How to Become a Successful Social Entrepreneur (via Entrepreneur)
Here is an article in Entrepreneur written by Chris Porteous and posted on December 24, 2020. Click here to read the article on Entrepreneur.
Social entrepreneurship can create lasting and significant social change. HubSpot defines social entrepreneurship as the combination of commerce with social issues. While this is simplistic, it's best considered as a hybrid of governmental intervention and pure business, focusing on issues that aren't significant enough to attract private capital. Social entrepreneurship is more about bringing change to the world in a real way, usually using money and technology to make people's lives better. Millions of individuals worldwide have benefitted from social entrepreneurship schemes, some of them indirectly.
Unlike typical businesses, social entrepreneurship doesn't seek to enrich its investors or owners (at least not primarily). Most of these enterprises are dedicated to providing help to a specific group of people and increasing their standard of living as a result. The most typical social entrepreneurship beneficiaries are marginalized and socio-economically deprived communities that need all the help they can get.
Immediately, most traditional business owners would spot a problem with this model. How does a business like this take care of itself when it depends on investors and charities for its income? The first step towards being a social entrepreneur is ensuring that your model is self-sustaining. To achieve this sustainability level, the business's costs ought to drop as the number of beneficiaries it increases. Sustainability, as we see, isn't just about the business's environmental impact but also translates to its financial status as well. Achieving balance in its earnings compared to its expenditure enables the enterprise to reduce its dependence on philanthropic help.
In most cases, these enterprises are nonprofits, but it is possible to profit from a social enterprise. The Organization for Economic Co-operation and Development (OECD) mentions Grameen Bank, a profitable organization in Bangladesh that focused on social entrepreneurship in the '70s, providing funding for underprivileged borrowers. Grameen Bank is seen as one of the first cases where social entrepreneurship evolved into a profitable company. It became an example that other entrepreneurs would follow. Today's social enterprises use Grameen Bank's model as what they emulate when shifting from a nonprofit into a profit-based business. Let's examine the ways to set yourself apart as a successful social entrepreneur.
Becoming an actor between government and consumers
Jeremy C. Park, CEO of cityCURRENT, engages businesses in the U.S. with a mission to “power the GOOD” and to develop community-focused initiatives that bring stakeholders together in support of nonprofits and charitable efforts to help adults, children, and families who live primarily in the Mid-South and Middle Tennessee areas. Through their events, media and philanthropy, cityCURRENT strategically operates a middle ground by serving as a privately funded catalyst with their resources and a convener for businesses, government, nonprofits, churches, schools, and other stakeholders to unify around a shared sense of purpose. They recognize that government, nonprofits and even social enterprises cannot do it alone, and that creating social change requires navigating politics and complex social systems, and that serving as a catalyst and convener is an important part of becoming a successful social entrepreneur.
In many cases, the government can only provide a framework to allow individuals their rights and freedoms and allow them to seek their own interests. On the other hand, social entrepreneurs can empower those individuals through the application of technology, funded by donations and investors. This technology can be harnessed in several ways by the savvy social engineer to bring about change.
Replacing a key technology with one that costs less
While we pay little attention to the cost of certain essential technologies within the developed world, in other parts of the world, tech might be the difference between life and death. The BBC mentions APOPO, a company that trains rats to search out landmines so that they can be safely disarmed. This particular social enterprise was developed in response to the high cost of safety equipment and infrastructure for locating and clearing mines. Rats are typically too light to set off these mines, but they can easily find them allowing volunteers the chance to set them off or disarm them without risking their own lives. Rats cost a lot less to raise and maintain than other minesweeper technology.
Creating new technology to empower communities
Technology is so ubiquitous in the developed world that we scarcely realize how little of it has permeated the developing world. The development of technology infrastructure can change how people see the world around them and access funding for projects. One of the best examples of this is KIVA. The World Economic Forum (WEF) notes that KIVA can be a social enterprise that leads to positive change for refugees, allowing them access to interest-free loans to get their lives back on track. KIVA provides a simplified way for those who want to donate to the developing world to do so, without having to go through nonprofits locally, which are treated and regulated by banks. The result is a more direct line to an economically displaced person, offering immediate help. This technology helps to bypass the bureaucracy and make a real impact on human lives.
Repurposing existing technology
There's already a plethora of technological advances on the market. Yet those modern advances tend to focus only on the developed world and those that can afford these services. Less economically developed countries may need technological advancements but have no way to apply them in a way that could make a difference. Imazon is a prime example of what is achievable, given the drive to bring about change. As Imazon states on their website, they focus on promoting conservation and sustainable development within the Brazilian Amazon and use tech to track that progress. They do this by repurposing the remote sensing data from Google's satellite images into a real-time update on deforestation within the Amazon basin. The infrastructure already exists, but Imazon realized that it could be used for a cause and applied them to the challenge.
Technology may be the way that social entrepreneurship can make an impact on the world, but by itself, it can be a potent vehicle for change as well. Many of the businesses bringing about real, tangible change today are probably not going to be around to see how their changes affect the future. Social entrepreneurship is not about the rewards but about the help offered to others. It's this focus on the plight of the less fortunate that separates social entrepreneurship from traditional enterprises. The goals of both are the same—offering services to the preferred customer base. The motivation for their provision of services couldn't be more different.
Most business operators will know how difficult it is to run a business to make sure that it's profitable. Imagine how much more challenging it is to create a sustainable social enterprise and wean it off investors and charities? Even though it's challenging, it is doable. Many social enterprises have followed the lead of Grameen Bank and evolved into proper profitable enterprises of their own. Their success and that of others that follow them serve as a road map that successful social entrepreneurs should follow when trying to realize their ideas.