What Is Social Entrepreneurship?

If I Only Could | by bethan | Flickr

“Social entrepreneurship” is a sticky and ill-defined term. Ask the gal sitting next to you on the bus or your brother-in-law over dinner what it is, and you’re likely to get a head tilt and quizzical look. At best, you’ll get a ventured guess at what it sounds like it should be (“Um, entrepreneurship that is social…?”).

But what’s worse is that you’ll also get a slew of jumbled, sometimes contradictory responses if you ask social entrepreneurs themselves. It really is a poorly defined term.

I suppose this predicament is not unlike many other industries: ask a B2B marketer what “marketing” is and you’ll get a different answer than if you ask a marketing director at a non-profit organization the same question. Social entrepreneurship is as multi-faceted and nuanced as most other industries. But it still lacks even a set of good definitions.

I’d like to have a go at defining social entrepreneurship here.

This effort will hopefully satiate my friends and family, who (understandably) want to know exactly what it is that I’m talking about when I go out on one of my social entrepreneurship tangents.  But I also intend for this to be a crack at assembling some of the research & writing I’ve been doing for my Master’s thesis.

Proviso: This will be a brief, “entry-level” attempt to define such a heady term. I don’t have all the answers. Many people are taking their own bids at defining the term (see end of post). The collective is working on it.

Okay. Let’s get to it.

What Social Entrepreneurship Is Not

  • It is NOT about using social media to be an entrepreneur
    (though social media may be used by entrepreneurs as a tool)
  • It is NOT entrepreneurs getting together for drinks or lunch, in an effort to be social
  • It is NOT crowd-sourced entrepreneurship

What Social Entrepreneurship Is

  • It IS social, insofar as it seeks to solve social problems
  • It IS entrepreneurship, because it uses business principles to solve social problems

Our planet faces big problems—from lack of access to clean water, to child abuse, to health epidemics, to destruction of biodiversity, to name only a few. Non-governmental organizations (NGOs) and non-profit organizations (NPOs) are typically thought of as the primary entities that work to solve these types problems (for example, the Red Cross, World Wildlife Fund, Doctors Without Borders, etc.). Organizations like these have done incomparable and high-impact work. But the NGO/NPO sector is saturated with organizations that have conspicuously similar missions—and operations that draw from the same dwindling grant money and donor base.

This especially seems to be true in the United States, where a shriveling economy means fewer handouts and less allotted funding for NPOs. Where many NGOs/NPOs rely on generosity—be it governmental-based, foundation-based or individual generosity—a “non-profit” model is not always going to be the most effectively sustainable model—especially not in an increasingly capitalistic globalized economy.

This is not to say that NPOs and NGOs are doomed. Not at all. They fill a critical role that is not soon to go away. But they can’t solve all of our collective social problems.

Enter social entrepreneurship to fill in some of those gaps.

Social entrepreneurship ventures (SEVs) are often based on missions very similar to NPO missions: to help tackle environmental or social pains. But the SEVs approach solutions in an entrepreneurial way and with more “traditional” business practices.

Now, in the realm of social entrepreneurship there is discussion (argument, at times) about whether non-profit organizations fall under the umbrella of social entrepreneurship. I argue that they don’t. While the missions of social enterprises are usually indistinguishable from NPOs, the operational structures are wholly dissimilar: for-profit versus not-for-profit.

Defining social entrepreneurship - it's not in a dictionary. Yet.

My Definition of Social Entrepreneurship

  • SE resides at the intersection of innovation, entrepreneurship and social change
  • SE emphasizes social value over profit—without leaving profit in the dust
  • SE is oriented to the market and to economic value
  • SE is interdisciplinary and cross-sector
  • SE directs people toward solutions rather than imposing solutions upon them
  • SE often solves problems at a local (sometimes small-scale) level with an emphasis on long-term, large-scale social change

I don’t have a one-line definition for social entrepreneurship. I’m not there yet; I’m not sure the sector is there yet, either. But I do believe—deeply believe, in fact—that definition is incredibly important. Definition is important not just so “social entrepreneurship” can land safely on the pages of Webster’s. Instead, definition is important because it distinguishes the sector—and allows social entrepreneurs to move forward in making social change.

(See how I did that? – I didn’t really provide a definition. Muahaha! But seriously. These are things that I do know about social entrepreneurship.)

