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Karen Vander Molen:How many businesses have been started by PEP grads?
Karen Vander Molen:What kinds of businesses have PEP grads started?
Jeremy Gregg:Here I am!
Melvin Maltz:Hello Jeff and Jeremy. Why do you work so hard for PEP?
Jeremy Gregg:Jeff -- Your comments are in the comments bar. That alright?
Jeremy Gregg:Hello everyone! THank you for logging on to our Tawk. I am grateful for your interest in learning about the Prison Entrepreneurship Program.
Rachael Workman 💥:Hey Jeff it looks like you are logged on as a different Jeff Smith account
Jeremy Gregg:Regarding my background, I first began my relationship with PEP back in 2007. I then met one of our staff (Chris Quadri) and was amazed by the story that he was telling me about PEP.
Rachael Workman 💥:different picture and profile info... :)
Jeremy Gregg:Chris was very impressive as a business leader, and I was astounded by the clarity of his vision for transforming lives through the PEP model.
Jeremy Gregg:But what really shocked me was when I learned that he was a graduate of our program!
Jeremy Gregg:He invited me to join him in prison, and I am very grateful that I accepted his offer. My first event was a PEP graduation in 2007, and I met men at that day who remain dear friends of mine.
Jeremy Gregg:I then began volunteering in 2007 and joined the Dallas Advisory Board for PEP in 2008. I continued to serve as a volunteer until 2012, when I was provided the opportunity to join the staff.
Jeremy Gregg:I am privileged to now serve as the Chief Development Officer for PEP. I lead our efforts to share the PEP story with the world and to secure the resources that we need to expand our mission.
Jeremy Gregg:Hello Jeff and Jeremy. Why do you work so hard for PEP?
Jeff Smith:apologies for the technical problem
Jeremy Gregg:Great to see you Melvin! I learned long ago that when you find a job that you love, no day feels like work.
Jeff Smith:And I - as regular followers know, as a professor of public policy in The New School's urban policy grad program
Sara DeConde:Hi! Really happy to be here, thanks for your time. Can you talk a little about the application process for PEP participants? Is there an evaluation?
Jeff Smith:and a former Missouri state senator
Jeff Smith:and a former federal prison inmate, in SE Kentucky
Jeff Smith:Ergo, my interest in PEP
Jeff Smith:so Jeremy: tell us from soup to nuts what PEP does
Jeremy Gregg:Thanks again for the invite, Jeff. I am still amazed at how I found you ...
Jeff Smith:u can tell that story too if you like
Jeremy Gregg:For those who don't know, Jeff gave an amazing TED talk about his experience in prison. I discovered that TED talk on my drive to prison one day. It was the day after I had given a TED talk of my own about PEP.
Jeremy Gregg:I was astounded to see that the universe was aligning in such fashion!
Jeremy Gregg:And while I should not admit this, I could not resist using my phone while driving to look up Jeff on Twitter. I messaged him, and within a few minutes he replied. Months later... he was our graduation keynote speaker in prison!
Jeff Smith:Haha. And it was one of the most moving experiences of my life
Jeremy Gregg:So for those who have not seen Jeff's talk, it is worth a few minutes of your time:
Jeff Smith:I watched a couple hundred inmates who were far better behaved, and more intellectually curious, than just about any group of grad students I've ever taught!
Jeff Smith:Jeremy: tell us about the 7-month process that led to what I saw
Jeremy Gregg:So, to Jeff's question on PEP. In brief ... we are a public-private partnership with the Texas Department of Criminal Justice that harness the power of entrepreneurship to transform the lives, families and future of incarcerated men.
Jeremy Gregg:We are a private 501(c)(3) nonprofit that receives $0 from the state, but we could not exist without our amazing partnership with TDCJ and the GEO Group (the private operators of the prison where we work).
Jeremy Gregg:So, let me back up to what happened to the guys whom Jeff met in prison before they were at graduation.
Jeff Smith:OK, so let's start near the start and take Sara's question:
Jeff Smith:Hi! Really happy to be here, thanks for your time. Can you talk a little about the application process for PEP participants? Is there an evaluation?
Jeremy Gregg:Thanks Sara! Yes, happy to do so.
