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September 13, 2019

Can free enterprise function with a safety net? $1,000 says yes

PHOTO | 20th Century Fox ’Greed is good,’ said Wall Street’s Gordon Gekko. Says MainVest: Not so fast.
By Michael C. Bingham

A Massachusetts-based “social investment platform” has announced a region-wide pitch competition for entrepreneurs seeking to start local businesses throughout New England.

Instead of a cash prize or equity investment, however, the winner will receive a $1,000 monthly stipend for a year — a concept similar to “Universal Basic Income” (UBI) proposals advanced by some Democratic Presidential aspirants such as Andrew Yang. Yang’s “Freedom Dividend” would provide $1,000 a month to all U.S. citizens over age 18.

The pitch competition is sponsored by MainVest, a Salem, Mass. crowdfunding portal with a mission to empower communities and entrepreneurs by allowing everyday Americans to invest in local businesses and share in their success.

MainVest’s “Main Street Dividend Experiment” will provide $1,000 a month to a New England-based entrepreneur whose enterprise is deemed most worthy based on criteria including viability of business model, community impact and audience voting.

“At MainVest, we believe that small businesses are the backbone of the American economy,” said MainVest CEO Nicholas Mathews. “With the rise in discourse surrounding UBI right now, we find the concept of providing financial breathing room for entrepreneurs looking to start a business compelling. We want to add to that conversation by seeing how UBI would impact a local entrepreneur here in New England.” 

Universal Basic Income is a form of income assistance or social security typically intended to reach a large portion of the population with minimal conditions. 

But isn’t the drive to succeed motivated by the desire to achieve economic success — including the accumulation of wealth? For many, that’s the core principle of the American Dream. Isn’t diminishing the economic drive by definition diluting that dream?

MainVest doesn’t see it that way.

"MainVest is running this campaign as an experiment to better gauge the effects of a safety net income on local entrepreneurship,” Mathews explained. “I believe that UBI could be a massive driver for market capitalism, by creating an environment where starting local businesses becomes effectively de-risked through a basic income, enabling more entrepreneurial risk-taking, company creation, and local buying power."

The pitch competition is open to New England residents over the age of 18 who are looking to start their business in a local community. Full details on selection criteria and eligibility can be found online at mainvest.com/dividend-terms-and-conditions. 

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