Dan Pallotta is the Founder and CEO of Pallotta TeamWorks, a for-profit social enterprise that has raised more money for AIDS and breast cancer charities than any private enterprise in history. In seven years, the AIDSRidesUSA have channeled over $83 million directly to AIDS charities, and the Avon Breast Cancer 3-Day Walks have put over $65 million into the hands of breast cancer charities.
Over 100,000 people have participated in a Pallotta TeamWorks event. Over 1 billion people have been reached in the media coverage of Pallotta TeamWorks events, and over 3 million people have become new donors to the issues Pallotta TeamWorks events support.
Last week, Pallotta spoke with The Harbus about his dreams, ideas, and his work. He will be on campus to speak to the HBS community this Wednesday, 12:00-1:00 PM in McCulloch Lounge.
HARBUS: When and why did you decide to start Pallotta Teamworks?
PALLOTTA: In its existing incarnation, Pallotta Teamworks really began in 1993 in response to losing several close friends to AIDS. While I was at Harvard, I had participated in an Oxfam ride across America with forty other riders against hunger. Oxfam had started after World War II in Britain and spread internationally, and I was looking for something, demanding, and challenging, a powerful metaphor that would organize people around the scourge of AIDS.
So the AIDS rides grew out of that experience, as a way of tying the metaphor of traveling-the great adventure-to a movement to raise funds against the epidemic. I didn’t think a black tie charity dinner was enough of an outlet to make the kind of change I wanted to effect.
Right now, we have 300 full-time employees. We organize 16 events, and with those events, we expect to net around $100 million dollars for charity this year. That’s more the type of magnitude I had in mind.
HARBUS: One of the aspects of Pallotta Teamworks that has drawn particular scrutiny is its status as a for-profit venture. Why did you choose not to become non-profit? What does for-profit status enable that a non-profit would not?
PALLOTTA: The for-profit model seemed to me better suited to an entrepreneurial venture, which is what Pallotta Teamworks is. It’s allowed us to make decisions on our own, take risks on our own, and take responsibility for those risks and their successes and failures. That’s something you can’t really do with a non-profit organization.
I’m impulsive. I like to experiment. That’s what I can do with Pallotta Teamworks as a for-profit that I couldn’t do if I had to answer a board of directors. I should say, though, that it was never about the money, nor was it ever not about the money. That is, I am not against money or making money, but I also didn’t see Pallotta Teamworks as my way to get rich.
We have for-profit models that put shoes on the feet of people across the world, and put computers on the desks of nearly every American household. We should recognize that we need powerful, multi-billion dollar companies to take up the important social issues and channel those resources.
I also think that the for-profit model is about discovering great successes by trial and error. In business schools people are encouraged to take risks, but we expect non-profits not to. I was reading recently that Amazon.com only recently showed a profit margin of five million dollars. But can you imagine a non-profit organization that operated for several years at a huge loss of revenue? We burden non-profits with the expectation of 100% yield, and as a result, they are extremely risk-aversive.
HARBUS: How does Pallotta Teamworks decide what social issues to undertake? On two different occasions, I’ve heard you mention John F. Kennedy’s speech about going to the moon as an analogue of the type of thinking you want your organization to inspire. How does this “thinking big, even impossible” manifest itself in what you choose to do?
PALLOTTA: Mostly events have emerged out of some personal passion-AIDS rides because I was losing friends- the Out of Darkness project about suicide because of my partner. I also think AIDS is a huge, global issue, perhaps the biggest issue of our time. But I felt these were moments in time, where something needed to be done and where I felt powerfully moved because of people in my life and its relation to big issues in the world around me.
I think the JFK speech I quote is about inspiration to do bold and daring things. I wrote a paper six years ago about the end of AIDS in five years. It’s about commitment and context as the truly decisive forces in great dreams, not just the technology or the science. What I think is really the key is the technology and science of commitment and concern, figuring out how to generate those and harness them to make change in major social issues.
HARBUS: This tie between deep-seated personal meaning and big action makes me wonder whether you imagine a political component to the work that you do. From my own experience on the AIDS rides, it seems to me that so much of the individual event is about kindness. Should this also translate into advocacy or political action in a more concerted way?
PALLOTTA: Absolutely. I would love to see participants in our events involved in lobbying the government for more money for AIDS research. If we could get those five hundred die-hards from the Alaska AIDS Vaccine Ride to do advocacy, there’s no telling what sorts of changes we could make. As an organization, we haven’t devised a skill set to do this.
In terms of kindness, you can’t legislate it, of course. But political leaders have a certain power. Perhaps it would be possible to establish a day in honor of it, when we encourage people to experiment with kindness. I find that the government is very unimaginative and that we could be doing powerful things.
If I were president, I would have in my cabinet a secretary of creative development, a secretary of marketing, and a secretary of graphic design. I’d also change the color of the dollar bill and of highway signs. I think there are lots of ways the government could be more innovative in what it does with communities.
HARBUS: Where do you see Pallotta Teamworks headed in the next two years? In the next ten years?
PALLOTTA: We plan to expand out breast cancer and suicide projects and to narrow the Vaccine events to the point where we can get an effective rate of return on the donors’ investment. We also are trying to leverage some of our existing business structure to help other charities in the off season.
I’ve thought about making an ad agency dedicated to possibility, that would take on innovative products or inspiring candidates for political office.
I don’t know what the ten year goal is, but I kind of think of us as a “Disney of meaning.” Disney made the animation theme park part of the American landscape. I would like to see us installing in our culture kindness and bold thinking in the face of social crises. That’s our direction.
Kevin Lamb is a Ph.D. student in English Literature at Cornell University. He has also participated in two of the AIDS Rides organized by Pallotta Teamworks.