We found a new way to support our Non-Profit Literacy Partners

Funds Raised for Global Literacy:

$10,184,799.20

Books Re-Used or Recycled:

63,271,794

Posted by admin on 06.16.2009 at 1:24 pm

nplp-all

Great news! As you probably already know, promoting literacy has always been woven into the fabric of our business. Now we’re delighted to announce we’ve given an ownership stake to our non-profit literacy partners. Yup…we’ve granted Incentive Stock Options to these partners – as far as we know, a first for social enterprise.

The purpose of the plan, put together with the help of our primary investor, Good Capital, is to ensure that our literacy partners can have a stake in and share in our financial success.

We’ve put aside roughly 5% of the company for use in stock option grants to an initial group of five literacy partners (with potential to add others in the future): Books for Africa, Invisible Children, Room To Read, WorldFund and the National Center for Family Literacy.

One of our fearless leaders Xavier Helgesen puts it best: “We created Better World Books to show that it is possible to do good while at the same time run a successful company. Our literacy partners are essential to our mission, and we want them to flourish. Today’s announcement ensures that as our company grows, our partners will too.”

Check out the press release to get all the details. Or read more about it at Change.org.

3 Comments » | Tagged Impact, Our Partners, better world books, books for africa, Good Capital, Incentive Stock Options, invisible children, National Center for Family Literacy, room to read, Social Enterprise, social entrepreneurship, worldfund, Xavier Helgesen

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1. katie - June 16, 2009

so once again corporate america benefits on the back of good deeds. not surprising.

2. dana - June 17, 2009

I think it’s more like corporate America benefiting while still managing to do good deeds. The bottom line is that we are giving away part of the company in an effort to benefit our non-profit literacy partners. As stock option holders, our literacy partners will benefit as the value of the business grows.

Here are the details. Our non-profit literacy partners must earn these stock options by meeting their literacy goals. The nature of an option is the right-to-purchase shares at the current price (a.k.a. strike price – a low price per share) at a future date (when there is a high price per share). So the value of their right-to-buy will grow as Better World Books grows since the strike price never changes.

To be clear, we are GIVING UP part of our company so that our non-profit literacy partners will benefit as the value of the business grows. To Katie’s point, if big business ever tried to purchase BWB, this would act to preserve our mission, or at worst result in a windfall for our literacy partners.

3. Adam B - August 4, 2009

Sounds like it’s safe to assume that the strike price is so high that there is no reasonable chance that the non-profit partners will ever exercise those options. If that weren’t the case, I’m sure we’d be hearing about it.

Put another way, did you remember to include the values of those options on your balance sheets? How much were they? Would you offer to buy back those options in cash at that price?

Those are the only relevant details, none of which are contained in the press release. That’s why it’s simply a PR move and not a real donation.

Besides, as noted in the “IAQ”, those profits (underlying said shares underlying said options) are at least partially gained by selling donated materials. I think that’s Katie’s main point, and I think it’s valid.

B Corp isn’t quite doing its job, and shareholders should be concerned about the reputational risk BWB is generating, specifically through its shady campus acquisitions– how will BWB continue to be profitable once donors wise up?