Social enterprises are businesses that work toward an unconventional kind of business aim – they go after innovative ideas to help solve community problems. Where commercial entrepreneurs identify opportunities in areas where consumers have unmet needs, social entrepreneurs identify ways in which society is stuck, and find convincing ways out of them.
Social enterprises do profit from their work; profit tends to not be their foremost aim, though. They have bigger goals. They tend to measure their success by their ability to bring about social change, and consider profit as incidental.
What are social enterprises?
According to Ashoka,
a vast worldwide network of social entrepreneurs
, these businesses aren’t simply about identifying solutions to social problems. Rather, they aim for fundamental change much as startups with revolutionary ideas do. Just as WhatsApp revolutionized the way people communicated by turning messages into a free commodity and disrupting the way telecom companies operated, social entrepreneurs try to solve social problems by completely changing the way a given social system operates. Social enterprises are in the business of sweeping, revolutionary change.
Why is social entrepreneurship so successful?
Mohammed Yunus founder of the award-winning micro-lender Grameen Bank in Bangladesh is one of the world’s most famous social entrepreneurs. Blake Mycoskie’s TOMS Shoes social enterprise that donates a pair of shoes to the poor every time someone buys a pair of shoes by the TOMS brand is another famous example. Xavier Helgesen’s Better World Books that has set up a system to get used or discarded books to schools in poor countries around the world is yet another example. They all solve a social problem, are profitable, and also bring about fundamental change of some kind.
Lately, social entrepreneurs have focused on green aims such as renewable energy. In Asia, Latin America, sub-Saharan Africa and the Caribbean, the work done by the Barefoot and the Business Call to Action social enterprises have been bringing solar power to millions. Others like Solar Mosaic are aimed at finding crowdfunding for solar projects in poor communities. Recently, Britain saw the launch of the Community Energy Challenge – a competition to encourage ideas in community renewable energy generation. Environmental social entrepreneurship could be the next big thing in this country.
Social entrepreneurs and their success stories have taken the world by storm. These people have been creating networks and systems, and have been changing tradition for the common betterment. Where old-world political will has only produced inadequate change, social entrepreneurs have brought in refreshing new energy. While doing all this, they have put more than ₤50 billion into the economy each year in Britain, and employed hundreds of thousands.
What does it take to be a successful social entrepreneur?
The process of
finding success as a social entrepreneur
is surprisingly similar to the process that regular, commercial enterprises follow.
You need a business plan
: Social or commercial, any enterprise needs a complete business plan that lays out a map for how the business is to move forward.
You need to raise investment, and account for it
: Social enterprises find their money on crowdfunding sites like IndieGoGo and KickStarter, from investors and venture capitalists. Investors come aboard hoping to be behind an idea that changes the world. Investors in social enterprises always demand to see full accounting of all the funds that they offer. It takes serious accounting skills to take a social enterprise to success.
You need to pay your bills
: A social enterprise needs to pay its, rent, its salaries and its utility bills just the same as any commercial enterprise. Skills in budgeting, financial management and administration, then, are critical. Planning efficient operations, managing cash flow, and using the services of utility and insurance comparison services such as
Make It Cheaper
to find good utility contracts are all of fundamental importance.
You need to find a team
: Social enterprises need talented workers and partners just the same as commercial enterprises. It takes great persuasive skill to bring such people on board. The fact that an enterprise is about doing good doesn’t make hiring a team for it any easier.
Running a social enterprise and holding big dreams about changing the world may not always be productive. Rather, concentrating on getting the job done one day at a time is what works.
