Giving is Good (For Business)

            TOMS Shoes is a company based on a strange business model.  For every pair of shoes that they sell, they will give a pair to a child in need somewhere in the world. The business started when Mycoskie was on vacation in Argentina.  After learning to tango and play polo, Mycoskie ended up doing a shoe run with a couple of English speaking volunteers he met in a café.

            During this shoe run Mycoskie encountered a sensation that would not only lead to the founding of TOMS Shoes, but the unique business model that has led to TOMS Shoes being heralded as the solution to fixing capitalism.

            This shoe run, in which volunteers go around to wealthy families to pick up slightly used shoes and give them to poor children who have no shoes and therefore cannot go to school, exposed Mycoskie to the joy of giving.

            After witnessing the children's joy over something as simple as a pair of shoes, Mycoskie was high on emotion.  This elation was somewhat short-lived as, later that same day, he spoke with his polo teacher about the experience. Though approving of Mycoskie's activities, his polo teacher asked him a very important question, the fateful question that fertilized the potential the shoe run had implanted. He asked what would happen whenever the shoe were worn out or outgrown.

            "If there was no plan to get those kids their next pair of shoes then all I was doing was making myself feel good," Mycoskie said.

            This revelation led Mycoskie to pursue a solution to the problem.  He considered traditional charities at first, but then realized that even with charity the money would eventually run out and he faced the same problem.

            That is when he decided that if he were to run a for-profit business that would give a pair of shoes for every shoe sold, he would be able not only to provide more shoes for children in need, but he would have a viable method for sustaining the giving.

            This uncommon, unusual idea ended up being more than just a weird quirk to a normal shoe business, or something to help Mycoskie feel good, it ended up embodying the fledgling business and defining its role.

            "The central theme of this talk is, ‘Giving feels good, and that's okay,'" Mycoskie said. "And it's good for business too."

            Mycoskie claimed that giving was not only a viable business method, but that it was one with the potential to revolutionize business. He went on to outline three key reasons why giving is something to incorporate in a business model.

            His first reason was simple: customers become marketers. He embellished this point with another anecdote. In JFK airport Mycoskie saw a stranger wearing a pair of TOMS Shoes. Acting casual, he mentioned that he liked the shoes and went back to what he was doing.

            "She reached out, grabbed me by the shoulder, turned me around and said, ‘No, you don't understand. This is the most amazing company in the world,'" Mycoskie said. He went on to discuss how if her reaction was that strong to a complete stranger, then how much she must have mentioned his product and mission to family, friends and co-workers. 

            "I realized then that, because of our customers, we'll never have to rely solely on traditional marketing," Mycoskie said. "Then I wondered how many children have gotten shoes just because of this woman."

            Mycoskie's second reasoning: you attract and retain committed employees. People enjoy working for TOMS Shoes for the same reason that they enjoy buying TOMS Shoes.  It makes people feel good when they realize that they are a part of something. That the work they are doing is making a difference.

            And Mycoskie's final point: people want to help you out.

"People want to see you succeed," Mycoskie said. He explained how from early on he had some major companies reaching out to partner with him. 

            Ultimately, Mycoskie's ‘Giving is Good' business model seems like a complete inversion of a popular '80s mantra. TOMS Shoes is even expanding their market, and is set to reveal other products in the near future that will work on the same one for one giving model that TOMS currently employs with shoes. Shaping a business around the idea that people like helping their fellow man is a bold idea. And while it plays hackie-sack with traditional altruism, while simultaneously spitting in the face of traditional business ideas, there can be no question that Mycoskie's brainchild is doing an awful lot of good in the world.