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KAI RYSSDAL: There are a couple of things every new business needs. A good idea. Hard work. And cash. Most companies do okay with the first two. But item three can be tricky. Especially when it’s social entrepreneurship we’re talking about. People who’re using business to help change what needs changing in this world. From his post at the Entrepreneurship Desk Marketplace’s Steve Tripoli’s been taking us inside some of those companies the past couple of Mondays. Today we focus on a small-but-growing source of money for them.
STEVE TRIPOLI: In the peculiar way New Englanders talk, the further up the Maine coast you go the more you’re “Down East.” Whiting, Maine’s, about as “Down East” as it gets — almost to Canada. Here in remote Washington County there have been two economic mainstays for generations — wild blueberries and fish. Very few people have grown rich off either of them.
The canning line at the old A.M. Look Company is turning out fresh-packed fish and chowders full-throttle these days.
CYNTHIA FISHER: What we’re doing today is lobster bisque. This is minced lobster …
But a few years back it nearly went silent after 85 years. Business was lagging badly. Then Maine native Mike Cote and his partner Cynthia Fisher said they’d revive the cannery. Mike was from these parts and they both were on a mission to bring jobs to the struggling region. But up here where the economy almost never booms, Fisher remembers skepticism at their plan.
FISHER: Because I believe even the people here wouldn’t believe that anybody would come here and try to make a business go. Because there is this myth in these areas of Maine that it just … there’s nothing that’s gonna happen here.
Something’s happening now. Look’s is now Bar Harbor Foods. Sales have jumped from $800,000 to $5 million in four years. And the workforce has gone from six to 24 full-timers with good benefits.
Cynthia Fisher says doing business in communities that really need jobs is part of what made them stay here.
FISHER: You could do this business much easier anywhere else. Logistically, it’s a nightmare. But, yes, there’s a huge benefit to this business. This is a business that was started here, based on people who live here, and work here. And I just think that we both see that as a responsibility, to keep this business alive here.
Fisher and Cote are turning their entrepreneurial challenge into a marketing tool. They’re using Bar Harbor’s rebuilding story and sense of place, plus a new commitment to sustainable fish harvesting to hook new customers.
But they couldn’t pull it off alone. It took a special kind of investment capital to remake the old dockside cannery. Cynthia Fisher describes Bar Harbor’s backers this way:
FISHER: They understand, especially being in Maine, that these things just don’t change overnight. We have a few more challenges and they’re willing to hang in for the endgame.
Giving an investment more time to work is what venture folks call “patient capital” — and it’s Nat Henshaw’s specialty. Henshaw heads CEI Ventures down in Portland. It’s one of several firms that finance community development in the Northeast.
Like any venture capitalists worth their salt, Henshaw and CEI’s backers are in it for the money. But it’s not just about profit for them.
NAT HENSHAW: We speak in terms of a triple bottom line — the environment, social equity, and of course the financial bottom line. It’s not sustainable if you don’t have a financial bottom line. No one’s gonna invest.
The cannery met several of CEI’s social-investing goals. So the firm pumped in $600,000. Most VC’s won’t even consider a deal that small because they say the transaction costs are too high.
But investing small amounts in struggling rural Maine has mostly paid off. Two of CEI’s three venture funds have done well for investors, the third one just OK. And companies they’ve funded have grown from a combined 1,300 workers to twice that.
Before taking on Bar Harbor Foods, Cynthia Fisher and Mike Cote were making more money in other careers. But Fisher says that when they turned to social entrepreneurship they started looking at a bigger picture.
FISHER: You know, to me the journey is the adventure. Along the way, if you come out with some satisfaction that you did some good for the place you were in, the continuance of the planet, and the people that you may have affected their lives in a positive way, then that in itself has to be, part of the reward.
In Whiting, Maine, — way Down East — I’m Steve Tripoli for Marketplace.