Why Canada Needs Employee Ownership: A Next Economy Conversation with Peter Deitz

Movements across the globe are calling for systems change to build a world that is sustainable, equitable, and prosperous for all. But what will that world look like, specifically? It’s easy to get lost in the jargon or talk vaguely about broad topics. What tangible policies, models, and actions will create the world we want to see?

Next Economy Conversations, our monthly tête-à-tête with industry leaders, brings the people building systems-level solutions to the table to break down their approaches, provide key insights, and learn from their successes and failures. Building the Next Economy requires all of us. Welcome to the conversation.

For our latest Next Economy Conversation, serial entrepreneur and old friend of CSI’s, Peter Deitz, took us on a deep dive into Employee Share Ownership Plans (ESOPs). We’ve broken down his key insights below and you can watch the full conversation here:

Over the past two years, Peter Deitz has championed and helped oversee the formation of an Employee Share Ownership Plan for Grantbook, the organization he co-founded. Started out of CSI Annex in 2012, Grantbook has grown into a twenty-five person philanthropic advisory firm that helps foundations operationalize mission and vision by leveraging technology. 

Peter actually began looking into ESOPs as an effective and ethical continuity strategy for Grantbook so he could mindfully exit the company to pursue other interests full-time. His pursuits quickly grew into Unwrapit, a social purpose business that provides companies with digital alternatives to traditional corporate and event gifting practices in order to reduce waste destined for landfill and create meaningful, personalized connections. 

With that, let’s get into it. 

What is an ESOP? 

As Peter explains, due to current Canadian legislation, “there’s no simple answer to what an ESOP is.” Right now, unlike the US and the UK where clear frameworks exist, converting to an ESOP is a bespoke endeavour, making a hard-and-fast definition a little difficult to come by. 

According to ESOP Builders (the Canadian consultancy firm Peter worked with to customize Grantbook’s plan), ESOPs are “stock equity plans that allow employees to acquire ownership in a company, heightening employee buy-in and investment, while fostering accountability and an ownership mentality. They may include stock options, stock purchase, phantom-stock ownership or a combination of alternatives. Employee ownership can range from [less than] 1% to 100% of the company. As employees become owners, they share in the risks and rewards of the company.” 

At their core, ESOPs are one way to enable employee ownership. ESOPs differ from worker co-ops in ownership and governance structure. Today, we’ll be covering Grantbook’s version of an ESOP (a version Peter mentioned could also be called a “Shared Purchase Plan.”… It can get confusing. Stick with us!). 

Why should you care about employee ownership? 

Before we get further into the nitty gritty, let’s skip straight to what really matters: why should this matter to you? Well, wealth equity for starters. 

Employee ownership builds community wealth. As our CEO, Tonya, explored, “I see ESOPS as a fundamental strategy for the redistribution of wealth to those who have not otherwise had it historically. It’s a powerful tool for reconciliation and for inclusion in our economic systems.”

And there’s more. ESOPs also improve business performance and create economic resilience. As Peter emphasizes: 

“It generally has bipartisan support [in the US] and there is a strong financial case for this model. There is actually no limit to the positive systemic effects [ESOPs] can have. Whether with respect to economic opportunity and growth, racial discrimination and justice, building businesses that take into account what environmental and social effects they have, ESOPs and employee ownership can have a big impact across all of those realms.”

Why should an organization embrace employee ownership? 

Peter explains: 

“Why would I, the person who controls the founder’s shares, decide to do this? Because it was the right thing to do. Just at the most basic level. Employees create the [company’s] value, especially in a professional services firm. They have, in my view, every right to be in the ownership mix and to own a portion of the business. Ethically and morally, I was on board, and that’s why I started looking into it. 

Then I found out it’s the right answer to multiple questions, like how do you achieve greater retention in your organization? How do you create greater growth and margins? Employee owned companies generally perform better on traditional financial metrics of success.

How do I exit and preserve the culture? How do I exit and achieve some liquidity from this investment of these shares I own, but do it in a way that is going to create the most benefit for Grantbook and its employees? 

The same journey that brought me to [building] social purpose businesses is the journey that brought me to employee ownership as a continuity and exit strategy that makes sense.”

Breaking down Grantbook’s ESOP structure 

When it comes to Grantbook, an Employee Share Ownership Plan means “employees have the opportunity to buy an ownership stake in the business.” 

