Making all-natural sodas and running a socially responsible mutual fund company may seem worlds apart, but for entrepreneur Sophia Collier, the jump from one business to the other was a natural progression.
"They're both liquid," she said with a laugh.
But they're similar in another way as well. Collier, 39, has made a fortune building businesses that reflect her values, ones that she can parlay into tangible, profitable products that other people with similar values want to buy.
"Most people think that in business, you have to be bad to succeed, that good guys finish last, that you can't invest with your heart, and yet from my own business career, I've learned those ideas are actually faulty and harmful," Collier said in an interview.
"Businesses that have the elements of being socially responsible, those are the ones that do well."
In the first case, Collier started Soho Natural Soda when she was 21 and built it up into a major soda company, the first of its type. She sold out in 1989, making $15 million by the time she was 33.
"I was taking a product that was widely perceived to be bad for you, unnatural beverages, and making all-natural soda," she said. "Many thought it was a contradiction in terms," she said, but it was those people who turned out to be her customers.
Then she took the fortune she accumulated with the sale of the business and, after digging around for a couple of years, bought a socially responsible fund group, Working Assets, and renamed it Citizens Trust. She owns 60% of the company and serves as president.
Her goal is to build the company, now with $300 million in assets, into one with $10 billion, and she thinks she has a fair shot at achieving the goal.
"It's less competitive than the soda business," she said, noting that Coca-Cola Co. and Pepsico Inc. both had a larger share of the soft drink industry when she started than Fidelity Investments has in mutual funds.
For those who think a strong sense of values and ethics conflicts with a desire to make money, Collier is a case study that undermines that argument.
"One of the things that informed my decision to go into the mutual fund business is the idea that your checkbook expresses so much about who you are," she said. "I feel the same way about my investments."
She wanted to invest in companies she liked--the sort that don't pollute and that promote minority advancement, community involvement, employee training and affordable housing, among other goals.
Socially responsible investment funds answered that call. But Collier also stressed that the investments need to offer decent returns if they want to attract new investors.
One fund her Portsmouth, N.H., company has started is called the Citizens Index, made up of 300 of the "country's top socially responsible companies," which includes familiar names such as Coca-Cola, Microsoft Corp. and Bell Atlantic Corp.
"My vision and concept is that large companies can have the greatest positive impact," she said. "Ben and Jerry's is a great socially responsible company, but it only has a market value of $100 million and doesn't have a wide impact."
Citizens Trust provides a list of the 300 companies in the fund and also offers profiles. The list can be found on its page on the Internet's World Wide Web at http://www.efund.com.
Coca-Cola, it said, has fostered the growth of minority-owned businesses and has been named one of the best places to work for African Americans.
It also noted the company scrapped plans for a plant in Belize after when environmental concerns were raised. Instead it set aside a portion of land for conservation and sold the rest.
With stiff investment criteria, one might think the fund under-performs. But that hasn't been the case. Through Oct. 27, the fund was up 35.24% so far this year, beating the S&P 500 by 6.37 percentage points in the same period. It also has ranked at the top of all money market funds, with a current annual yield of 6.32%.
Citizens Trust also has gotten a lot of publicity out of its E-fund, a money market fund that works like a checking account and requires a monthly electronic deposit.
It invests in socially responsible cash investments, from Small Business Administration loans to commercial paper. But it doesn't buy Treasuries because it says the money can be spent on anything, including weapons.