Social Entrepreneurship: What Is It and Why Should I Care?

You may have attended a conference where there was a workshop on it. Or maybe you noticed an article about it in some professional journal. And someone at a recent board meeting suggested (in passing thankfully) that your organization should be engaged in it. But the question that you want answered and are afraid to ask is: What is everybody talking about…What is social entrepreneurship? And perhaps, added to that is the question of why you should be interested.

A Definition of the Concept
 

The field is young and dynamic. Consequently, there is not yet universal acceptance on the definitions of terms commonly used in the field of social entrepreneurship (SE). Even the concept itself is still somewhat in flux. Nevertheless, when using the term, most people have these elements in mind:
1. The purpose of SE is to address some significant social problem, particularly problems that appear to be intractable. In other words, whatever the enterprise is, it aims to contribute to the common good.
2.  In approaching their identified problem, social entrepreneurs insist on employing best practices from business (such as market analysis, for instance, or strategic planning).

3.  Social entrepreneurs highly value innovation too – not for its own sake but rather because conventional approaches to the problems they seek to address have not yielded sufficient or satisfactory resolutions.
4.  Most are committed to a “triple bottom line”: social justice, financial self-sufficiency, and environmental sustainability.

While SE projects typically employ a nonprofit corporate framework, on a practical level the line between for-profit and non-profit is somewhat blurred because it is simply less relevant in the social entrepreneurial context. For example, social entrepreneurs would not say, “Let’s provide the community this service until the charitable dollars supporting it run out.” Instead, they would ask, “What income streams can we develop which will be steady enough to support the project in the long term?”

Some Illustrations
 

Identified as such, the SE movement is relatively new. Yet scattered across the pages of history are individuals who fit the description. One example is Dr. Maria Montessori (1870-1952) who founded Children’s House in Italy and thereby launched a new approach to early childhood education. Another is John Muir (1838-1914) who is appropriately honored as one of the founders of the conservation movement in this country, partly through his founding of the Sierra Club. A current example, who is often identified as a social entrepreneur par excellence, is Muhammed Yunus of Bangladesh, founder of Grammeen Bank. A 2006 Nobel Peace Prize laureate, he pioneered the use of micro-credit as a means to helping people launch businesses and thereby raise themselves out of poverty. (I wish to credit Arc Consulting Team of the Antioch University Los Angeles management program for these examples.)

Why Should Nonprofit Leaders Care about SE?
 

SE represents a fresh new perspective on the issues and the institutions to which we in the nonprofit sector devote ourselves. As with any new movement, there are aspects which are more fizz than substance. Yet results speak for themselves. Social entrepreneurs are making a positive difference in situations that seemed immune to improvement. And so I believe it is reasonable to predict that SE is not merely the latest fad about which there is a buzz. Rather, I believe it will continue to grow in influence. It represents a synthesis of learning across economic sectors (governmental, commercial, and eleemosynary) that can be applied productively to situations which our values demand we address as effectively as possible. So it’s time to read one of those articles on the subject the next time they appear in your professional journal or attend a workshop at a conference. SE is not going to go away…nor should it.