Peter breaks it down further: 

How do employees acquire ownership? 

“Specifically, employees own outright shares that they’ve either earned into or purchased. The difference [between earning and purchasing] is that a certain number of employees who […] saw Grantbook through an especially difficult periods earned a portion of the shares set aside for employee ownership. Everyone else, including those employees, have had the opportunity on an annual basis to buy additional shares at fair market value (as an independent third-party determines it to be). 

Anyone who works at Grantbook for more than a year is eligible to participate in the ESOP. Everyone can participate equally. There is no differentiation based on seniority (meaning no one can purchase larger portions than someone who is new to the business or earlier in their career). Everyone can buy equally each year. 

Each year employees receive dividends on the shares they own. That’s a unique quality to the form of ESOP we have. [My understanding of other ESOPs is they typically] don’t pay dividends [and there is no payout] for employee owners until they leave the company.”

What does governance look like? 

“Right now, Grantbook is at about 21% employee ownership and we have a pathway to at least 30% ownership over the coming years.These are voting common shares. They are not proxy shares and they are not non-voting shares. So if there’s ever a decision that goes to shareholders, anyone who is an employee owner can vote using their common shares. 

The ESOP group can nominate a director to the governing board of Grantbook. That was actually just triggered when the ESOP group surpassed twenty percent so we’re in the process right now of figuring out how [that process will work] and who will sit on the board as a full [ESOP-nominated] director. It could be an employee owner or the employee group could choose to have an independent director represent them at the board level. That is their decision. 

For decisions that go to shareholders, the number of common shares you hold will determine the votes. Not many decisions will go to shareholders. For decisions that go to the board, employees will be represented through the director [they appoint].”

When a staff member leaves, what happens? 

“When any staff member or employee leaves, their shares in the company can be bought out by any other shareholder. What that means in practice is any other ESOP employee owner has an opportunity to buy those shares at the current valuation. If no other shareholder will buy those shares, the corporation is obligated to buy them back. An employee that is no longer an employee is also no longer a shareholder. That’s how we’ve designed our ESOP.” 

How do employees feel about it? 

Sara Saddington, Grantbook’s Content Lead, jumped into the conversation to say, “I’ll be eligible to buy in the next round. The B Corp ESOP was a big part of why I joined the team. [There are] definitely some great cultural benefits to this structure.”

That’s right. Grantbook also has B Corp status (another topic we deep-dived into for a Next Economy Conversation with Kasha Huk of B Lab Canada). Peter mentioned how Grantbook’s B Corp ESOP structure empowers all shareholders – employees and directors alike – to take on multiple stakeholder perspectives, including the planet’s. This feature contributes to a values-aligned culture and governing model employees can thrive in: 

“Over time, our B Corp status and employee ownership feature will become the cultural centre of gravity for Grantbook. I think what they do for employees is create a psychologically safe workplace. They create a workplace that has deeply rooted values and they create economic opportunity.”

If ESOPs are so great, why isn’t everyone doing it? 

As this report from Social Capital Partners outlines, implementing an employee ownership program in Canada is a very difficult process. For Peter, the journey was slow and often tedious. We need policy to change that because as he explains, ESOPs have the capacity to radically disrupt the way we do business for the better: 

“There are trillions of dollars in wealth currently held in ownership of business that will be transferred over the coming years because baby boomers who hold a lot of that are retiring or enlightened owners of business who want to move onto something else don’t have an easy button to embrace what we are talking about. It was exceptionally hard work to get to where we are with Grantbook’s ESOP. If a group can make it easy to turn any kind of company into a partially or fully owned employee company then the impact on Canada’s economy and on the global economy would be unlike any other intervention that could be made in the capital markets. This is an immensely powerful tool.”

Want to hear more from Next Economy leaders? Subscribe to our weekly newsletter so you can be the first to RSVP when we host our next conversation.

Six Big Ideas for the Next Economy

Lightbulbs drawn on dusty black chalkboard

At CSI, we believe we need an economy that is regenerative, equitable, and prosperous for all. Since 2012, we’ve been supporting nonprofits, social entrepreneurs, activists, and advocates as we work toward this Next Economy together.

