I recently got a chance to chat with Alex Husted, Co-Founder and CEO of HELPSY about Social Entrepreneurship and how people can break into this field?
To get started, can you give an introduction about yourself and HELPSY?
I went into business almost four years ago with two friends of mine. We were looking into investing in small businesses that we could modernize, build, and grow. Businesses that hadn’t transitioned to the 21st century in any way, that kind of thing.
We started looking around and we discovered the whole used clothing industry through business that we found for sale in New Jersey. It was a total revelation to all three of us that this whole secondhand world existed. We had no idea that used clothing was “a thing” and we were instantly fascinated by it because it was not only a profitable business, but it was also great for the community and great for the environment.
How did you feel when you had the realization?
It felt totally foreign. It makes you feel stupid to realize that there’s this whole industry going on kind of right under your nose. And it’s not small. It’s not a tiny little industry. It’s a humongous industry with billions of dollars in trade internationally every year.
Any challenges which you encountered across your journey?
We did certainly face some because we started with acquisitions. We needed a large lump sum of money to buy these businesses, and each one kind of had its own idiosyncrasies. The most difficult part was getting a bank to lend us the money for the acquisitions. So, we talked to and negotiated with every bank we could possibly find. We ended up getting a deal with a small community bank through an SBA program that helped us get the ball rolling. It was tremendously difficult to get somebody interested in lending because our business plan did not fit any mold that lenders were used to backing.
Did you have a mentor that helped you?
So, we have a few people that we got to know through networking in the trade association. We were able to find some folks that were interested in helping us out and teaching us the ropes as the new guys. We also leaned on the former owners of the businesses we bought for advice.
Why social entrepreneurship?
So, for us, it means that business is more than just making a profit. My partners and I invested in this particular business because it is very much a triple bottom line model where there is an opportunity for us to do good for the environment, do good for the community, and be a successful business as well.
What does social entrepreneurship mean for you?
There are a lot of people out there in our industry who want to maximize the profit for themselves and pay everybody minimum wage. We have a completely different perspective on how we operate our business.
Why are we seeing so few entrepreneurs with this point of view?
What comes to mind first is the confusion between things like social entrepreneurship and being a nonprofit. There’s a common misperception that if you are focused on social good then you belong in the nonprofit realm. This is completely untrue.
So how can we rectify this situation as a society?
I think you can start by taking a more careful look at the nonprofit things you do in your own life. When you get an email or you get a link that somebody sends you on Instagram, asking you to donate money to some cause, whether it’s starving children in Ethiopia or save the whales or get plastic out of the ocean or any of these things that sound like fantastic causes to support, take a little time to do the research into it. Investigate how legit the nonprofit recipient is and I think you’ll often be surprised at what you learn, mostly because there’s just a lot to learn. Understanding how these nonprofits operate and how they spend your donations is really enlightening. Once you start digging in, you will realize that there are ways to really leverage your donation to get more bang for your buck and feel better about doing it.
What advice you have for people that are looking to break into this field?
It is certainly daunting. Social Entrepreneurship adds more complexity and difficulty to the entrepreneurial undertaking which is already a tremendous task. However, there are folks out there who can give you advice. Helpsy has cemented our Social Entrepreneurship standing by becoming a B Corp. Talking to owners of other B Corps is a fantastic way to get advice on breaking into this field.