Social entrepreneurship is a truly powerful, revolutionary idea. It’s quite literally changing the way the world works. Social entrepreneurship (aka social enterprise or social business) is essentially business with social objectives in mind. A social business doesn’t focus on profit, while a regular for-profit business wants to maximize profits in order to benefit its shareholders. Instead, a social business has certain clearly defined social objectives which it pursues regardless of profit. A social business will reinvest any profit back into the business after the initial investors have been paid back. The concept of social business is revolutionary because it brings the competitive edge of business to work traditionally confined to charities and NGOs. Social business can be the next step up from charity and become truly sustainable with incredible, quick growth because of its business acumen.
In his book “Creating a world without poverty,” Muhammad Yunus argues that social business eventually needs to become as common and pervasive as regular for-profit business if the world is to significantly change for the better. Yunus, the visionary champion of microfinance and Nobel Prize Laureate, has gained worldwide acclaim for his own social business ventures - ranging from the innovative microfinance services provided by Grameen Bank to a social business initiative with Dannone yogurt aiming to provide nutritious yogurt for poor schoolchildren in Bangladesh for a very low cost. Yunus envisions a world where eventually, there will be a social business stock market and the general public considers social business as worthy of investment as for-profit businesses.
Prof. Yunus must certainly feel gratified, for today microfinance - as well as the broader movement for social business - is becoming incredibly popular and has gained so much public attention. Charity has always been considered a “dirty word” of sorts - because people envision charities as always asking for money. But social business is exciting and novel and more than that — it’s considered cool. As a result, there is currently a social entrepreneurship craze. Starting with Ashoka and the Skoll Foundation, there are now tons of social entrepreneurship competitions and contests. I can name a dozen off the bat. It’s because innovation is inherently exciting.
But is social entrepreneurship then becoming just a buzzword? The problem is the obsession with innovation. Innovation is important, but is it really necessary to constantly innovate? I believe it’s more important to work towards scaling up innovations and programs that are already known to be effective. By effective, I mean: programs and organizations that are really creating social change, helping the most number of people, and truly improving lives in a sustainable manner. There are so many great programs out there that employ innovative - but more importantly, effective, models and technologies. These programs deserve more support and funding, and need to be recognized for the incredible impact they make. Innovation simply for the sake of innovation is unnecessary. And innovating just because it sounds cool and exciting is definitely not necessary.
Why can’t some of these budding entrepreneurs shift their focus to working on some of the pre-existing successful programs? It takes so much time and energy to create your own social business. Starting from scratch is a painful and slow process. Getting funding itself a huge challenge. I’d argue that there are many ways you can contribute more by joining or working for nonprofits that have effective models and need your help to grow and reach more people. Why isn’t the spotlight on these programs and models? We really need to get back on track and focus on proven solutions that work.
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