The COVID-19 pandemic has made it impossible to ignore the failings of our current systems. Racism, poverty, the climate emergency: every time we look at a problem, we find our economic structure holding us back. If we’re going to make the world better, we need to design an economic system that puts people and planet first.

Luckily, many people and organizations from around the world have the same idea. They’ve been innovating new solutions, championing community-based, circular, participatory, equitable models that prove a Next Economy is possible.

Next Economy Conversations powered by Fiix is an opportunity to meet these leaders and hear about the solutions they have built and implemented. Tonya Surman, CSI CEO and serial social entrepreneur, facilitates the discussion, incorporating questions from the live audience. These conversations help us all learn, reflect, and integrate these ideas into our own efforts to build the Next Economy.

2021 is going to be a year of recovery, and we need big, bold ideas to get us started. We’ve chosen some highlights from each of our past events to cover in this blog, but if you want to fully immerse yourself in their work and optimism, you can watch all our Next Economy Conversations in full here.

On This Page

Failing so we can succeed

For our first Next Economy Conversations, we asked Bill Young to join us for a discussion about how he founded Social Capital Partners and why failure is necessary in creating systems-level solutions.

The thing about systems change is: it’s risky.

“Most funders don’t like funding things that aren’t working,” said Bill. “So the tendency is ‘let’s do things that will work.’”

Social Capital Partners is lucky to have independent funding. It means they have the freedom to experiment, to push boundaries, to do things that are inherently really, really hard.

“We flipped the script and said ‘no, we aren’t succeeding unless we are failing,’” Bill explained. “We will fail because we are trying stuff that nobody else is going to try. And that’s our role.”

They’re always aiming for the greatest impact they can have.

“How do we transform this economic landscape in the most powerful, equal way? How do we solve inequality? If we saw that what we were doing wasn’t going to get us there, whether it was branded a success or failure, it didn’t matter to us.

“To us, it’s kind of like a maze. In the centre of the maze is the magic of the biggest impact you could possibly have. To get to the center, you hit a lot of dead ends. You need to hit those to get to the centre. So we never look at failure or success as either failure or success. We look upon it as part of the road map on the way to have the most impact we possibly can have. ‘Is this the route to get there?’ If it isn’t, we change. Success and failure has nothing to do with it.”

Creating community-based solutions

Jeff Cyr of Raven Indigenous Capital Partners joined us in June to discuss what Community-Driven Outcomes Contract (CDOC) are and how they are serving the Indigenous community. This innovative new investment vehicle is changing the game in Canada — connecting social finance with deep-rooted respect for community.

The idea of an Indigenous intermediary came to Jeff a few months after the inaugural Indigenous Innovation Summit. His conversations with Indigenous entrepreneurs leading up to, during, and after the summit revealed massive barriers in access to capital.

“What didn’t exist was Indigenous investment vehicles. That’s the problem. We said: ‘We need Indigenous equity. I wonder if we can raise capital from the non-Indigenous world to invest in Indigenous enterprise and prove that this can be done.’”

They did! Raven Capital completed their sixth investment in June 2020. All of their ventures so far are promising — and one in particular sparked the development of a new social finance model for community-based solutions.

In a CDOC, the community in question determines its priorities and how they’re going to get there before they look for capital. It places control into the hands of the beneficiaries, rather than external parties that don’t fully understand the problems they’re trying to solve.

The CDOC itself is basically a pay-for-performance model: private investors upfront the investment and tag a rate of return based on success. The Indigenous social enterprise will work with the band to implement the solution. Once they hit success, the outcomes buyer (the government) pays the private investors back with a rate of return. Raven Capital acts as an intermediary between all three parties.

It’s an intentionally slow, deeply collaborative process.

“We will often say ‘we are now going to be in relationship with each other,’” explained Jeff. “At the end of the day, when things get tough you rely on relationships to see you through. So we spend an inordinate amount of time building relationships and trust.”

Using business as a force for good

B Lab Canada’s Country Manager Kasha Huk joined us in July to talk about using business as a force for good, stakeholder capitalism, and the stringent requirements businesses need to meet to maintain their B Corp Certification.

We often face silos when trying to address systemic inequities: “Nonprofits and governments are creating these policies on one side to do good, and then businesses are doing the work they want to do and donating money toward causes. But they were kind of seen as separate.”

This is where the B Corp comes into play: “The B Corp movement [is] this place where businesses are seeing that [they] can address complex social and environmental issues through their business model.”

