In last week’s post on Assembling the Team for Natural Enterprise* I promised that I would present an Elevator Pitch for such enterprises. Although this post is too long to deliver in an elevator ride, it does explain what Natural Enterprise is and why you might want to set one up or join one.
What is Natural Enterprise? Why is it different?
What’s the catch? How do I set one up?
* What’s In a Name? I have used the terms New Collaborative Enterprise, Existential Enterprise (Charles Handy’s term), and New Tribal Ventures (Daniel Quinn’s term) to describe such enterprises. The ‘new’ in these terms suggests there are ‘old’ collaborative enterprises, the term ‘existential’ has been voted off the island by readers of this blog as too highfalutin’ and intimidating a term, and terms like ‘tribal’ conjure up images of war paint and noble savages. Autopoietic Enterprise (it means self-creating and self-managing) is accurate but unpronounceable and would probably be perceived as pretentious. Readers have suggested the terms ‘Natural Enterprise’ (Harold Jarche) and ‘Organic Enterprise’ (Don Dwiggins), which I like because they’re simple and descriptive. I like Natural better because its opposite (unnatural) is exactly what the modern corporation is, while the term ‘organic’ is a bit ambiguous (it means ‘related to organs’, ‘related to organisms’, ‘carbon-based’, and ‘instrumental’, of which only the second definition is a propos). I’ almost decided to keep ‘Collaborative’ in the term for two reasons: To stress that these enterprises entail more than one person working together (a sole proprietor, to me, does not an enterprise make, even if s/he is a powerful networker — enterprises are about people making a living together), and because it would allow me to continue using the acronym NCE, which has gained some common parlance over the past year. But in the end, simpler is better, Natural Enterprise is inherently collaborative, and I was taught ‘when in doubt, leave it out’. So Natural Enterprise it is — thanks to Harold for the inspiration. |
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How about just “Collaborative Enterprise”?”Natural” just sounds too Birkenstock-ie to me…
Actually, looking at the table of comparisons, this sounds like a Confederate Enterprise. Hope its not as doomed as its brethren, the confederate government.Your table is biased of course, I would be curious to see how you view the difference between the two on: access to capital, ability to make difficult changes, stability, resistance to latent personality disorders, and their ability to make long term commitments.
Hi Dave in talking about this model yesterday, on eof the issues that arose was how banking looks at these structures today – some do exist – the bottom line is that the banks do not know what to make of them. Our Aha was that very soon, some of the more successful NE’s will start to invest in smaller emergent ones and that just as the emergence of modern banks drove the late industrial period so NE’s will become the new financiers of the new economy.
Rob: Yes, in fact there’s no reason why that shouldn’t be the purpose of some NEs — the ‘natural’ successor to credit unions. But the financing should be very short-term. Debt is abhorrent to natural systems.
Maybe not debt at – sharing resources, clients, information
So basically it would be a NCE bank? Would that NCE own part of other NCEs or would they instead gain some kind of fee for their services of lending capital or advise etc.?
Casey: There are many creative ways of funding assets. Leasing instead of buying allows you to amortize the costs and the cash outflows over the same period as the revenues, so you need no capital loans. An older, cash-rich partner may choose to contribute capital assets to the enterprise in exchange for investing less hours into the business, so the cost of capital would be very low but the ROI for the investing partner better than he can get in the bank. Receivables can be ‘factored’ to a NE ‘bank’ on a revolving short-term basis. Inventories in most entrepreneurial businesses are negligable, since most such business make products to custom specs and just-in-time, so the customer essentially finances them. So with a cautious spending strategy, and reinvestment of profits (organic financing), most NEs shouldn’t need to borrow often, or give up capital at all. The NE ‘bank’ might earn as much by giving sound advice on when and why *not* to borrow as it would make by short-term lending. I see NE ‘banks’ as community-based lending institutions that would really act as intermediaries to connect people in the community who want to invest in their own community with those with short term needs and with local public utilities (e.g. community energy co-ops) with longer-term needs. Keep your money in the community where you can keep an eye on it and see the benefits that accrue from it. For more ideas, just ask any woman who manages the family finances ;-)