Aaron Mashano On Key Qualities Of Social Entrepreneurs That Create Lasting Impact

With over a decade of experience in the Vocational Education Training (VET) sector, Aaron Mashano founded the now international business venture, Leaders of Tomorrow [LOT] Group.

Aaron was born in Zambia and is based in Australia, Bali and Singapore.

Aaron has consulted with organisations like Fairfax Media, OPSM, NAB, The Red Cross, Mission Australia and Jesuit Social Services. More recently he partnered up with Top Tier Coworking Spaces like Hubud and Impact Hub, coaching numerous Upstarts at Google Startup Incubator Events and has been invited to keynote at top corporate and governmental events. Aaron currently dedicates his time to making an impact across his social enterprises, books, audios, workshops, consulting and angel investing.

Aaron shares key insights into starting & running successful social enterprises, whilst giving strong pointers on the differences between not-for-profit and for-profit models. Aaron also shares what he believes are the most important attributes of successful entrepreneurs.

Highlights from the interview (listen to the podcast for full details)

[Nikoline Arns] - Aaron could you please share a bit about your background and the path you took to get to where you are today?

[Aaron Mashano] - I think it's a big question on a long journey. So to give a summarised version, I'm Zambian born and I think have been very privileged to grow up on a farm with some very influential parents in the sense that they taught us work ethic and also taught us this need for self sufficiency because you farm work never gets completed. So there's always work to be done and you know, rather than telling us what to do all the time, they have always encouraged us to look for things to fix.

So I think the short answer for why, or, how I became who I am is I think I've always been a very curious person. I can go on fixing the world and I know you can't really fix anything and you can't fix people, (I tried, it doesn't work), but I feel we can make a positive contribution by entrepreneurship or at least social entrepreneurship. In the sense that you can look for some wrong in the world that maybe you can make right by creating a business venture that can solve that particular problem or service, or idea, you know?

So I think that journey was always in the back of my mind because I know I'll get fulfilment from that. But like most people, it took us a long time to discover that I was good at that because I think we are told to go to school, get good jobs and become a good lawyer, which is my background. But I found I wasn't passionate about that. So I kept on the search until I fell into business. But the truth is I probably failed at everything else. And then business stuck really well and it's applied a lot of my parental mindset and what's allowed me to really express myself. So that's how I got into business and I think it's been five years of being fully committed to it and I'm 36 now. As most of us have tried to dabble in business projects, I went full time, a hundred percent committed, no part time job five years ago. I've been really fortunate that I've had the success we've had and that's in a nutshell how we got here.

What is it that drives you to start new projects? [4:40]

I think I've just never been satisfied in general. And that's been a bit of a challenge for me. I always felt even as a kid I did things like athletics and I remember one day, (I'm slightly competitive), it wasn't more about trying to beat someone else, but just trying to see how much I could be better and I found running against people who are better they are pushing you to get a better time. So it's quite measurable in my youth about that I find in the business space when I meet other business people, then I see them doing it on such a big scale. It forces me to look at ways I can grow my capacity to role model them. So that makes sense. The best example is my probably my juice company. I launched the cold press juice company and it was going well, and then I met some people who said, 'but you have to make margins and it's organic. So we understand that you are using plastic, but plastic's no good for Indonesia, so why don't you do glass?' And I thought, 'it's too expensive' but I found that this other company is doing it. So the minute someone else's doing good better, I feel like maybe I should take on that challenge and that might have it's risks. So by doing that I found that it actually made the business perform better because it was just a good business and it allowed me to look for alternative ways of still making sure the business doesn't go under without compromising some values. So I think what motivates me now is just asking myself the same big question, 'how can I be better as a person by pursuing a project that maybe makes a greater difference in the world?' And, and I don't mean that in a characteristic way, like this will save the environment. More in a way that I've already got a project to be sustainable, so can I increase the responsibility around it because it's already viable. And so it limits how many projects I can do.

But I really get passionate now about doing projects connected to say the United Nations objectives that are translatable by the projects I'm involved in. And that gives me focus. I wouldn't jump into any projects around something I can do that's not connected to the skill sets that I have and I think that's something most people should consider before they just go out there and start projects. That would never work long-term.

