The New Business Ethos

My only post-graduate employment lasted 3 months. I worked for a small political consulting firm drafting online strategy for a well-funded land-use initiative. After the success of the measure, the firm’s founder sat me down, told me he loved my work but that the firm was not interested in continuing its web-based consulting. He had to let me go. It was in that same meeting that I decided to start – and pitched to my boss – my own business.

Without a business degree, experience, funding or family support I started WebRoots Campaigns. It seems insane in retrospect. But at the time, the process was so thrilling, so life-changing, that I would not trade those initial months for all the know-how in the world.

Being in consulting, I’ve encountered entrepreneurs from a broad array of industries. Some were as expected: those who wanted money and would do anything for it. Less expected however was the number of business owners who worked to a different beat – running their companies for wildly different reasons – all less motivated by the bottom line.

This group for the most part hailed from the ranks of new, young business owners. Some started their business fresh out of school, not even dipping into the employment pot for a taste of the promised land. Others, like myself, had a taste, spat it out, and went on to create our own soup.

While the intrigue of entrepreneurship is nothing new, the current economic and cultural climate has fostered a wave of young, untraditional businessmen (and women) never seen before.

The New Business
The emerging business class recognizes various motivations for their work and builds their companies to reflect these motivations.

This new business is in part a reaction to the shortfalls of traditional business epitomized by disregard for the environment, social equality and family. Once widely viewed as intelligent, lean and mobile, the corporation of the past century maneuvered unquestioned through our economic, cultural and political landscapes.

The new business reaction to this is to view business not as an end unto itself, but as a means toward something greater. Such a model does not insist that profits are bad, or that one requires world-changing ambition to succeed.

Profits are celebrated if the business creates value beyond the bottom line. A boutique furniture company which employs locals at good wages, buys from ethically sound foresters, and re-invests some capital back into the community is an exemplary model.

The entrepreneur may have founded the store because of love for his craft, to be near his family, or because he wanted to support his community. In any of these motivations, the pursuit of profit is inherent and accepted, but is balanced against other factors. It is only when the pursuit of capital becomes exclusionary, when it becomes absolute, that business begins to degrade the quality of both our environment and our lives.

The new model recognizes various practices, motivations and responsibilities throughout the business process. Such factors as the environment, social mobility, cooperation, community and family are not simply strewn aside in a dash for quick profits, but are strategically considered throughout the life of the business.

An Emptying Promise
An additional factor in the emergence of the young entrepreneur is the emptying promise of the traditional employment path, both economically and psychologically.

Forty years ago, relative wages were higher, health insurance more accessible, and mobility more lubricated; it was not uncommon to stay with a company for one’s entire professional life. However, real wages have been stagnant since the 1970s, while average working hours have increased over the same period.

Young Americans’ wages were already in retreat before the downturn. They appear to be suffering more since they lack seniority, contacts and, in part, because older Americans – their nest eggs now cracked – cannot retire and not make room for newer workers.

The young American psyche has also become weary of the traditional path. We are accused of laziness, of unwillingness to pay our dues. But when our dues lead only to more hours in a cubicle in an insatiable rat race to increase corporate profits for an illusionary beneficiary...well, the repulsion becomes understandable.

The emptiness of such a path has been understood by many over the years. Many have chosen to be musicians, artists, or activists. But as this realization spreads – not just to potential entrepreneurs but to consumers who are also increasingly weary of traditional business – the notion of “rebelling” against business through business itself is becoming a real option. A critical mass is being reached, both as a consumer base large enough to support this new business ethos, and as new entrepreneurs seeking to work with the “untraditional” businessmen.

The New Business as a Response to the Recession
The current economic crisis is obviously hurting traditional business and entrepreneurship. However, it will have a mixed effect on the emergence of new business.

On the down side, business loans or other investments are more difficult to obtain, consumer spending has plummeted, and the majority of all industries have stripped to their bare necessities in an attempt to weather the storm.

On the up side, the new business ethos provides a model that becomes a response to the roaring chaos. Many are losing their jobs after years of hard work for large enterprises. They are not only venturing out on their own out of economic necessity, but because of newfound realizations of the hollow promises of old business.

In many ways, the new business ethos is better suited for tough times than the old inflated, dog-eat-dog system because it recognizes the value of cooperation and remains more flexible than older models. In the face of a recession, those who are starting new companies are finding supportive communities where expertise, connections and even business is shared.

Consumers are also increasingly aware of the difficulties that smaller, local business are facing and are adjusting their behavior to help these local business stay afloat throughout the recession.

The risks are higher than ever, but the recession may provide a wakeup call for many Americans, and a crucial shift in how business is started and run.

Much praise has been given to new business models centered on community, philanthropy, environmental sustainability and cooperation. But we are only on the crest of the wave. Scan any business district and it becomes clear that old business still very much dominates the scene. MANY old companies are launching expensive PR campaigns to align themselves with the wave, but they still remain fundamentally flawed.

As consumers become increasingly sophisticated in this respect, opportunities will arise for business to be built on this new model. More likely than not, these businesses will be built not by the businessmen of the past, but by a new generation, with new rules, and hopefully new results.

Ilie Mitaru is the founder and director of WebRoots Campaigns, based in Portland, OR, the company offers web and New Media strategy solutions to non-profits, political campaigns and market-driven clients.