Jeremy Gregg:In Texas, there are over 154,000 people in prison. About 92% of them are male, which is why we currently focus on serving men.
Jeremy Gregg:Within this pool, there are about 10,000-12,000 who are eligible for PEP at any time.
Jeremy Gregg:Eligibility means they are getting out of prison in the next few years, they have not committed a sex crime, they are not involved in a gang, they have no major disicplinary case against them in past year (i.e. they have been following prison rules)
Jeremy Gregg:and they have their GED
Jeremy Gregg:Twice per year, we invite about half them to apply to be a part of PEP by first sending them a postcard about PEP.
Jeremy Gregg:So, 4,000 or so postcards go out twice per year.
Jeff Smith:and then there is a rigorous interview process, no?
Jeremy Gregg:We then get 2,000+ letters back from inmates asking for an application. These letters are at their expense.
Jeremy Gregg:We then mail them the application, which is aobut 20 pages long, and ask them to send it back. We get over 1,200+ who do so twice per year.
Jeremy Gregg:WE then send them a study guide (AP Writing Style guide, Business Vocab and PEP 10 Driving Values) to study and tell them that we will test them in 2 weeks.
Jeremy Gregg:We then arrive at their prison 2 weeks later with our version of the SAT
Jeff Smith:(Karen, we'll get to your q's in just a bit)
Jeremy Gregg:it is a 50-question Scantron test on the topics they studied
Melvin Maltz:I have to go to work, proud of your efforts today
Jeff Smith:ok, let's finish up the app process so we can get to the meat of the program
Jeremy Gregg:we then interview those who score above a 70%, as well as some who score below but whose applications were very strong
Jeff Smith:which is amazing
Jeremy Gregg:we then interview them, and select the top 100-150 to start our program
Jeff Smith:OK, so once they're in, who do they meet?
Jeremy Gregg:So, it is easier to get into an IVy LEague school than to get into PEP
Jeremy Gregg:When they are accepted, the TDCJ transfers them to the Cleveland Correctional Center where they go through final interviews wiht "peer panels"
Jeremy Gregg:this is what is going on this week
Jeremy Gregg:as we speak
Jeremy Gregg:if they make the cut past their fellow inmates who are PEP graduates, they enter a three-step in-prison program
Jeremy Gregg:led by a PEP Graduate who is now on our staff, Phi Tran, as well as his team of fellow graduates such as Pat McGee (manager of prison initiaitves) and Michael Potts inside the prison
Jeff Smith:thank you Melvin - appreciate the support!
Jeremy Gregg:Step 1 is a 3+ month program focused on character development, about 20 hours per week
Jeremy Gregg:Step 2 is a 6-month business plan competition about 40 hours per week, ending with the graduation that Jeff keynoted
Jeff Smith:so the biz plan
Jeremy Gregg:Step 3 is the servant leadership program, in which graduates then lead the programs for the inmates who come behind them
Jeremy Gregg:yes, the biz plan
Jeff Smith:so look jeremy
Jeff Smith:when i was locked up
Jeff Smith:the dudes i met threw out biz concepts the same you'd lean em at Wharton
Jeff Smith:which is what inspired my TED talk
Jeff Smith:territorial expansion?
Jeff Smith:"when that muthaf**ka on the Westside got chalked I had my dopeboys out on the corner 'fo the body was cold"
Jeff Smith:and they understood new product launch, quality control, sales and marketing - in a very raw way, but they totally got it
Jeremy Gregg:Plenty of inmates have been successful entrepreneurs in the past. They understand profit margins, proprietary sales channels, customer retention .. they just had an illegal product
Jeremy Gregg:PEP redirects that same drive into a positive channel where they can build legitimate enterprises
Sara DeConde:What is average age or age range of participants?
Jeff Smith:So you guys are harnessing those natural entrepreneurial skills
Jeremy Gregg:For example, nearly half of our recent graduates never even met their own father
Jeremy Gregg:so they never had that role model to encourage them
Jeff Smith:But some might ask - you guys are just a nonprofit, what do you know about starting a business?
Jeff Smith:how do you solve that one?
Jeremy Gregg:Every nonprofit is a business. We simply do not pay income tax. In every other way, we are a business. We have financials, we have customers, etc.