Essentially, these are for-profit organizations that want to use their influence for good.

A B Corp (not to be confused with a Benefit Corporation, which is a legal structure) embraces the idea of stakeholder capitalism. They define what’s in the best interest of a company not solely by profit, but by thinking about different stakeholders.

Currently, there are over 260 Canadian B Corps – a number that has grown exponentially in recent years.

“We work with these companies to help them achieve greater impact through the assessment process,” Kasha explained. It’s a lengthy, stringent evaluation that asks businesses to consider all their stakeholders in their operations, and must be completed once every few years to stay certified.

While the B Corp Certification is available only to for-profits, Kasha encourages all organizations to use the free online assessment as a tool to track their improvements over time across five different areas: governance, workers, communities, environment, and customers.

“[The assessment helps you] understand how you’re doing across these areas, and gives you a road map for improvement.”

Measuring success with community capital

We spoke with Buy Social Canada Managing Director David LePage in August about social procurement and the Marketplace Revolution.

In the early 2000s, David realized that while there were lots of employment social enterprises doing great work, there was a stark lack of demand for social enterprises and the people they hire.

“The companies that were saying ‘we want to help’ were [also] like ‘we don’t hire these people,’” David recalled. “But they buy the products and services that hire people into entry-level jobs. So how do we […] create the demand side that says ‘I’m going to buy from the companies that will hire these people’?”

This is the foundation of social procurement theory, which proposes that the purpose of a marketplace is not to create economic value, but to create healthy communities. This means taking into account human, social, physical, and cultural capital along with economic capital – something Buy Social Canada calls “community capital.”

“When we start to measure success in community capital, we start to change the very activity of business,” said David. “So if you aren’t paying a living wage and beyond, if you aren’t environmentally sound, then you aren’t fulfilling your capitals.”

Social procurement is about looking past financial reward as a sole measure of success, and making intentional purchasing decisions that have a positive impact across all capitals.

Government support is imperative to driving this change in how we do business, and can support social enterprise through its procurement decisions.

“The whole policy system is set up to reward big business and financial gain. We need to make accessible the same supports for social enterprises that are available to private businesses,” said David. “We have to shift how we value. It’s not the lowest price, it’s the best value. And the best value is about community capital.”

Rethinking food waste

Marcos Igreja, Genecis’ Associate Director of Engineering and Operations, joined us in October to speak about the circular economy, turning food waste into biodegradable plastic, and the environmental and human costs of the products we use every day.

Genecis takes local food waste and turns it into PHA, a biodegradable plastic whose properties are almost indistinguishable from the traditional PET plastics many manufacturers currently use. It’s an excellent example of a business contributing to a circular economy.

“The circular economy is an economy that knows how to take into account the entire life cycle of any good that is produced,” Marcos explained. “You need to be able to understand everything that came before it – all the labour, all the resources – and what happens after… how it is disposed, where it ends up. Most importantly, you have to be able to connect the two ends back together.”

The startup has already seen interest from clients across multiple industries, from medical equipment (e.g. biodegradable sutures) to household food producers (e.g. packaging). It’s hard not to get excited about their PHA: it’s sustainable, locally-sourced, and most importantly, it minimizes externalized costs.

“When people say that petroleum is cheaper than biofuel or bioplastic, they’re not taking into account costs caused by disposal, the pollution this causes in oceans, greenhouse gas emissions which affect our atmosphere, and all sorts of other political conflicts created through the improper use of those resources,” said Marcos. “In a fair economy, you have to take into account those costs.”

Democratizing control of community resources

In December, SolarShare General Manager Chris Caners sat down for a conversation about democratic control, community-financed projects, and the importance of government support for systems change.

SolarShare is a nonprofit cooperative that owns, finances, and operates 49 solar facilities across Ontario. They’ve raised over $60M with their community financing model, and their values are rooted in giving communities ownership, access, and control over local infrastructure (specifically, a renewable energy source).

“Fundamentally, the thing I’m excited about is the participation and role of community in our day-to-day lives, and in SolarShare’s case, the infrastructure,” said Chris. “The co-op model is a great model. It speaks to me about democratic control.”

It’s a lot harder for a solution’s beneficiaries to get taken advantage of when they are also its owners and key decision-makers.

