Developing a sustainable business model

by Tamar Eisen

As most know, funding is one of the most vital components of creating and sustaining a business or social enterprise. Gabriel Mandujano, founder of Wash Cycle Laundry, discussed how to sustain funding in his workshop Sustainability in Community Based Business Models. He introduced the session with a description of his own business model, in place at a company providing second chance employment for vulnerable adults through sustainable laundry delivery.

After providing delegates advice about funding their specific projects, he split them into small groups in order to workshop these suggestions. Mandujano has found the most common model for sustainable businesses is for funders to give money to the venture which will, in turn, provide services to the beneficiaries. Yet, he encouraged the delegates to think beyond this model, and question the assumption that the beneficiary does not have money to contribute to the project. He stressed that beneficiaries can be potential sources of financial support for the venture if they do have the funds. There are other stakeholders who are also benefitting from the beneficiaries and it is important to take this into account.

In terms of funding sources, Mandujano presented a graph that showed that, of the $350 billion philanthropy dollars in the United States, only 3% comes from corporations, 20% from foundations, and the rest comes from individuals. He revealed that the majority of nonprofits that have achieved scale in the US have one funding base, so he recommended sticking to either individuals, foundational or corporational support and not switching between different funders. He stressed the importance of finding third party funders, as this can really bolster support for project funding. Nicholas Wayne, an international delegate from South Africa, “really enjoyed how he taught [them] how to identify sustainable forms of funding and how to utilize third parties, which is something [he] did not think about before.”