Jeremy Gregg:But yes, I get that a lot.
Jeff Smith:but wait
Jeff Smith:it's not you guys advising the prisoners - it's a bunch of C-suite execs too!
Jeremy Gregg:We have had over 600 different executives volunteer in prison this year
Jeremy Gregg:Some of whom have built and sold very significant businesses
Jeremy Gregg:At PEP, career criminals sit eye-to-eye with entrepreneurs who have sold businesses in the 7- and 8-figures
Jeff Smith:how do you get 600 successful executives to even THINK about walking inside the fence?
Jeff Smith:What kinds of businesses have PEP grads started?
Jeremy Gregg:Entrepreneurs are a remarkably generous group of people ... because they have seen how many people believed in them when they were beginning.
Jeremy Gregg:And yet, they are not interested in low-impact charitable programs that do not change people's lives
Jeremy Gregg:they like PEP because we are a results-oriented social enterprise, not a charity
Jeff Smith:that is such a great point. can you answer Karen's questions? I know I watched pitches for personal training companies, health food companies, and even a publishing company focused on prisoners' writing
Jeremy Gregg:KAREN - Thanks for the question. We have had 1,000 men graduate from PEP now, and the vast majority of their businesses are "main street" businesses
Jeremy Gregg:Tradesmen businesses like home repair/remodeling, car repair, lawncare, barber shops, restaurants
Jeff Smith:i saw corporate janitorial businesses, landscaping, barber shops
Jeremy Gregg:Shoe shine business, candy makers, print shops,
Jeff Smith:I saw a superb biz plan for a home health care company. and another guy who was planning a business making special safety helmets for guys who "frack"
Jeremy Gregg:A few occassionally propose something like an app or something that is a hyper-growth opportuntiy
Jeremy Gregg:And we occasionally have unique products/inventions
Jeff Smith:and Jeremy, the execs who nurture these guys come for a Shark Tank-like day near the end of the program
Jeff Smith:describe that briefly
Jeremy Gregg:but most of the businesses are the kinds of firms that provide the backbone to socity
Jeremy Gregg:Yes, we have monthly events in prison, and many follow a Shark Tank-like experience that is modeled after similar business plan competitions at leading MBA programs around the country
Jeremy Gregg:the guys stand in front of panels of executives and entrepreneurs to give a 2-, 5-, 7- or 10-minute pitch on their business
Jeremy Gregg:it begins with elevator pitches at the early stages of class and ends with a full pitch including financials, marketing, brand differentiation and capital needs
Jeremy Gregg:and the volunteer panelist are asked to respond as if they were making real investments
Jeremy Gregg:So, for example, we give them $10,000 in "PEP Bucks"
Jeremy Gregg:and tell them to vote with their dollars
Jeremy Gregg:the pitch that raises the most money wins
Jeff Smith:so I came and watched the finalists and Jeremy, I may have told you this, but the poise of the presenters exceeded that of most professors I have watched present their research at conferences
Jeremy Gregg:all of our guys take a Toastmasters class in prison
Jeremy Gregg:and pitch their plan 120+ times outside of these events
Jeremy Gregg:so yes, we are very focused on high quality pitches
Jeff Smith:and I know we're talking PEP bucks = Monopoly $, but isn't there also a mechanism for interested executives who volunteer to potentially actually invest if the business plans come to fruition once prisoners are released?
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Jeremy Gregg:Yes, once they are released and stabilized, we have multiple channels for investing in their businesses.
Jeremy Gregg:The latest is through KIVA ZIP, which crowdfunds loans from people all over the world to capitalize our graduates' businesses.
Jeff Smith:wow, that's a great partnership
Jeff Smith:and you have produced at least million-dollar business, no?
Jeremy Gregg:Loans are ZERO interest
Jeremy Gregg:which is awesome
Jeremy Gregg:One guys is raising capital right now
Jeremy Gregg:You can invest as little as $25 and you will be repaid over a 2-year peiord
Jeremy Gregg:this is NOT a gift but a loan
Jeremy Gregg:Jeff, yes, we have produced 2 businesses that are now generating $1MM+ in annual revenue
Jeff Smith:what an awesome story to tell potential donors
Jeremy Gregg:one is a specialty auto parts company
Jeremy Gregg:the other is a demolition hauling company
Sara DeConde:How many hours of instructional time do participants receive each week? When working on their business plans, is the process pretty individualistic or collaborative?