“It gets a lot better when we have resilience within the community, and are able to [supplement] it with external sources,” said Chris. “For me, democratic control of infrastructure is one path to a better, more equitable future for all of us.”

Chris acknowledged the challenges of scaling community-based solutions right now. We designed a system that rewards only a small group of people. So of course the people who benefit from this system – the ones who currently hold power – aren’t eager to disrupt the status quo.

“Fundamentally, we need to change the way we operate. If we want a better and more equitable future, we need to design it into how our organizations and our laws work,” he said. “There are lots of people doing lots of excellent work, like SolarShare, TREC, and CSI. But in order to make it scale, we need our governments to help.”

What’s Next

We’ve seen some common themes run across our conversations with these leaders: the need to think holistically about how businesses operate and who they impact, the importance of strengthening communities through democratic control, and the need for government policies that support the organizations creating change.

We’re excited to continue these conversations, and we hope you’ll join us on this journey! Our first Next Economy Conversations of 2021 will be with Paul Taylor, Executive Director of FoodShare Toronto, on February 4. Get your tickets!

Further Reading

Still hungry for more? Here are a few full-length recaps from the other conversations we had last year:

Visual learners, we’ve got you too. Watch all the recordings from Next Economy Conversations and Climate Ventures Conversations on YouTube.

Creating a Platform for Indigenous Innovation: A Next Economy Conversation with Jeff Cyr

Movements across the globe are calling for systems change to build a world that is sustainable, equitable, and prosperous for all. But what will that world look like, specifically? It’s easy to get lost in the jargon or talk vaguely about broad topics. What tangible policies, models, and actions will create the world we want to see?

Next Economy Conversations, our monthly tête-à-tête with industry leaders, brings the people building systems-level solutions to the table to break down their approaches, provide key insights, and learn from their successes and failures. Building the Next Economy takes all of us. Welcome to the conversation.

This month, our CEO Tonya Surman caught up with longtime friend and accomplished innovator Jeff Cyr. His tenure in government and impressive list of leadership positions led him to found Raven Indigenous Capital Partners, where he has continued to empower Indigenous communities and innovators.

Jeff spoke on a range of topics, including barriers to innovation in government, closing gaps faced by Indigenous social enterprises, and an exciting social finance model that puts solutions back into the hands of communities.

The conversation left us all amazed and inspired. In case you missed it, you can glean some highlights from our recap below (or watch the recording above).

The government is not built for innovation

Jeff Cyr: “Governments [...] are not rewarded for innovation, and they’re not designed to be that way. Failing is part of the process in innovation, and you learn from it. But if you run down the halls of the government and go ‘hey, my initiative just failed,’ then you’re probably not going to get that promotion.”

Before Jeff founded Raven Indigenous Capital Partners, he spent about a decade working in the Canadian government. His time there gave him perspective on the opportunities — and limitations — of our existing systems.

“It was massively rewarding and massively frustrating at the same time,” he said. “As an Indigenous person working there, you kind of look at it and go: ‘well, do we really want to make change? Because if so, why are we doing these policies and these programs in this way?’”

The caveat with government-funded projects, Jeff said, is that the government is often unwilling to give up ownership. They also tend to be laser-focused on reporting and hitting measurable goals. You could almost call it tunnel vision: not only does this behaviour impede the creativity of the teams they employ, the solutions that come out of the project are inefficient, and may not even address the problem they were trying to solve in the first place.

“There are certain things the government is very good at, and certain things it […] doesn’t do well. It doesn’t do well at looking at long-term issues — the causes — as opposed to the symptoms. Often government programs are focused on the fix, not on the problem at the core of it.”

This fixation on output rather than outcomes holds back innovation: “Governments […] are not rewarded for innovation, and they’re not designed to be that way. Failing is part of the process in innovation, and you learn from it. But if you run down the halls of the government and go ‘hey, my initiative just failed,’ then you’re probably not going to get that promotion.”

What the government can do well, said Jeff, is contract administration. There are so many individuals and institutions that have lived experience of the problems they want to solve. These people also know how to innovate and get things done. By engaging and empowering them through government contracts (and giving them the autonomy to do what they know will work), the government can effectively tackle systems-level problems through innovation.

Creating an Indigenous investment vehicle

Jeff Cyr, on the Indigenous Innovation Summit: "I was trying to bring 'mainstream' social innovation on a collision course with Indigenous community problem solvers."