Want to see some examples of what social entrepreneurs and what they do? This New York Times slide show, The Faces of Social Entrepreneurship, gives you a succinct look at four social entrepreneurs.

And a recent post by Ashoka Fellow David Castro, What is a Social Entrepreneur, Really? grapples with this question. It’s good reading.

I would love your feedback—whether you’re involved in social entrepreneurship or this is the first time you’ve heard the phrase.

Does this make sense?

Do you have questions about what I’ve discussed here?

Have anything to add or subtract? Tell me!

+++

I’d be remiss if I didn’t point to some of the thought leaders in the SE industry and their definitions. Here is a mini resource list for definitions of social entrepreneurship:

Ashoka – What Is a Social Entrepreneur?

Skoll Foundation – What Is a Social Entrepreneur?

SocialEdge – Defining Social Entrepreneurship

Stanford Innovation Review – Social Entrepreneurship: The Case for Definition

Inc.com – A Crash Course in Social Entrepreneurship

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Image credits – Flickr | ƅethan & greeblie

  • Your definition makes sense to me and I am certainly one of those people who traditionally wouldn’t get it.

    • Alicia – Thank you so much for that feedback. I feel like this is a giant work-in-progress. And I always wish I had a clear answer when people ask me what the heck I’m writing my thesis about. :)

  • Omewan

    very thought-provoking. The post definitely makes me really think about how SE might be a good tool for solving problems our world has, and will continue to have.

    • Thanks, Omewan. :) SE *is* a great tool — one of many, but a particularly effective one, methinks.

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  • Thank you so much for providing a great explanation of social entrepreneurship with fantastic detail, Caligater style. Its great to understand more about what you are working on and see how it can possibly apply to people or businesses I know. To comment here on your tweet about posting entries, I still get nervous too, especially when its something close to my heart and soul. Great post!

    • Thanks, Katrina. I’m glad there was something here that made sense for you. If you need me, I’ll just be over here – kickin’ it Caligater-style. ;)

    • Thanks, Katrina. I’m glad there was something here that made sense for you. If you need me, I’ll just be over here – kickin’ it Caligater-style. ;)

  • Okay, so I kind of get it – very well written, Cali, thank you. But – do you have some examples of companies that are using this model successfully? Who are the SE’s that I might recognize?

    • Thanks muchly, Sarah! Tom’s Shoes (http://www.toms.com/) is one of the most prominent examples. Another amazing organization is actually local to us: Unreasonable Institute (http://unreasonableinstitute.org/) — an incubator for social entrepreneurs.

      I really appreciate you asking the question. It’s inspired a blog post…perhaps a feature post that highlights various social ventures. :)

  • jen

    Cali – what would be the difference in how republicans and democrats view how SE fits into our economy? I ask because you said, “SE emphasizes social value over profit—without leaving profit in the dust.” Yet some people put NPO into SE? I don’t know if I’m expressing my thoughts clearly – I had no idea what SE was before I read this! I would have thought it was using social media to sell stuff!

    • Hey, you! I actually can’t answer the question as to the difference in viewpoint between Democrats and Republicans. (Sorry!) But yes, there’s much talk about whether a *non*-profit can be lumped under SE. I think not–because a non-profit isn’t using traditional business principles, nor does it focus on gaining profit in order to scale/make more change. Sorry if I’m not answering your question. Don’t hesitate to follow-up. :)

      And yes – I’ve talked with lots of people that think SE is using social media to sell — it makes sense based on the term “social entrepreneurship,” no doubt. I think “SE” is not the best phrase or word. “Change entrepreneurship” is closer to how I see it. I’m still pondering it, though… :)

      Thanks, cous!

  • Social Entrepreneurship: finding new ways to get one person to talk to another.

    Then again, I’m painfully literal most of the time.

  • This is exactly why we established Cool People Care as a business – and not a 501(c)3 nonprofit – four years ago. We wanted to show – to prove – that you can solve a social problem with responsible business practices. I would also encourage you to check out the B Corp movement. Inspiring stuff!

    • Sam, I really appreciate you stopping by and commenting. Cool People Care is one of the first social ventures that comes to mind, especially when I think of those that I’m familiar with via the social web.

      B corps are awesome. I think they are an important addition. (For those that may be reading the comments, check out: http://www.bcorporation.net/)

  • Shana

    Hey sis…what, do you study this stuff or something? I can see your passion and drive behind “social entrepreneurship” and your definition fits that. Go get’m!

