As the world becomes more aware of and active in coming together to solve shared problems, as individuals reassess their priorities and search for meaning, and as people challenge the roles and limits of governments, business and economic models are also evolving. This emphasis away from institutional power to personal power and collective influence has been driven by a palpable increase in consciousness. The economic shift we are observing in real time is moving from and through authoritarian capitalism, to shareholder capitalism, to conscious capitalism, to Karmic Capitalism.
The great resignation, personal privacy, global warming, race and gender inequality, and the desire to pursue a more abundant life are signals that many assumptions of capitalism must evolve. In capitalism the free market determines which product, service or idea wins, based on price and a value equation. As society evolves, the idea of the free market and capitalism must also evolve to remain relevant and to reflect new societal norms. As we move into a continuously compounding metaverse, to be relevant, businesses must embrace a new model of capitalism that is purposeful, sustainable, equitable, flexible and personally relevant.
Characteristics that differentiate Karmic Capitalism from the previous versions of capitalism are:
Capitalism 1.0 – Authoritarian/Stakeholder
- Zero sum mindset
- Profit-driven mission
- Autocratic labor-based operations
- Solutions are profit-focused
- Sustainability is secondary
- Top-down management structure
- Monopoly focused
- Small groups receive the majority of wealth
Capitalism 2.0 – Shareholder
- Competitive mindset
- Government regulated
- Company-driven mission
- Bureaucratic process-based operations
- Solutions are earnings-focused
- Sustainability is mixed
- Open and closed sourced
- Board management structure
- Market share focused
- Shareholders receive the majority of wealth
Capitalism 2.5 – Conscious
- Contextual mindset
- Stakeholder influenced
- Purpose-driven mission
- Entrepreneurial data-based operations
- Solutions are quality focused
- Sustainability is primary
- Distributed management structure
- Market sector-focused
- Distributes wealth throughout the organization
Capitalism 3.0 – Karmic
- Shared abundance mindset
- Stakeholder regulated
- Values-driven mission
- Decentralized data-based operations
- Solutions are outcome focused
- Sustainability is mandatory
- Open-sourced and shared
- Collective management structure
- Market ecosystem-focused
- Distributes wealth throughout the organization and the market ecosystem
Karmic Capitalism is a sustainable economic model that empowers individuals with diverse backgrounds, preferences, and objectives to solve large and small challenges. In Karmic Capitalism, the principles of innovation, productivity and value within a free market still apply. Products and services are based on values and advancing the entire market ecosystem with all stakeholders involved. There is no division between buyer and seller, winner and loser, owner and employee.
Karmic Capitalism is a free-market tenet, with the government playing as a value-added support structure. Block-chain technology – smart contracts and decentralized finance – will provide the legal and financial structures that will reduce the requirements for central government expansion and provide guardrails to ensure everyone “plays fair.”
Not “everyone gets a trophy” in Karmic Capitalism. It is a balanced platform for personal and economic growth. A key benefit is that everyone who engages and contributes with time, money or wisdom shares in the influence and wealth that the market creates. And quality, effort and an abundance-based mindset determine the size of the trophy.
Karmic Capitalism fully embraces the idea of a higher order consciousness. It supports that thriving in a more conscious economy requires a deeper understanding of the laws that relate to the attraction of abundance and happiness, and the repulsion of scarcity and depression.
With Karmic Capitalism the entire market community matters. All participants are investors (time, money, expertise). As the market grows, the community proportionately gains wealth and opportunity based on impact and contribution. How this is accomplished may vary greatly as consciousness-minded businesses look to incentivize active participation beyond traditional discounting and promotions.
In Karmic Capitalism, a market is not “people to sell to, who may buy the product.” The word market is now a supportive community of people and organizations coming together to solve a pain based on shared belief systems, and/or celebrate shared values through commerce. Markets aren’t thought of as product categories. Entrepreneurs don’t measure the impact of market leadership by percentages of sector sales or growth over time. Markets become people who influence each other, connect with each other, and share common standards for behavior.
