share a single sandwich because that was all they had available to them. So putting in place programs and resources to support kids just makes a huge difference to their experience through the education system. And all of that is possible with a booking fee that people would otherwise just get annoyed about anyway, added on at the end and then it goes to some some shareholder. So we turn that into something that's actually a valuable part of the experience, the person buying the ticket in the event organizer as well. And there's nothing more exciting than standing up there and saying, hey, we've put on this conference, but also two hundred girls in Cambodia are going to go through school as a result of this. That's a it's a pretty exciting moment.

Rob: It's pretty killer, and I think it demonstrates how important getting that formula right can be in terms of, yes, it's a worthy cause, but as people, you know, we can be lazy in a lot of ways and everything needs to be frictionless. But, you know, and is that that sort of the secret sauce is make it as frictionless as possible and as good or better than the competition, but just with an added bonus of feel good at the end.

Adam: Yeah, absolutely, so people aren't bad, they're not lazy, we just all do the same thing, which is look for the easiest way to get the particular result that we're after. So, yeah, in any any social enterprise or any business looking to make positive impact, you can't make it harder for your customer to achieve achieve that. The more we can do to make things default to the right behavior, the better the world ends up.

Rob: Absolutely, 100 percent so I was touching on the other side a little bit. We are going to start to wrap up here. But on the other side, as a consumer, is there a way that we can sort of, I don't know, vet or test these ethical companies to to really make sure that we're supporting a worthy cause and that it is directed the way that it's intended and not, as you say, post profit or post, you know, feel like doing it.

Adam: Yeah, sure. So looking to organizations that have a charity structure as a basis is is one good indicator, say, humanitix being a registered charity. Thank you is another one that a registered charity where the commercial activities are all going towards the particular goal that they're working on, looking for certifiers like Fairtrade B Corporation, as well are two that are really good indicators that that something good is happening here. And just asking the question, when someone says they exist to share profit, at the end of the day, what happens between start of the financial year and the end of financial year? Really, really understanding that they're good questions to ask. But at the end of the day, the. The organisations that make a commitment to to doing good are finding ways to do good if they've got the public declaration that they usually well on their way. There's actually very few examples of things ever getting diverted to places that they shouldn't be.

Rob: Interesting, yeah, I mean, it's I think we all can can relate to, you know, looking at that shiny goodwill purpose and maybe being a little bit underwhelmed when you look a little bit deeper. Certainly things like humanitix and Conscious Step are doing it the right way.

Adam: It's also worth, I guess, benchmarking against the equivalent businesses that are not having an impact. So what comes to mind is when thank you had a rather critical article written about them, believe it was last year by The Telegraph,

Rob: Plastic water bottles.

Adam: And it wasn't about that. They were looking more at just the operations business, like, hang on, this is a charity and this is the average salary for their staff and they're spending money on advertising and how dare they when they're a charity. But if you look at the next company making making says, look at it, go and look at Leever or or Procter and Gamble and look at the systems they've got what they pay staff a lot more than what thank you is is paying staff on on an average. What they spend on advertising is a lot more. So thank you is having this incredible impact and yeah it costs money to run an operation. But they've built a machine that is reliably generating impact. Who gives a crap is another another great example,

Rob: Sure

Adam: The toilet paper brand where yeah, they they operate as a as a commercial entity. They could have gone down the path of being entirely for profit, but they've set up a system that has an impact. And if you compare that against Kleenex or another, it's incredible what that value actually is.

Rob: I have certainly read a few of those criticisms around social enterprise and thinking that they somehow magically don't have to advertise or they don't have to pay their staff or they don't have to do anything else, you know, that a regular business has to do not for profit or otherwise, you know. But is there a way is there a threshold where maybe they're there doing too much or is that just too much of a broad thing to really even look at?

Adam: Is there a threshold too much for themselves as a.

Rob: Too much, too much advertising, too many staff bonuses,

Adam: Right,

Rob: Things like that.