So yeah, that's why I do it. And I am really addicted to see other people happier. So it's very, very hard to turn back now.

What do you believe are the most important attributes of a social entrepreneur? [7:34]

I think someone connected it really well for me once: Social is such a big word, it can mean so many things.

For me the attribute of a social entrepreneur is just someone that puts a key performance indicator as being community and contributions.

I think that's probably the best simple distinction I can have. And most people say, 'well, we have a triple bottom line' which has some sort of environmental community, so community development use of profits, but they're doing it for tax breaks or they're doing it for branding strategy. I don't know if that qualifies.

Good entrepreneurs are just community builders, they're really actively involved in making sure their business creates a community.

Then the community gets dedicated back to the business. You know, it's kind of that way inclined. So that to me defines social entrepreneurship models; when you talk to most of us, we obviously want to be sustainable, but we're also very much asking the question, what's the impact on the community? Where we have set up a farm in Indonesia, I want to make sure I'm not killing the environment because it's not my land. I just own the business and at the same time I want to know am I providing, not just jobs, but that I may help communities become better even with the impact that I've made. We are really community builders because everyone is involved all the way through, and then some of that money has to go back to solving a local community problem that was already there before we started.

I think social entrepreneurs are always community builders. When there's not that component and you're just giving money to the problem, I wouldn't necessarily classify that as social entrepreneurship.

How did you find your purpose and how did that change the way you live and work? [10:05]

Oh my goodness, Do we have time? I don't know if I found my purpose. I think more my purpose found me, in the sense that I think I just had a really defining moment in my life and I think that made a lot of people now that entrepreneurs who some of them were born with a vision to change the world and off they went. For me, I wasn't very confident as a person, so I was never really lucky like that. That was more of trying to avoid making mistakes, trying to really just try and do the right thing by everybody, but in the process of doing the wrong thing by myself.

Then one day I ended up losing everything. I ended up just losing my son, which was the biggest turning point for me. And then I almost had a near death experience where for me, I'm probably more motivated by other people than I am by myself. So I came to this near death experience in the dip of my life and I had lost everything; I was homeless. I didn't really live my life, I lived my life by what what other people told me to do at that time. It didn't work. So that hindered my marriage, et cetera. But I really loved my son enough to show him to be a good role model and the answer at that time was no. And the last one that really wanted to achieve was a legacy that he looks back on and can be proud of. It's not just based on the fact of what I got out of life but what I left behind.

So my son was a really big turning point and gave me the purpose I need; a cause to really live outside myself and really try and make a difference in the lives of others that would be like dominos: one small project after another until I created a dumb name like Leaders of Tomorrow that is actually about my son and myself.

You’ve founded several social enterprises, can you name any common challenges you faced along the way? [12:35]

One of the things I would love people to take away is something that I learned from my mentor and that is managing your own emotional expectations. What I mean by that is, you know, most of us entrepreneurs in general are high achievers or think we are high achievers and we want to do good by ourselves and we want to be respected. But when you try a project, generally nine out of 10 times you fail because your skill level is low, or your experience is low or your information is low. There is a very high chance that it's not going to work. Because society and school expects us to be perfect and get good grades. That expectation can create a very big disappointment in people. So I think in terms of the biggest challenges I had with projects that didn't make it on my list of LinkedIn successes, is that I didn't try enough times to do things in the beginning while I was gaining my mastery experiences. I needed to know how to structure a project. I was spending more time feeling bad about why it didn't work the first time. So I was losing money, losing relationships. And then I'd go away, reflecting and feeling guilty, going to talk to my friends who also show me why I shouldn't have done it and they told me I shouldn't have done it. So you're just keeping that cycle. But what that does is just lose a lot of time.

The best thing to do is do a SWOT analysis, and execute as best as you can. Keep doing whatever you've got that's working and throw away the part that doesn't. And then you rewatch and you pivot.

So that skill for me was the biggest one to learn. Because I have to actually learn to manage my emotional disappointment.

Don't confuse temporary defeats with failure, because every single person in business has had temporary defeats, but it's temporary.

And failure is something you decided is permanent, so we can never move from that. So should never move into failure too quickly and just kind of shoot every obstacle. That's the number one biggest challenge. The second one is that I think self esteem is a big thing. I was not taking enough of my own time in terms of my journey.