After working for the government, Jeff became the Executive Director of the National Association of Friendship Centres (NAFC). During his tenure, he spoke with dozens of Indigenous entrepreneurs, identifying the barriers they face to growth.

These discussions led to the inaugural Indigenous Innovation Summit, a three-day conference that gave a range of stakeholders a seat at the table. They discussed the language of social innovation, highlighted Indigenous innovation projects, and explored the opportunities in social finance.

“I was trying to bring ‘mainstream’ social innovation on a collision course with Indigenous community problem solvers,” explained Jeff.

The idea of an Indigenous intermediary came to him 4-6 months after the summit. Founders had continued to reach out to him to ask where they could access capital. And his conversations with Indigenous entrepreneurs leading up to the summit revealed massive gaps in this area.

“What didn’t exist was Indigenous investment vehicles. That’s the problem. Given those who approached us, we said: ‘We need Indigenous equity. I wonder if we can raise capital from the non-Indigenous world to invest in Indigenous enterprise and prove that this can be done.”

In 2017, Raven started with a $5M demonstration fund. They expect to close between $15-18M this September.

They just completed their sixth investment in mid-June. (It can be done, even during a pandemic!) And all of their ventures so far are promising. Animikii, a digital agency that has done groundbreaking work in Indigenous digital sovereignty, and Cheekbone, a sustainable beauty brand, are just two examples. Both have seen explosive growth.

Jeff explained Raven’s investment approach: “We are an impact-first fund. We’re not there to be extractive of value. We’re there to help business grow […] in keeping with Indigenous epistemology and in keeping with what the business owners really want to do with their business at the end of the day.”

Creating community-driven solutions

Jeff Cyr and colleagues having a discussion at the Energy Lab

Raven Capital’s Community-Driven Outcomes Contract (CDOC) is a social finance model that places control of solutions into the hands of the beneficiaries, rather than external parties that don’t fully understand the problems they’re trying to solve. The community in question will get to determine its priorities and how it’s going to get there before they look for capital.

“It has flipped the power dynamic,” said Jeff.

In 2017, a social enterprise called Aki Energy put in a proposal to the Indigenous Innovation Demonstration Fund. Their idea was rejected — not because it wasn’t viable, Jeff explained, but because the funds wouldn’t do anything for the problem they were trying to address.

Aki Energy was trying to reduce the barriers that prevent Indigenous communities from accessing clean energy, employment, and energy sovereignty. It was a policy problem, and it was a problem worth solving. So the McConnell Foundation (one of the backers of the fund) spearheaded a peer input process to see how they could help Aki Energy bring their idea to life. Jeff was invited to participate.

“An unusual cast of characters sat around the table to problem solve, and [Aki Energy] turned their back while we talked among ourselves,” he recalled. The process was unique — and empowering.

Remember, funded projects tend to be inefficient because of two things: a focus on outputs, not outcomes, and an inability on the funders’ part to relinquish control of decision-making. The investment innovation coming out of this process tackled both problems. Jeff explains:

“We thought: Why don’t we upfront the investment from private investors, and tag a rate of return based on success — a pay-for-performance model […] The Indigenous social enterprise leads and installs with the cooperation of the band. The band becomes owners of the social enterprise at the end of the day. Once they hit success, the outcomes buyer — the government — would pay [the private investors] back with a rate of return.”

And so, the CDOC was born. Raven Capital took on a role as a middleman. For each project, they have contracts with the government, the investors, and the service provider.

As Jeff’s team built out this new investment vehicle, they innovated along the way. (That’s how the idea of a rate card — one that values social outcomes as much as economic ones — was created!)

It was a genuinely collaborative process, intentionally taking more time to build a relationship with the community and ensure their needs are met.

“Everything we do is in relationship. So we will often say ‘we are now going to be in relationship with each other,’” explained Jeff. “At the end of the day, when things get tough you rely on relationships to see you through. So we spend an inordinate amount of time building relationships and trust. We go into communities, we host meetings there.”

Today, Raven Capital is working on their second CDOC project: a suite of interventions for the diabetes epidemic within Indigenous communities. As with Aki Energy, Jeff and his team hope to prove that the solution works in one community, then scale it across the country (and the world)!

