Weak Made Strong
The Surprising Resilience of Freedom Businesses Amid COVID-19
by Rachel Rose Nelson, Executive Director of Freedom Business Alliance
Impact investing is on the rise and needed more than ever to accelerate solutions to global challenges created by COVID-19. But how do investors engage with businesses that are high-impact but face high social costs as well? Prior to the outbreak, many faith-driven investors were attracted to the compelling promise of Freedom Businesses with their mission to employ vulnerable survivors of human trafficking. But few ended up actually investing. The reason: many of the businesses have been seen by investors as too reliant on charitable donations. But it turns out this supposed weakness has proven to be a source of strength amid crisis.
Admittedly, businesses that exist to employ survivors seem to operate in an upside down model. Where most businesses seek to hire the best and brightest, Freedom Businesses hire the uneducated and traumatized, resulting in unusually high social costs, even by most social business standards. Freedom Business Alliance has gathered more than 75 of these businesses together, almost all founded by leaders compelled by their faith to offer employment to this vulnerable population in order to reverse the harrowing statistics shared by Thomas Reuters Foundation that show 80% of survivors are re-trafficked absent dignified employment post-rescue. The business model defies worldly wisdom.
“After returning from months in India, I understood lifelong freedom for women trafficked for sex was dependent primarily upon sustainable employment. Business undergirded with holistic care is the key. Yet, a few business leaders advised the risk was simply too great,” reports Ryan Berg, Founder of Aruna, an athleisure-wear company focused on building a community of freedom champions around their brand. “Doing nothing was not an option. So I launched a nonprofit first. And out of the community surrounding the nonprofit, we then launched the business.”
This kind of hybrid model throws investors off, even faith-driven investors, committed as they are to supporting businesses that benefit the vulnerable. Yet it’s a model that has been adopted, in a variety of configurations, among most businesses in our Alliance. This hybrid financial, legal, and operational structure, while somewhat experimental right now, is justified given the extraordinarily high social costs of employing survivors. These businesses offer employee development resources unheard of in most countries, let alone the developing economies in which many of them operate. Services include vocational training, life skills development, trauma counseling, paid sick leave and more, all necessary to accommodate the needs of survivors, and transform them from unemployable to highly valuable team members, even leaders. It’s a transformation that can only be accomplished through dignified work within supportive community. And, as it turns out, people are willing to support that kind of transformation with sizable donations.
When COVID-19 hit, the mission of our organization to scale the Freedom Business movement was under threat of being entirely undone. These businesses are seemingly fragile, many not yet profitable, and all operate according to new rules being written realtime, often as a result of trial and error. And indeed, as our team made the rounds in reaching out to our members, we found more than half saw sales drop by over 75%, with no grants available from Uncle Sam since those they employed were primarily overseas. But in a second round of outreach, much to our surprise, things were looking better not worse. Many had launched their own fundraising campaigns, flexing the nonprofit side of their operations to garner support, and getting it. We shouldn’t have been so surprised. God promises that in our weakness his power is made perfect (2 Cor. 12:9). And the generosity that has risen in support of these intrepid businesses is nothing short of a display of God inspiring the hearts of many to lift the weak to a place of strength.
Where some within our movement have in the past called for abandoning the donation-based structures integrated into so many of our constituents’ businesses for fear it weakens their business discipline and disqualifies them from the game, perhaps we should instead adopt the Apostle Paul’s mindset when he declared his “delight in weaknesses, in insults, in hardships, in persecutions, in difficulties. For when I am weak, then I am strong.” Businesses that some have discounted as weak due to the social costs and extreme challenges of employing at-risk populations have turned out to be surprisingly resilient in crisis. It turns out that solidarity with survivors may just bake survival into their DNA.
While proven structures and models must certainly be defined in this new, hybrid business realm, the values-based investor would do well to allow for people’s generosity to shine forth in a new type of partnership between the invisible hand and the helping hand. Only then will we see just how powerful God is in moving forces for good even when all around us things may seem to go bad.
FOR MORE INFORMATION ON COVID-19, PLEASE SEE OUR PAGE HIGHLIGHTING SOME OF THE BEST RESOURCES OUT THERE FOR FAITH DRIVEN INVESTORS & ENTREPRENEURS IN THIS SEASON.