Jeff Smith:(esp corporate donors)
Jeremy Gregg:and those are just the two we know abut
Jeff Smith:and isn't there a guy with a corporate cleaning service who's doing great?
Jeremy Gregg:there might be others, but as you can imagine our graduate entrepreneurs are hesitant to tell us how much money they are making
Jeff Smith:maybe in Houston?
Jeremy Gregg:because they know I will ask them for some!!!!! :)
Jeremy Gregg:In fact, one out of every three gifts that we receive for PEP is from a graduate ... so we are serious about asking them to donate.
Jeff Smith:i'd be hesitant too, because then you'll hit them up for big bucks! (among other reasons more, um, real)
Jeremy Gregg:PEP: Transforming felons into philanthropists!
Jeff Smith:so f*cking cool
Jeff Smith:so look Jeremy
Jeremy Gregg:We have at least 2 or 3 graduates who have already donated $1,000+ this year
Jeff Smith:that's awesome
Jeff Smith:but look
Jeremy Gregg:You owe me push-ups for that, Jeff :)
Jeff Smith:let's be real
Jeff Smith:LOL - I do 500 a day regardless, habit i developed in prison, but I'll do an extra 100 for u J
Jeremy Gregg:I did 500 .... in the last five years. :)
Jeff Smith:but for real: bright and ambitious as most of these guys are, most won't start million dollar businesses.
Jeff Smith:but is there a broader impact you're having?
Jeremy Gregg:WE have released about 900 graduates and they have started 150 businesses
Jeremy Gregg:which is a higher rate of business starts than most MBAs focused on entrepreneurship
Jeff Smith:that is amazing.
Jeremy Gregg:but the majority of our guys do not pursue their own business
Jeremy Gregg:at least for now
Jeremy Gregg:HOWEVER, almost all of the ones who are working for someone else are working for a small business
Jeff Smith:(and we forgot to say why entrepreneurship makes so much sense for this population: because of the dreaded question on a job application)
Jeremy Gregg:not a big corporation
Jeremy Gregg:Yes, 40% of all ex-offenders are unemployed
Jeff Smith:i wish big companies in this country would set an example
Jeremy Gregg:For those who do find a job, they typically earn 20-40% less than they did before prison
Jeff Smith:i guess if you're a criminal, you can't get hired on Wall St, except for the CEO and CFO positions
Jeremy Gregg:So we believe that the best path to creating wealth is for ex-offenders to create their own economic opportunity through entrepreneurship
Jeff Smith:that's great. let's talk even more broadly about social impact
Jeremy Gregg:Let me share one thing
Jeff Smith:work is a huge part of not re-offending
Jeff Smith:but family is another
Jeff Smith:u guys do anything there?
Jeremy Gregg:The solution to the problem of high unemployment among ex-offenders is to create more job opportunities for workers with a prior felony charge.
Jeremy Gregg:From our decade of experience at helping ex-offenders to secure employment, we have found that the most felon-friendly employers are those companies that are owned and operated by ex-offenders themselves.
Jeremy Gregg:Our Theory of Change: “A felon-owned business is a felon-friendly employer.”
Jeff Smith:makes sense
Jeremy Gregg:Therefore, we are focusing on creating more firms like thiks
Jeff Smith:the first research assistant i hired at The New School was a grad student who'd been locked up twice.
Jeff Smith:anyway, you guys work to reunite offenders with families members who'd fallen out of touch?
Jeremy Gregg:Yes, very much
Jeremy Gregg:WE reach about 1,000+ family members per year
Jeremy Gregg:Including hundreds of children
Jeremy Gregg:who have about a 70% chance of following their father's path into prison
Jeff Smith:Oh man. that's great. saddest moments for me in prison were watching guys say goodbye to their kids at the end of visiting hrs, the kids being pulled off of them. tearing up just thinking abt it, esp now that i have kids
Sara DeConde:Do you foresee any opportunities to adapt PEP to help chronic offenders not in prison? Like court sanctioned classes of some sort?