    • Yeah, I study this stuff…. something like that. ;) <3

  • Alec

    Hi Cali,

    Alec Johnson here. Perhaps you remember me, perhaps not. I saw Shana’s post on FB and want to commend you for your efforts in this.

    At The University of St. Thomas, where I teach Entrepreneurship, we have a distinct focus on this topic, without too much regard for definition, yet I think you are very close to something meaningful. Its as difficult to define as “entrepreneurship” which is like art; you know it when you see it. So, again, everyone’s sensibility to what it is and isn’t is furthered by your offering a place to discuss it. Good work.

    I have three students developing businesses that I think are in the realm of SE. The first is House of Talents http://www.houseoftalents.com started by Kate Herzog. She grew up in Ghana and has given her pitch to my classes several times. I’ve heard her say, “poor people don’t need handouts, they need opportunity.” She grew up very poor in Ghana and understands the distinction. She gives them that opportunity. She’s for profit and absolutely looks like SE to me.

    The second is Anxiety in Teens http://www.anxietyinteens.com I’m working with her daily to develop and sustainable, for profit model without compromise to her mission.

    I sit on the board of a third, DesignWise Medical http://www.designwisemedical.org , a non profit medical design and marketing firm, targeting pediatric applications with markets so small that large medical device companies, like Medtronic, won’t ever touch them.

    Three great case studies for you. Start to perform subjective analysis of the dimensions of each that you think fall into the category of SE. Do that with three firms that don’t…what’s the operation difference between them? Maybe this helps, maybe it doesn’t. In any event, I dig where your head is at.

    • Alec! You rock. I really appreciate the time you took to respond.

      Can I just say I have new fodder for my thesis?!! *high five* :)

      What your student, Kate Herzog, said resonated SO deeply for me: “poor people don’t need handouts, they need opportunity.” Though SE isn’t focused exclusively on “poor people” (much of it is also focused on environmental issues, though such issues are inextricably linked to poorer countries….), the idea of creating opportunity rather than giving a handout is where SE shines through–and beyond–NGOs. I think there’s a place for the aid that NGOs provide. But there’s also the need to help people create sustainability in their own lives.

      That’s incredible that you’re teaching in a program that focuses on this. I’ve been carving out my own way in the master’s program I’m in…and the SE side of things exists at my university, but is lacking.

      I’ve dug around in academic journals (wheee!) (okay, I admit I totally love it!), and the few people in academia who are talking about SE are struggling with definition as much as anyone else.

      Keep me posted, Alec. I really appreciate your insight. Thanks again.

  • Nice job, Cali!! It’s so fun reading your work especially about a topic near and dear to my heart. :) I would actually argue that the Unreasonable Institute is a SE-support organization but probably not a true SEV itself unless there’s something new/different to their funding/finance model that I’m not aware of. I think this is often a component to what makes a true SEV – they have to figure out a create/innovative way for generating revenues and funding their operations because often what they provide is usually in “competition” with the government and NGOs which offer the services/products free to their customers.

    My stance on Unreasonable Institute isn’t an argument that I would die over because I love what they’re doing and how they’re expanding SEs around the world.

    I haven’t read every comment in detail but another good distinction to make about SEVs is that they often tackle “market failures” which is just a fancy way of saying that they find creative solutions for some inefficiencies in the marketplace.

    Lastly, there’s a new business entity called the L3C which will really support the activities of SEVs. It’s not yet approved in Colorado, I don’t think, but should be soon.

    If anyone wants to read about student SEV projects at CSU, check out my alma mater’s page where everyone is experimenting/testing out the SEV model in the world. http://www.biz.colostate.edu/gsse/program/projectExperiences/pages/default.aspx

    Love ya, Cali, for posting this to the world!

    • Lucinda, I *so* appreciate such a thoughtful response. I was hoping you’d weigh in. :)

      You are ABSOLUTELY right about Unreasonable Institute not really being an SEV in itself, but instead is an SEV-support organization. That’s a fantastic distinction – and I appreciate the correction.

      I’m sure this post (and the uber-insightful comments) will turn into another follow-up post. :)

  • Anonymous

    This was a great read. Thanks for sharing and packing it up with plenty of resources.

    Much success with your studies.