In actuality, the CDOC is applicable to most community-level problems — and there has been a lot of interest internationally. But as Canada’s first Indigenous intermediary, the Raven Capital team is committed to creating change at home before going anywhere else.

“We’ll lend our expertise as we can,” said Jeff, “but we see ourselves as having direct obligation to Indigenous communities in Canada first. So we’ll concentrate here and when we have the bandwidth, we will expand.”


Reading our recap of this conversation is one thing. Hearing these words directly from Jeff is another. Remember, you can watch the full recording of our conversation here, or do some further reading at the links below.

Want to hear more from the leaders building the Next Economy? Save the date: July’s edition of Next Economy Conversations is taking place on July 22 at 12pm!

Next Economy Conversations: Jeff Cyr of Raven Indigenous Capital Partners

A headshot of Jeff Cyr of Raven Capital.

As we look to recover from the COVID-19 pandemic, we know that now, more than ever, we cannot go back to the way things were. From the climate crisis to deep social inequalities, the challenges of our time require us to build the Next Economy – one that is sustainable, equitable, and prosperous for all.

Next Economy Conversations — our monthly event series — is your chance to hear from incredible leaders helping to build this Next Economy. Learn about their work as well as their personal journeys, learnings, and visions for the future.

This week we are talking to Jeffrey Cyr, about his Indigenous approach to equity investment and fund management. He is the Chair of the Indigenous Innovation Council at the Indigenous Innovation Initiative. He is also the co-founder and Managing Partner of Raven Indigenous Capital Partners, Canada’s only Indigenous venture capital intermediary targeting innovative and scalable social enterprises.

For nearly 20 years, Jeffrey has provided strategic leadership for Indigenous, not-for-profit, and government organizations. He is Métis from Manitoba’s Red River Valley, and a proud husband and father. He has helped create and implement the a unique pay-for-success social finance model called community-driven outcomes contract, and earned an Ashoka Fellowship for his Indigenous Solutions Lab process.

Jeff’s work enables Indigenous social innovation and builds Indigenous social finance in Canada, empowering Indigenous communities and innovators.

He will be sitting down (online of course!) with our CEO Tonya Surman, to talk about how we can collaborate to build the Next Economy.

Tonya is fuelled by her belief in the power of collaboration and belonging. She knows that putting the right people in a room is only the first step in creating real change. You also need to build a culture where everyone knows that they have value and a voice to radically redesign our futures. She knows building relationships between people is the foundation for a better world. It’s also a heck of a lot of fun!

Please note that we’ll use Zoom to connect. Register now, you will be emailed the link before the event.

The Centre of the Maze: A Next Economy Conversation with Bill Young

Movements across the globe are calling for systems change to build a world that is sustainable, equitable, and prosperous for all. But what will that world look like, specifically? It’s easy to get lost in the jargon or talk vaguely about broad topics. What tangible policies, models, and actions will create the world we want to see?

Next Economy Conversations, our monthly tête-à-tête with industry leaders, brings the people building systems-level solutions to the table to break down their approaches, provide key insights, and learn from their successes and failures. Building the Next Economy takes all of us. Welcome to the conversation.

In our inaugural event, Bill Young, Founder of Social Capital Partners, joined us from his home over Zoom. A former accountant, his move from the private sector to social impact was driven by a desire to use his experience in a way where he could do good.

As over 50 Canadians tuned in on this sunny May morning, Bill spoke to our CEO, Tonya Surman, about structural inequalities, the difficulties of risk-averse governments and funders, and creating systems-level solutions. Over the last two decades, Bill has learned a lot about systems change. He tried, and succeeded, and failed, and tried again. Despite the early morning, he was animated and his passion for these challenges shone through.

His interview with Tonya was one of those events that you didn’t want to miss! But in case you did, we summarized his key lessons in this blog post.

Humble Beginnings

Quote text: Everybody was in their own sector and doing their own thing. And yet, it seemed like the best creative solutions would be at the intersection.

Back in 2001, Bill explained, we divided the world into silos: “Here’s what business does, here’s what nonprofits do, here’s what the government does — as if there was no intersection. Everybody was in their own sector and doing their own thing. And yet, it seemed like the most creative solutions would be at the intersection.”

Using that logic, he asked: “Could we find more sustainable ways to solve structural social challenges? Could we combine market forces and ‘doing good’ in a model? And why don’t we pick a particular structural social challenge and see if we can’t find more sustainable ways to do that?”

