Social entrepreneurship aims to solve social problems through new ventures. There are different types of social entrepreneurs, including social bricoleurs who address local needs, social constructionists who tackle larger issues, and social engineers who create new solutions. In addition to the challenges all entrepreneurs face, social entrepreneurs must meet social and financial goals, maintain their social mission, and attract people with both passion and business skills to overcome additional complexities.
2. Introduction
We live in a world in which social conscience is now a key consideration for
many, if not most, or even all.
As entrepreneurs and tech entrepreneurs continue solving business challenges
of varying nature, there has been a similar rise in entrepreneurs who aim to
solve social challenges – these are social entrepreneurs.
3. Introduction
In this module, we want to introduce this other type of entrepreneurship: social
entrepreneurship.
By the time you get through the module, you’ll be able to:
• Define social entrepreneurship and social enterprise;
• Understand some of the various types and drivers of social
entrepreneurship;
• Identify some of the key challenges of social enterprise; and
• List the factors that are conducive of successful social enterprise.
4. What is Social Entrepreneurship?
In the Journal of World Business, social entrepreneurship is described as:
• “the process that is a catalyst for social change that addresses important
social needs, that is not dominated by financial benefits.”
And The School for Social Entrepreneurs, offers this:
• [...] what business entrepreneurs are to the economy, social entrepreneurs
are to social change. They are the driven, creative individuals who question
the status quo, exploit new opportunities, refuse to give up, and remake the
world for the better.
5. What is Social Entrepreneurship?
Considering it all, social entrepreneurship can be simply considered as:
• “the creation of new ventures to solve social problems”.
Social enterprises, which is the name for the social ventures, draw upon key
concepts of both the commercial and nonprofit worlds to create a unique type
of organisation that can tackle issues that others can’t.
6. Forms of Social Entrepreneurship
Like all other forms of entrepreneurship, social entrepreneurship comes in a variety of forms.
Three types you may hear of are:
• The Social Bricoluer;
• The Social Constructionist; and
• The Social Engineer.
Within each of these, there are different drivers for the entrepreneurship and different ventures
as a response.
• Social Bricoleurs – focus on opportunities to address local, social needs that they are
motivated, and have the expertise and resources, to address – such as upcycling furniture
or addressing local crime. The focus is on matters typically within their communities, which
means ventures have small scope and scale.
7. Forms of Social Entrepreneurship
• Social Constructionists build and operate alternative structures to address
social needs that others, like governments and agencies, can’t, or won’t.
These social entrepreneurs tackle issues that are a little larger than
community-level, and may instead be at the state or national level – such as
preservation of native wildlife or sparking growth in minority groups.
• Social engineers are those that create entirely new offerings to address
social needs, generally because they perceive what currently exists to be
insufficient or broken. These ventures are typically very large in scale and
scope and require a great deal of business acumen to succeed. The
Grameen Bank – the world’s first microfinance organisation whose founder
won a Nobel prize as a result – is a great example.
8. Social Enterprise From Established Orgs
In addition to these three models, social enterprise may also come in the form of a
new venture from an existing organisation.
In line with this, one Canadian nonprofit association offers a model of ‘3 Ms’, to
explain the potential drivers of such a situation:
• The Market Driver: where the aim is to fulfill a gap in the market that typical
commercial ventures won’t e.g. tackling youth homelessness
• The Mission Driver: where the aim is to further the mission of the organisation –
which can happen through publicity or new methodologies that the social
enterprise fosters; and
• The Money Driver: where the aim is to generate new revenue streams for the
established organisation.
9. Social Enterprise is Not, Not-for-Profit
This brings us to an important point: Social Enterprise does not have to equal,
not-for-profit.
One of the things that make social enterprises so powerful is that unlike many
not-for-profit organisations, they don’t rely on external sources to survive - like
donations or government funding. Instead, they create their own revenue
streams like traditional commercial ventures, through selling products, and then
use those profits to fund their social impact initiatives.
Companies like Tom’s Shoes and The Thankyou Group, are great examples.
Be sure to check them out.
10. Unique Challenges for Social Entrepreneurs
Another important point, is that just because social entrepreneurs are out to do good, business
isn’t any easier.
In fact, it can even be more difficult. Social entrepreneurs require all the same discipline and
skill as typical entrepreneurs, plus the passion, dedication and thick-skin to foster change
where most feel it’s impossible.
According to Ashoka, the largest network of social entrepreneurs worldwide, the following 5 key
characteristics are what define leading social entrepreneurs:
A New Idea:
Is the person possessed by a truly new idea for solving a public need? Is it a truly
transformational innovation, or just a tweaking of how things are done?
Creativity:
Is the person creative – both in vision & goal-setting and in problem solving? How creatively
does the person approach opportunities and obstacles – be they oragnisational or political?
11. Unique Challenges for Social Entrepreneurs
Entrepreneurial Quality:
Is the person so committed to their vision that it is impossible for them to rest until the vision
becomes the new pattern across society? Is the person willing to spend years relentlessly
grappling with “how-to” challenges?
Social Impact of the Idea
Is the idea likely to solve an important social problem at the national level or beyond? Is the
idea itself sufficiently new, practical, and useful that people working in the field will adopt it once
it has been demonstrated? If it is, how many people will be affected? How much will they
benefit?
Ethical Fiber
Is the person totally honest? Would you instinctively trust him/her? Is his/her motivation deeply
and firmly rooted in a commitment to serve others?
As you can see, a pretty tall-order for anyone – which is what makes social entrepreneurs
particularly special.
12. Additional Challenges for Social Entrepreneurs
• They need to Meet ‘the double bottom line’ – if not the triple bottom line. Because social
entrepreneurs focus on at least social (or environmental) and financial outcomes (if not all), social
enterprises have a layer of complexity they need to deal with that more typical ventures, simply
don’t;
• They can’t lose focus: As a result of this extra complexity, it’s easy to lose focus on the social
mission of the enterprise. If this happens, there can be a loss of credibility, impact and value;
• They still need business acumen: unfortunately the passion to do social good is only one small
piece of the puzzle. If anything, the business acumen of social entrepreneurs needs to be even
stronger as they not only need to just overcome all of these challenges and create social good,
they also need to run a successful business!
• They HAVE to find the right people: as a result of all of these extra stresses and challenges on
social enterprise, the right people – that have the passion and business acumen – are absolutely
critical. It’s particularly true in social enterprise that the organisation is only as good as its people.