Jeff Smith:and what does this all add up to?
Jeff Smith:like, i assume you're tracking recidivism rates among grads?
Jeremy Gregg:Yes sir!
Jeremy Gregg:We reduce recidivism by 80-90% compared to the state average
Jeff Smith:and the TX state avg is, interestingly, about half the fed avg
Jeff Smith:so the standard of comparison is not easy at all
Jeremy Gregg:This means that every $1 that donors invest into PEP drives a $3.40 savings to the government
Jeff Smith:holy s*it
Jeremy Gregg:you owe me more push-ups :)
Jeff Smith:up to 700
Jeremy Gregg:Many things drive this
Jeremy Gregg:but let me share what we have learned
Jeff Smith:In a perfect world, then, the state would join metrics-minded philanthopists in contributing to PEP
Jeff Smith:yes: sum it up for us
Jeremy Gregg:We have seen that, even for PEP graduates, they are TWICE as likely to return to prison if they go back home immediately after release than if they first move into a PEP transition house
Jeremy Gregg:so, you can do as much as you can inside prison, but the real work begins after release
Jeremy Gregg:we have to address the re-entry issue
Jeremy Gregg:PEP succeeds because we build a community of support and accountability aroudn the lives of our graduates
Jeff Smith:yep. forgot to even ask about these transition houses you guys are now running to help guys
Jeff Smith:Jeremy, one thing that freaked me out when i was locked up
Jeremy Gregg:that keeps them off the streets and away from bad influences
Jeff Smith:is that a couple guys started fights when they were just about to leave
Jeff Smith:because they were terrified of going home
Jeremy Gregg:o hyes
Jeremy Gregg:there is so much fear
Jeff Smith:i know that wouldn't make sense to most people.
Jeff Smith:but once you've seen it up close, it does
Jeremy Gregg:That is because many of them are returning to a deeply broken home where they might die
Jeremy Gregg:Especially if they've had gang involvmeent
Jeff Smith:and everything you guys do - from the application process thru the business plan and char development and the transition houses - helps prepare these guys to make it on the outside
Jeremy Gregg:or they are going to release from prison owing $40,000+ in back child support
Jeremy Gregg:so from day one they have an ax over their head
Jeff Smith:I gotta wrap this up but God bless you and PEP for the amazing transofrmative work you are doing
Jeremy Gregg:Appreciate that
Jeff Smith:it is so awesome to see a non-profit that is so results driven and so impatient with bullshit
Jeff Smith:that so many NPs get preoccupied with
Jeff Smith:HA! 800 my friend.
Jeremy Gregg:What is average age or age range of participants?
Jeff Smith:Hey last thing:
Jeremy Gregg:Sara -- the rnage is basically low 20s to early 60s
Jeff Smith:if people wanna learn more about PEP, where can they go?
Jeff Smith:and real quick
Jeremy Gregg:or www.iWasInPrison.com
Andrei Berman:ughhhh I missed most of the task! NOOOOO. Such a great topic.
Jeff Smith:answer sara's q quickly
Jeff Smith:How many hours of instructional time do participants receive each week? When working on their business plans, is the process pretty individualistic or collaborative?
Jeremy Gregg:Average age is mid-30s
Jeff Smith:my sense is that it's VERY collaborative
Jeremy Gregg:40 horus per week of college-level programming
Jeff Smith:I honestly was floored by how hard guys were rooting for one another
Jeremy Gregg:plus homework
Sara DeConde:Awesome! Thanks!!
Jeremy Gregg:plus they receive support from remote business plan advisors who help provide research since our guys cannot use Internet in prison
Jeremy Gregg:You can volunteer from your desk anywhere in the world: http://pep.org/advisors/
Jeff Smith:listen, thanks to everyone for joining us - and thanks so much to Jeremy Gregg for taking the time and for his amazing, transformative work.
Jeff Smith:hope you all get involved - it's easy!
Jeremy Gregg:By the way, check out this 2-minute video on PEP
Jeremy Gregg:And please share it!
Jeremy Gregg:Thank you Jeff and everyone who joined. See you in prison!