Technologies such as blockchain and cryptocurrency offer a decentralized infrastructure that allows the market community to systemically benefit from growth. As an example, an organization inventing a new market may decide to create a Decentralized Autonomous Organization (DAO) built on blockchain technology that serves as a central board of governance for a market ecosystem.
There have been tremendous efforts in a “do the right thing” approach to business through Conscious Capitalism and other corporate responsibility initiatives. And although these are indicators of progress, there will not be a major leap forward in business and society without the awareness, understanding and integration of consciousness itself.
Consciousness is not a religion. And anyone who researches the data around consciousness will uncover the shame and fear-based rules inherent in many religions. As data via psychology, quantum physics, neurology and epigenetics compound, we are seeing a validation and convergence of science and spirituality around three universal truths: 1. We are infinite beings. 2. Thoughts create our reality. 3. And love is the most powerful thought.
Companies who are evolving towards Karmic Capitalism are demonstrating a glimpse of its true potential to make the world a better place. Consider the North Face and Patagonia – companies that each began as manufacturers of climbing equipment and evolved to apparel. Their founder stories and the current staples of their lines are nearly identical.
The differences between the two companies are in purpose, marketing, overall consciousness and, as a result, revenue per employee.
Patagonia, for instance, has long approached its market as a consciousness belief system rather than a series of product categories.
Patagonia is an icon for a movement, with customers who come aligning psychographically. The North Face sells product lines demographically.
Patagonia’s mission and brand foundation: “We’re in business to save our home planet.” The North Face’s mission and brand foundation: “We’re in business to help people explore our planet.”
The North Face was sold twice from its original owner, and is currently owned by VF Corporation, owner of multiple “lifestyle” brands including Timberland, Vans, Dickies and Supreme. The VF Company talks about values and stakeholders, operates a foundation that gives $500,000 per year to organizations that support exploration. It has had a Black Friday promotion that extends to Giving Tuesday that gives $1 per item, if purchased at full price in the United States, to the foundation. The results of the promotion were not disclosed in case studies or corporate press releases.
The results of Patagonia’s 2021 Black Friday “Fundraiser for the Earth” promotion: $10 million in global gross sales donated directly to grassroots nonprofits that protect air, water, and soil.
They are two strong companies with similar product offerings, but stark differences in the execution of their values. This is not to say The North Face is in any way unethical or unsustainable. The two companies do not compare quantitatively, because size impacts revenue and operations impact profit. The North Face, as a brand within VF, is likely significantly larger in size. But the “bottom line” metric that creates parity is telling revenue per employee.
The North Face’s revenue per employee is $101,266. Patagonia’s is $209,090 per 2021 statistics presented by Zippa.
Karmic Consciousness has its benefits.
About Adam Vasquez
Founder and CEO of MERIT, Adam Vasquez is the first economist to fully identify and describe the process of Market Invention in actionable marketing terms. A highly sought-after consultant, business speaker, author and executive coach, Adam has 20 years of experience in business management, sales, marketing, digital transformation, and strategy. In recent years, Adam has leveraged Market Invention’s potential to generate billions in market value for organizations in North America, Europe, and Asia. His mission is to bring the powerful paradigm of Market Invention to entrepreneurs and challenger organizations who also are motivated to change the world.
About Denise Kohnke
As CSO of MERIT, Denise is responsible for further codifying Market Invention with macro and micro trends, and ongoing strategic business consultation for MERIT’s clients. She facilitates Market Invention strategy from research/inception, to venture capital support through market development and activation. Denise’s background as a brand-side regional marketing director to agency founder and president brings to MERIT a breadth and depth of marketing experience few can claim. Her book, All the Other Marketing Books are Crap, is an irreverent but actionable discourse on strategy for business owners, marketing directors and agencies. In January, Denise was named a 2023 Wisconsin Titan 100 recipient.