Making the Pitch

That which seems too good to be true, usually is.

We’ve all heard this old maxim, and most of us have adhered to it at one point or another in our lives. It echoes down from the same center of higher reasoning that narrows the gazes, furrows the brow, and flouts our most emphatic desire to believe that yes, one can in fact eat three square meals of ice cream a day and still obtain the figure of a Brazilian supermodel. “All you need is this little pill!”

Right.

We are hardwired to be skeptical, and as late-night infomercials prove, with good reason. A plethora of products and services attract business by attempting to offer something for nothing. Even sectors typically wrapped in the trappings of legitimacy are not immune (mortgage-backed securities anyone?).

In any case, the recent financial crisis, and a pervasive sentiment that the American public was more or less duped, has done little to increase the amount of goodwill and institutional trust in circulation lately (see Gallup).

With this in mind, imagine making the following pitch the executive director of national NGO:

Hello, we are launching an enterprise whose sole purpose is to generate money for you. This money will cost you nothing, and will come with no strings attached. Eligibility requires partnering with us, but partnership is free and the application minimal.

Sound good so far? Here’s the hitch –

Where does the money come from you ask? Well it’s generated from real estate transactions….

….aaand cue prefrontal cortex. If you’re a reasonable person, the odds are good you smell a scam. And with good reason. This pitch is an unholy union: too-good-to-be-truedom joined with one of the most besmirched and emotionally sensitive nouns of our day – real estate (currently surpassed by perhaps only “Wall Street” in it’s ability to evoke visceral reactions and connote crumbling pensions, delayed retirement, and scamming of epic proportions).

Considering that a win-win-win business model should be the goal of every self-sustaining social enterprise, it’s surprising how tough a sell this model can be. The questions on everyone’s lips are the same – where’s the catch? How do you benefit? For some reason, the truth – we benefit by seeing you benefit. More money flowing to your organization and others like it is our metric of success – doesn’t necessarily resonate.

And so, there’s no shortcut at IIC. With each phone call, each email, and each meeting we present our win-win-win model in full, and we defend our intentions against the skepticism, disbelief, and uncertainty (you can practically hear the brows furrowing on the other end of the line).

Win #1: The Consumer

–        Individuals, corporations, institutions, or organizations with a real estate need can see their real estate transactions generate funds for local, national, or international NGOs. These may be organizations that they already feel passionate about, and already donate their personal time and money to, or NGOs they have never been able to support before. Now their philanthropy can be augmented at no personal cost. IIC turns real estate transactions into a new tool for corporate responsibility, a means for 501c(3)s to directly support themselves, and the catalyst for average consumers to become philanthropists. And it costs none of them a penny, because…..

Win #2: The Broker

–        Real Estate is competitive. Brokers are constantly looking for new clients, and a standard way they obtain business is through industry referrals. When a broker is referred a deal, he or she will pay a referral fee to the referring broker. This fee is almost always 20-30% of the commission that he or she will earn. But, as my boss says, 75% of a deal you don’t yet have is a whole lot better than 0%. So brokers don’t just tolerate referrals, they love them! IIC connects brokers to an emerging, newly organized market of socially conscious consumers. Given the choice between a standard broker and an IIC Broker Member, these consumers will certainly prefer the IIC Broker, who will pledge at least 10% of his or her commission to the client’s preferred NGO.

IIC Broker Members are still competing for business- against one another and against the broker community at large. Market pressures will naturally keep them from passing on the cost of their pledge to clients in the form of higher commission fees. Furthermore, annual dues for IIC Broker Members are little more that the cost of a single weekend ad in the Chicago Tribune. In exchange, they get access to a new client base, a personal profile on the IIC web site, and a listing in the IIC searchable database; all while gaining positive publicity, differentiating themselves from competition, and retaining 90% of their commission on all IIC deals!

Win #3: The NGO

–        It’s no great secret that NGOs expend an enormous amount of time, effort, and resources just to “keep the lights on.” All of this energy is diverted from what they ideally should be doing: implementing programs and executing their mission efficiently and effectively. IIC provides NGO Partners with access to a stream of unrestricted dollars, generated by the real estate transactions of their corporate and/or individual supporters. Partner profiles on the IIC site also increases NGOs’ exposure to a national and (eventually) international audience.

Partnership costs NGOs nothing, and requires minimal effort. To benefit, they need only alert their supporter base to their partnership in IIC, and explain the opportunity for their supporters to generate funds for them through real estate transactions. Of course, there is no guarantee that an NGO will benefit from partnering with IIC- that will remain the prerogative of their supporter base.  But they have lost nothing in the process. The cost-benefit ratio for NGOs is simple: zero cost. 100% benefit.

Happily, after hearing the full pitch more NGOs decide to partner with us than not. We are currently at 64 Partners and counting, while only 48 of the 120 formally invited NGOs  have declined. Yet a surprising number of NGOs fail to respond to our initial outreach.  Or perhaps it’s not surprising. We’ve been taught since childhood not to expect something for nothing, and distrust of Corporate America is running so high that even a social enterprise can appear suspect through association (re: real estate).

It has taken the private sector some time to come around to the idea of double or triple bottom line companies, and the notion that organizations that can do good while generating a revenue stream to support themselves. As the experience of IIC suggests, it may take the NGO sector some time to accept the concept as well.

So what’s our new strategy to break through these suspicions? Share a Chicago Sun Times article with our invitees. Heck, with the trust of 25% of the American public, at least the papers are still beating the banks….