The answers were yes, yes, and let’s do it. So in 2001, the challenge Bill decided to tackle was meaningful employment for people facing employment barriers.

Today, Social Capital Partners looks a little different. But that’s not to say its past iterations were a waste of time. In fact, it was very much the opposite.

“What we learned from [our first phase] was two things,” said Bill. “One, you can make double bottom line companies work. They can work both financially — they can be both profitable and sustainable — and they can work socially — they can transform lives.”

“But the challenge is,” he continued, “what we think we are is an interesting magazine article. People like to write about it, they like to pat us on the head and tell us to keep up the good work. But at the end of the day they’re reading about us on a Saturday and going to work on Monday and doing things exactly the same way as they were doing before.”

Bill and his team realized they weren’t going to change the economic landscape unless they involved the mainstream engines of commerce. Where Phase 1 was a social enterprise, Phases 2, 3, and 4 sought to connect the economic and social impact sectors.

Making it Easy

If you’re asking someone to do something, make it as painless as possible and they’ll be more likely to do it. It’s a tried-and-true tactic. So how do you make social impact “easy” for private sector companies?

Enter the franchisees. In this phase, Social Capital Partners offered franchise owners attractive financing on the condition that they implement a community hiring program.

None of the 80 franchisees Social Capital Partners worked with ever opted out of the program. Surprise, surprise: employers will implement a social hiring program if you make it easy for them.

The problem, though, was that it wasn’t easy. Employment agencies didn’t try to understand the needs of the employers. The system is completely led by the supply (employment agencies), not demand (employers). And it never understood that we must treat the employer as important a customer as the employee.

So, for a while, Social Capital Partners was acting as a go-between, a translator of sorts. They were acting as a bandaid. But bandaids only cover up a bigger issue. They don’t actually fix it.

The Eureka Moment

Meaningful employment, universal basic income, taxing the rich: just about all the solutions to inequality are on the income side, not wealth.

And they’re all good solutions. There’s nothing wrong with them!

The challenge, though, is the first unexpected event that comes into the lives of the beneficiaries of the income solutions — like a pandemic — puts them back at square one. They have no wealth resilience.

“We said to ourselves: we’ve gotta solve the wealth side,” said Bill. “Nobody is really working on the wealth side.”

In their research, they came across Employee Stock Ownership Plans (ESOPs), a type of organizational structure. They’re meant to transition traditional businesses into 100% employee-owned businesses, and have two huge incentives: eliminating capital gains tax and income tax.

Compared to traditional for-profits, ESOPs grow faster, are more profitable, default less, and are powerful wealth-generating vehicles for employees.

Eureka! That’s a wealth resilience solution.

Now, Social Capital Partners is trying to build a case to popularize ESOPs up north. How can we get older business owners to turn their businesses into ESOPs instead of selling to private equity firms? What does a made-in-Canada solution look like?

The Centre of the Maze

The thing about systems change is: it’s risky.

“Most funders don’t like funding things that aren’t working,” said Bill. “So the tendency is ‘let’s do things that will work.’”

Social Capital Partners is lucky to have independent funding. It means they have the freedom to experiment, to push boundaries, to do things that are inherently really, really hard. “We flipped the script and said ‘no, we aren’t succeeding unless we are failing,’” Bill explained. “We will fail because we are trying stuff that nobody else is going to try. And that’s our role.”

They’re always aiming for the greatest impact they can have.

“How do we transform this economic landscape in the most powerful, equal way? How do we solve inequality? If we saw that what we were doing wasn’t going to get us there, whether it was branded a success or failure, it didn’t matter to us.

“To us, it’s kind of like a maze. In the centre of the maze is the magic of the biggest impact you could possibly have. To get to the centre, you hit a lot of dead ends. You need to hit those to get to the centre. So we never look at failure or success as either failure or success. We look upon it as part of the road map on the way to have the most impact we possibly can have. ‘Is this the route to get there?’ If it isn’t, we change. Success and failure has nothing to do with it.”


Quotes don’t do Bill justice. He’s sharp, passionate, and funny — even in the early hours of the morning. If you want the full scoop, you can watch a recording of our first ever Next Economy Conversations on YouTube. Stay tuned for our next event in June!