Watch the Steve Jobs movie. In one and a half hours he has made it to being a billionaire, but that one and a half hours represents 40 years of his life, and so we lose a time perspective and how long successful projects take. So the thing that I really found difficult was being patient with myself and being able to grow on the inside, which is very subtle but powerful.

I'd spend time talking to experts and then talk to my friends. Everyone gave me different strategies and I'd just be confused. So that project would fail out of confusion. I was changing the strategy every time someone gave me feedback. So yes, feedback is important, but I think at the end of the day you're going to finally make a decision and then you find people that support your decision versus constantly changing. Y

I think the last one was just: thinking I needed money. We all think we need resources to solve a particular problem because you need to buy things to produce, and that could be true sometimes, but the reality is you could probably connect with the right person that has some of those resources and could easily create an exchange with you to get the same solutions.

We spend more time trying to find the money instead of developing the relationships that can help us feed successful projects.

Does that make sense? To spend too much trying to do it all on my own rather than trying to build a support network of skilled people who could maybe have done it for free. My operational costs would not have been so expensive as they were and I'd run out of money anyway.

So I found that money's not the issue; it was a lack of networks that was the issue. So I spent my later years building networks and I found my projects are way more successful over time.

How might organisations best create a positive work environment of collaboration, where everyone contributes their best? [17:24]

That's a big question. I mean I am a business person so I have this boring life of being obsessed with organisational flow. So I just want to make sure I don't spend 10 years explaining it, but you know, I'm a little bit controversial on some of these topics because I only speak from my limited experience of what's worked for me.

Let's start with values, because values is my passion topic. I build a lot of businesses with people not aligned with my values, and out of the interest of autocracy; flatline structures, cheap organisations where everybody gets to contribute and provide input. I think these are very, very powerful because I think everyone deserves a voice.

I think everyone deserves a voice and I feel there should be equal opportunities for people to feel there is open communication within an organisation.

In some organisations you don't have that culture because information flows across divisions up and down or even if there is a division, even if there isn't a division. However, I think there's a big difference between that and having an agenda to have the right person in the right seat, so that the value there is performance.

I think what's missing in some social enterprises is they don't have enough of a performance objective, so they designed their organisations around social value.

The objective for me of any enterprise is to go and solve a community issue or community problem and have an objective. So the main goal of the organisation is to ask the question, 'who are the right people who are capable to solve that issue and willing to solve that issue and what is the right position for that person to be able to feel empowered in that position to do it.'

How might organisations best create a positive work environment of collaboration, where everyone contributes their best? [17:24 continued]

So when I'm evaluating people in a social enterprise, I need to see if they are ticking all three boxes because I value those things because the end objective is to produce the results for a solution for the community, otherwise the problem never gets solved.

When I coach my executive clients that have teams of people, we use the analogy of a bus instead of a pancake. The bus has to go from A to B and there are specific seats, but there's always a driver and I think the driver is the founder of the organisation and he's the one that has to be responsible for two things; integrating the values and also creating values. If he doesn't create and let's the mob create the values, the only thing the mobs do is to destroy things, even with the best of intentions.

The founder has to have the clear values in place and then recruits the tribe or the team or the community that share those values.

So I feel that it still needs a leadership role for a leader to decide on the top three values at least. Then you create a community.

So I challenged a lot of founders with this and I find every time they marry the bus and divorce the pancake analogy, they seem to achieve their objectives and stay more sustainable cohesively as a team.

So that brings me to structure now, with the ones who do the first part of knowing what your values are, the founders then look at which organisational structures fit with these values, because like a human body, the human body functions upright at optimum. It has a brain, two legs, one heart, et cetera, so it's the same as the bus and is created in the same way. The value here is a human being, all human beings do this. But if you are a dog. Then you've got four legs on the floor, a tail that's does whatever, and you'd probably bark and don't speak a lot, so communication is not that important. So look for a company that has similar values and similar objectives and then mirror the structure that they use based on the values that you already have.

