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Hard-Core Philanthropist

Using profits from Adam & Eve, his adults-only mail-order company, Phil Harvey has financed a worldwide family-planning network.

When he's in North Carolina—and not, say, quizzing prostitutes in Vietnam or strategizing with street vendors in Bangladesh—Phil Harvey, founder and chief executive of the world's largest mail-order purveyor of sexual merchandise, works out of a cramped corner office at his company's headquarters. The three-story building, which employees jokingly refer to as "the sex factory," hugs a man-made pond in a corporate park outside Chapel Hill. On the surface, the offices of Adam & Eve look like those of any midsize merchandiser hawking computer cables or toll-free calling cards. Color printouts of charts and graphs line the walls, breaking down sales figures and projections in every possible configuration. A corporate family tree fills a display case across the hall from a 24-hour call center, which is packed full of women with hands-free phones dangling from their ears.

But travel farther, into the offices and cubicles, and it becomes clear that this is not the domain of H&R Block. Balanced on desks, beside photos of spouses and children, are brightly hued dildos, translucent vibrators, and stacks of salacious videos. In an attached warehouse, lubes, lotions, love dolls, strap-ons, and pornographic movies are hustled off shelves and onto a conveyor belt that automatically drops the merchandise into zip- code-specific troughs. Orders placed over the Internet or through the company's catalog are processed here and then shuttled out the door to spice up sex lives from Topeka to Santa Fe.

Last year, a typically prosperous one for the company, about $80 million worth of merchandise left this warehouse. And as usual, Phil Harvey took home a hefty paycheck. In the more than 30 years since he started Adam & Eve out of a tiny storefront in Chapel Hill, Harvey has pocketed many millions in profits—and he's given much of it away.

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Adam & Eve, which seven years ago began producing its own X-rated movies, is a peculiar porn powerhouse. It's probably the only major player in the $4 billion adult-entertainment business that was first conceived as the fundraising arm of a nonprofit organization. Harvey founded the company while still a graduate student at the University of North Carolina's School of Public Health, hoping to use the profits to fund family-planning initiatives in the developing world. And as the company has grown, Harvey has remained committed to that early goal—exploiting the voracious spending power of the American libido to tackle population growth and, later, the spread of AIDS overseas. "I was very taken with the idea that I could sell sexual accoutrements to relatively wealthy Americans and use the proceeds to support family planning in developing countries," he says. "I've certainly taken a great deal of pleasure from the sort of Robin Hood effect that's resulted."

In his nonprofit work, Harvey's independence from traditional donors has given him the flexibility to go where others cannot. In the early '90s, when a U.S. embargo squashed the distribution of condoms in Haiti, Harvey's representatives stayed on to ensure that birth control remained cheap and abundant. In Ethiopia, his organization has joined forces with the military, selling millions of condoms at no more than a penny apiece. Soldiers are required to carry one whenever they head off base. The program has helped keep the army's HIV infection rate among the lowest on the continent, around 5 percent (many African armies have rates as high as 30 or 40 percent).

Elsewhere, Harvey has used his marketing savvy—the same talent that helped make Adam & Eve a pornography giant—to turn contraceptives from a dowdy, sterile accessory into an attractive consumer product. Last year DKT International, the nonprofit he runs out of an office at 19th and M streets in Washington, D.C., sold nearly 350 million condoms and 20 million birth control pills in eight countries, as well as female condoms, IUDs, and injectable contraceptives—all at a small fraction of retail costs. Distributed by local merchants and promoted with zippy slogans on TV and radio, as well as on hats, T-shirts, and billboards, DKT's condoms now dominate the market in Indonesia, Ethiopia, the Philippines, and Vietnam. In Brazil, they are one of the top three brands.

In each of his vastly different arenas, Harvey has achieved considerable prominence and respect. In the United States he's held up by colleagues as a free-speech icon for having survived a string of federal obscenity charges beginning under the Reagan administration; in the years since, a majority of porn producers, eager to be included in Adam & Eve's catalogs, have adopted his company's standards, which prohibit depictions of forced sex.

Among the family-planning set, Harvey's focus on commerce once earned the scorn of experts, who relied on doctors and nurses to promote birth control. But over the years, his "social marketing" approach has gained a growing number of converts. "Phil's had a terrific impact on the world of family planning," says Bill Schellstede, senior vice president of Family Health International, a research-focused nonprofit in North Carolina that concentrates on overseas AIDS prevention and family planning. "While the model he's pushed doesn't fit easily with a lot of the more traditional approaches, it's hard to deny that commercial distribution systems have an infinitely greater reach into the population than voluntary organizations or even governments."

Although Harvey didn't invent social marketing, he's been one of its most vociferous champions. Malcolm Potts, a family-planning professor at the University of California, Berkeley, has called him the "guru of social marketing," and even Jimmy Carter has read Harvey's 1999 book, Let Every Child Be Wanted, a detailed how-to on the confluence of family planning and social marketing that the former president praised as "lively and interesting."

For 30 years Harvey has remained ensconced in both his commercial and nonprofit enterprises, with surprisingly little negative fallout. "In the early days I was terrified that, because of Adam & Eve, we were going to lose support for some of our programs," he says. "It never happened. I think part of the reason was that the key people in charge of family planning overseas, even in conservative governments, are not the types who are likely to be upset by sex products. After all, they're in the sex business themselves."

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