Adam: And so that does go back to the architecture of the business model, which is what I said earlier, with conscious step where the impact gets made for every pair that's produced, regardless of what is advertising or operations of the business happen down the track so you can set the system up so that the incentives are in the right place. The then last point on this that it's worth noting is where society places its value on business success. So if somebody goes out and invents an app that is violent computer game and they make 50 million dollars for themselves, they get plastered on the front of Forbes as a business here. Now, if somebody spends their lifetime doing work, that means hundreds of thousands of people get access to clean water when they didn't and they happened to make a few million dollars for themselves, somehow they're portrayed as a criminal. But you put those two next to each other like, no, we all get a choice on where to invest our time and energy. And there is an opportunity to actually do really meaningful work, build a career out of that. That actually works really well for often with the early stage social enterprises that I'm working with. One of the first recommendations to have them is guys you got to start paying yourselves because so many people go into the process with that belief of I can't take anything for myself out of this. I'm doing this for a cause. Now, their ability to do more for that cause goes up dramatically when they don't have to worry about whether they can pay rent or not this week, whether they're going to make their mortgage payments. So this is this is what it means to have a sustainable organization. When you're creating something that is self-perpetuating and it makes an impact, then do that. Don't make it a complete shoestring approach just for the sake of maximising the impact. Otherwise, you end up with what what on Ted once referred to as the the ultimate bake sale. Great. We can all get volunteers and maybe we can put together a bake sale and raise a couple of hundred dollars for a particular cause. But if you can build a business that reliably generates impact and yeah, you need to spend a couple of million dollars a year on advertising and that generates a couple of million dollars an impact. Forget the bake sale. Go and do that.

Rob: Yeah, I mean, it's certainly an interesting thing to consider, and it probably leads into what I was going to ask next around trying to balance sort of the the purpose with the profit. And as you've rightly alluded to, a bigger machine, even if the the purpose side of it is slightly smaller margin, are, you know, coming from a bigger company, that percentage is going to equate to a bigger impact anyway. But in those early stages in particular, how do you sort of strike that balance between paying yourself, getting volunteers versus paid labor to? You know, it's probably a very complicated question, but is there a few things that you've sort of experience that might stand out there?

Adam: So one of the benefits of social enterprise is you can make some pretty bold asks of people around you, and that's how humanitix has ended up in partnership with that. And Facebook and Canva. Hey, we're doing good things for the world. Time for you to do your bit and do something dramatic as well. So that boldness is very important in the early days and something that should be leveraged as well. And again, it comes back to sustainability. The sooner that the core team can get to a point where they're in a good place from having a reliable income, that they can pay their bills and not worry week by week that will take them to a better place in the long run.

Rob: Interesting and thinking about established companies big and small, but say that someone has an ethical motive, that that sort of, you know, their, you know, their business is doing well and perhaps as a drive to introduce an ethical component to their company. Do you have any advice on, say, making it a fundamental shift in the company or just keeping it as a basically a corporate responsibility?

Adam: So it always comes back to core business because that's what will drive the business at the end of the day. So I have a such feeling for the CSR managers out there, the corporate social responsibility managers that are brought into huge companies and said, all right, now do really good things for us when their core business over to the side is still driving. Destruction of the rainforest in Borneo to do palm oil is still employing unsustainable mining practices in another part of the world or or funding that as the case may be. So this is why bolt on is it's not something I'd ever really recommend in large organisations. It's tough. And I just tell people, do what you can with what you've got, where you are, and that's enough. But if you are in a position of power within a large organisation, making those decisions about which core businesses you're going to allow can have a huge impact on going.

Rob: Yeah, I certainly think that, yeah, doing what they can with what they have and making some impact is still going to be better than having no impact at all, as you've said. So it's certainly something to bear in mind. So we've mentioned a few as a conscious step humanitix. There are some other ethical companies that you like to give a shout out to our listeners or our viewers.

Adam: Yes, sure, so this year for example, I really enjoyed working with Baraja, which is a Sydney based startup, making those laser sensors for self-driving cars, not what people would traditionally think of as a social enterprise. Until you remember, there's one and a half million deaths on the road every year. And if they can get self-driving cars to a point where they are the default, that will save millions and millions of lives over time. So there's some pretty exciting work going on around the world. And it was great working with you this year too Rob at Limeworks.

Rob: And it was good, it was so we're out of time and it's been a really amazing discussion. But for people listening who want to find out more about Adam Long, where can they find you?

Adam: They can jump on the ethical CEO dot com, where they'll see what I work on and what I'm offering to the world at the moment.

Rob: Amazing. I'm sure they'll find some great stuff there. Thank you Adam Long its been amazing. There you have it. I hope you really enjoyed this episode. And if you did, please like it, share it or leave us a review on your favourite platform. It helps us show more of this content to people just like you.


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