I feel I'm more flexible with the structure but I'm very rigid with values because I think those are the things that you are born with. No one needs to teach me how to be kind. I was born in an environment that values kindness. So I tend to expect that from my team, my key partners, my organisational flow is kind to freedom. When I was in Spain with you my business was still running somewhere else across the world because that is the value that comes with being kind to people and their time and their independence, right? So I hope that makes sense, the structure. But when I teach it, I use the human body because I feel the most efficient way, most organisms work is they have one brain, one heart and a couple of functionalities. This was very efficient because we spend the money and resources accordingly. So yeah, that's kind of how I coach it.

When it comes to successfully getting finance as a social entrepreneur, what are the top 3 recommendations you’d make to help organisations on their journey? [23:48]

In my opinion true social entrepreneurs appreciate that the only way to create long lasting sustainable change is by being financially sustainable. Because if you're not financially sustainable. You can't continue to operate as an entity in the business sense.

Even though we have a social objective, it doesn't become the excuse to not become financially resourceful.

Probably half your audience will hate me for this, but I'm a social entrepreneur, but I'm a for profit social entrepreneur and I'm not a non for profit social enterprise. Because non-for-profits are already setting up the culture they don't want to make any profits... but allow me to define what profit means. I'm a profitable person. If I was insecure and then I become more confident, that would be a gain in the positive sense beyond my normal expectation, so it's profitable to be more confident for business or life.

I'm more profitable if I'm healthier and maybe you have to buy organic food, but if I have to do that, I probably still need to give some money to somebody and not just a hug... so I have to be more profitable. Again, in that context. In the legal sense, business has a sustainability concern, which is the legal primary function of it and so if you're always at a loss financially, you are killing your organisation. It's almost like taking a cell and choking the oxygen out of it.

My encouragement to a lot of social entrepreneurs is to start to have a healthy relationship with money.

Money is one of the main resources needed to service the business so that you can continue to do good in the world. So this is why I always encourage people to move away from non for profit which is expecting the government or some other entity to give you money and then you start falling into an administratively heavy business and then stop delivering the outcomes, which is why you started in the first place.

Whereas when you are profitable and you look out for profit opportunities, we can still leverage short term government grants or scholarships. I don't care, but we start looking at how can you commercialise yourself so that you can continue to do good beyond yourself as entrepreneur. I think a true business needs to perform posture death because then you know if you did good for the world. And the best example I can give is of World Vision. Not saying anything good or bad about them, but in my community, I am the product of an experience. So when they have money to send to us, we have the support. But the minute they run out of money or can't get government funding the help becomes detrimental. So we are now worse off because we had tasted the chocolate sweets and tasted the nice clothes, tasted all these fancy things and then we have to go back to the old. And that ridge is very hard and people can get psychologically traumatised.

So I think as social entrepreneurs, we need to remember these examples and see how World Vision could be more sustainable financially, so that they can keep doing good and scale out to the rest of the world versus getting a million dollar payout from the government. The next time Donald Trump gets in power and doesn't support it, you have to call back those resources. So I just don't encourage non-for-profit for that reason. My point is I actually value money. Whereas when I was a good doer, I never made it and I struggled and then projects failed.

I hope that gives you the courage to get a little bit socially capitalistic in the looseness of that word without losing your soul because it's not about that.

It's about protecting the integrity of your projects without needing government's intervention or government's agendas which spoil what we start. That's happened all over the news. We've all seen the model doesn't work, non-for-profit's aren't working, so I'm just trying to challenge everybody to step it up a bit. Look for alternatives, bitcoin or I don't care, but that's just one obvious place I think you should clarify. Does that makes sense?

Being a father can you see some challenges that our future generations will face, and what are the key skills you believe are crucial for our students in preparing them for the future? [29:06]

So I've done a bit of growing up since I last spoke to you because I started questioning my intentions and my content. I can preach motivation, I can preach inspiration. I can preach following your passion. But the truth is, technology is moving really fast which is good. Science medicine, discoveries in the spiritual realm, environmental. We have a lot of technology that can solve a lot of the problems we have. So I don't think technological information development is the issue here.

I think the issue is the lack of real implementable education.

Rather than teaching my son the next mobile phone app or platform that we can use to pick up rubbish in the neighbourhood. I would rather make sure he understands the impact of rubbish and then look for the practical response in appropriate time.

