IREX Social Enterprise Orientation Training

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IREX Social Enterprise Orientation Training

• Gbanga, Liberia
• Kim Alter
• Virtue Ventures LLC

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What is social enterprise?
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Hybrid Spectrum
Both Values
Economic Value
Social Value
Social Enterprise
Nonprofit with income activities
Traditional Nonprofit
Traditional Corporation
Corporate Social Responsi-bility (CSR)
Socially Responsible Business
Profit-Making Motive ? Shareholder
Accountability ? Profits redistributed to
shareholders?

• Mission Motive
• Stakeholder Accountability
• Income invested in
• programs or overhead

Adapted from Lee Davis and Nicole Etchart.
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Definition

• A social enterprise is any business venture
  created to address a social problem and generate
  social value while earning income through
  commercial activities.
• In short. solving a social problem with
  business tools and practices.

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What do we mean by social problems

• Example Millennium Development Goals
• Eradicate extreme poverty and hunger
• Achieve universal primary education
• Promote gender equity and empower women
• Reduce child mortality
• Improve maternal health
• Combat HIV/AIDS, malaria and other diseases
• Ensure environmental sustainability
• Develop a global partnership for development

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Social Enterprise Characteristics

• Enterprise Approach the enterprise is the change
  vehicle and uses market principles and
  entrepreneurship
• Social Aims has explicit social objectives
• Value creation solve social problems while
  earning revenue through commercial means,
  generating blended social and economic value.
• Agnostic about legal form Non-profit,
  for-profit, cooperative, hybrid, etc., depending
  on legal environment
• S drives E social value before financial value

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Social enterprise is driven by a social problem
in other words, the business opportunity lies in
the social problem.
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Opportunities in Social Problems
Problems Sustainable Dev. Steps Opportunities for SE
Poverty Generation of employment and livelihood opportunities Creation of micro-business services micro-credit community based enterprises
Non-potable water and sanitation facilities Community participation in search of solutions Subsidized pricing for poor Creation of safe drinking water and sanitation enterprises
Rapid population growth Empower women and promote family planning, maternal and child health Creation of education and health social enterprises sale of contraceptives
Ecologically damaging inefficient technologies Increase the share of renewable energy Promote green technologies Creation of renewable energy/green technology products
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Social Problem IS the Biz Opportunity

• Social Problem
• Food insecurity
• Deforestation
• unemployment
• Illiteracy
• Limited access to health services
• Barriers to employment
• Lost of livelihoods due to poor vision

• Social Enterprise
• Bakery
• Ecotourism
• Credit training
• Publisher/education
• Discount pharmacy
• Café, janitorial, thrift, landscape, etc.
• Reading glasses

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Video Examples of Social Enterprise

• Martin Burt
• Vision Spring
• Greyston Bakery

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Myth BustingSocial Enterprise Realities
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Motivations for starting an SE
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SE Impact on Organization
Source Powering Social Change Lessons for
Community Wealth Generation for Nonprofit
Sustainability, Community Wealth Ventures, 2003
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Mission Alignment
3 of SE dont relate to mission
78 of SE relate directly to mission
Source Powering Social Change Lessons for
Community Wealth Generation for Nonprofit
Sustainability, Community Wealth Ventures, 2003
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Profitability
Foster, William and Jeffery Bradach, Should
Nonprofits Seek Profits, Harvard Business
Review, February, 2005
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The 1st Point

• Social Enterprise is not a quick fix for
  financial ills,
• Running a social enterprise is not easier than
  running a CSO/NGO however
• SE offers nonprofits many benefits including
  financial ones

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The 2nd Point

• Be clear about what you want to achieve with a
  social enterprise
• Purpose
• Objectives

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The 3rd Point

• The greater the integration the easier the
  execution and the greater the chance success.

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The 4th Point

• Social Enterprise can be a vehicle to do more
  social good and create more impact
• It is an ORGANIZATIONAL STRENGTHENING TOOL

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The 5th Point

• Do what you know and leverage what you have to
  start your enterprise

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The 6th Point

• Number ONE factor for success is the DESIRE to do
  a social enterprise
• Business approach fits with organizational
  culture