Because if we don't make that connection again, we'll be offering money solutions or application solutions. We'll spend a lot of money doing this for future generations and yet they are disconnected from it. So we need to connect them first to the problem. And I know this personally, I've been trying to help my African family for so long, but they see TV, they see McDonalds, Mercedes Benz, iPhones. They want those things. I can't tell them you don't need those. In fact you need less technology. We in the west have experienced it, so we can suggest it and say go technological free. For them, it's a sign of wealth and intelligence if they have two mobile phones, but they don't understand it costs you 20, 30, 40 euros every month just to maintain those things and they don't have that sustainability.

We need better role models, to bridge the gap between technology and the reality of the world. So I think that as parents we just need to practice what's conscientious about our consumptions. Show our kids so they can connect with why we throw things in the bin on why we don't. That's number one.

Technology is moving so fast, but it doesn't mean that we're going to change mindsets. We have to start helping people think through what can they do individually that actually creates impact and then to measure that.

If you can't measure it, a life of effort may not be enough, because people are aware they need to lose weight by not eating Mcdonalds, but it doesn't stop them going to Mcdonalds.

And I think the future generation are missing the connection. They're very disengaged. So I think us as parents can take us offline a little bit more and really bring them back to what's needed, and then reintroduce platforms that connect us again. And in that way maybe connect with it. So that's what I would recommend. But that's me, and I'm a single father, so take it with a grain of salt. What do I know? But that's what I intend to do with my son, but that might not be applicable to all parents. I just have to be careful and put a disclaimer out there.

You’ve founded enterprises in Africa, Australia and Indonesia and Singapore which all have their own policies/challenges and solutions. Are there any countries in particular you believe are really leading the charge when it comes to social innovation? What are they doing that you think other governments around the world could adopt? [32:55]

I really found it harder to do good in some developed countries because they were very much focussed on safety over innovation, because time tested methods are safe.

That's true, but the challenge with some of that is what's that saying about nature?

The things that tend to be the strongest in nature are not the strongest or most developed ones, they're the most adaptable ones.

What I find in developing countries is that governments are more involved because maybe they don't have enough money. They don't have a lot of social security, they really encourage people to start side projects alongside their full-time vocation. Because there is no warranties. They have looser laws to encourage people to try to solve their own local projects.

There is a big ageing population, baby boomers, super generations that don't work anymore and not because they can't, it's just the ageing population is living too long and utilising all the resources that would have otherwise gone into current projects. Right? So the government as an entity can no longer be responsible for the basic fundamentals that solve community problems. We as individuals need to start becoming more entrepreneurial to be able to create innovations at a local level, and that's really what I think is the beauty of social entrepreneurship. But to do this, we need the government to be aware and become adaptable, to loosen the laws because the real problem is they know they can't sustain the problem and solve it anymore. It's just too big now. And this is where privatisation is coming in and unfortunately the private sector is taking over the world, because the private sector entrepreneurs are solving that demand. which is creating a lot of wealth for them, but not all the demand is motivated by community objectives. It's motivated by opportunities.

Look at Bali, this is why Bali is amazing.

They have a system called the Banjar. The Banjar is like a local community council, but address their own problems. They have a local police and they're just their own little entity so it's quite dynamic in one area. Completely different in another, but they look after the trash. They look after the medical, they look after all that. And it's a little bit more autonomous and self managed. Now it has its problems, but the reality is, there's not a lot of money in this country in the bottom end of town, but people don't have complaints, because they know where to go to solve those problems in a local area. They don't have to wait for a vote or stuff like that. That I think that's something that the west can learn from them, not because they can, but because they have to. Whatever they're doing now, they're underutilised, so this is an alternative way to stop lying to the public by saying, we just need you to work till you are 900 years old. The reality is, they've run out of money. They're not sustainable and rather than telling people to work too much, why not empower them to look after themselves and look after the elderly, look after their medicals and they might have unique needs that the government at the national level can't support. Do you know what I mean? That's what I see as a social entrepreneur is giving the power back to the local communities.

To wind up, are there any great social impact books or resources that you could recommend to our listeners? [37:15]

[Aaron recommends the books listed below and provides some strong reasons why we should read them!]