Self-Understanding for Opportunity Creation
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Neck1ePPT04.pptxChapter 4: Supporting Social Entrepreneurship
LEARNING OBJECTIVES
4.1
Describe what social entrepreneurship is and the role it plays.
4.2
Explain how social entrepreneurship can help resolve wicked problems around the world.
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Learning Objectives
4.3
Identify the different types of social entrepreneurship.
4.4
Explain how social entrepreneurs can use capital markets to fund their ventures.
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Learning Objectives
4.5
Explain the primary attributes of stakeholders and how stakeholders can help or hinder a social entrepreneur.
4.6
Distinguish between corporate social responsibility and social entrepreneurship.
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Learning Objectives
4.7
Assess the value of social inclusion globally within social entrepreneurship.
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Learning Objectives
Notable Quote
“The life purpose of the true social entrepreneur is to change the world.”
Bill Drayton, founder of Ashoka
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4.1 The Role of Social Entrepreneurship
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Entrepreneurship and Society
Entrepreneurs can help preserve and protect future generations through empathy, compassion, and commitment.
The Role of Social Entrepreneurship
4.2 Social Entrepreneurship and Wicked Problems
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What Is a Wicked Problem?
A large, complex social problem without a clear solution, where there is limited, confusing, or contradictory information available, and where a range of people with conflicting values engage in debate.
Social Entrepreneurship and Wicked Problems
Table 4.1: Conklin’s Defining Characteristics of Wicked Problems
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Social Entrepreneurship and Wicked Problems
Credit: Conklin, Jeffrey (2006). Dialogue mapping: building shared understanding of wicked problems. Chichester, England: Wiley Publishing. Reprinted with permission from John Wiley & Sons.
Child mortality
Sanitation
Terrorism
Health and wellness
Environment
Poverty
Sustainability
Equality
Education
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Examples of Wicked Problems
Social Entrepreneurship and Wicked Problems
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Entrepreneurs Solving Wicked Problems
Kickstart: Reducing hunger in Africa
Dr. Venkataswamy: Eradicating avoidable blindness in India
Tony Elumelu: Investing in entrepreneurship for refugees
Social Entrepreneurship and Wicked Problems
Neck, H. M., Brush, C., and Allen, E. (2009) The landscape of social entrepreneurship. Business Horizons, 52: 13-19.
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Figure 4.1: Global Wicked Problems
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Social Entrepreneurship and Wicked Problems
Credit: David Sibbet, CEO of The Grove. Retrieved from http://redarchive.nmc.org/news/communique-2013-future-education-summit. Reprinted with permission.
4.3 Types of Social Entrepreneurship
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Types of Social Entrepreneurship
Social Purpose Ventures
Social Consequence Entrepreneurship
Enterprising Nonprofits
Hybrid Models of Social Entrepreneurship
Figure 4.2: Typology of Ventures
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Source: Neck, H. M., Brush, C., & Allen, E. (2009) The landscape of social entrepreneurship. Business Horizons, 52, 13–19.
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Social Purpose Ventures
Resolve a social problem
Make a profit
Example: PACT
Types of Social Entrepreneurship
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Social Consequence Entrepreneurship
For profit
Makes a social impact
Example: Sword and Plough
Types of Social Entrepreneurship
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Enterprising Nonprofits
Venture mission and market impact for social purpose
Profits channeled back into the organization
Two types:
Earned income activities
Venture philanthropy funding
Types of Social Entrepreneurship
Enterprising non-profits are a form of social entrepreneurship where both the venture mission and the market impact are for social purposes. This means that any profits made must be channelled back into the organization. Unlike social purpose ventures, profit may not be distributed to the owners of the enterprising non-profit. There are over 1.5 million non-profit organizations in operation in the US today, including charities, foundations, and others (see Table 4.2).
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Table 4.2: Quick Facts About Nonprofit Organizations in the United States
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Types of Social Entrepreneurship
Source: NCCS Business Master File 12/2015. Retrieved from http://nccs.urban.org/statistics/quickfacts.cfm
Table 4.3: Differences Between Traditional Nonprofit Entrepreneurs and Enterprising Nonprofits
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Types of Social Entrepreneurship
Source: http://www.kauff man.org/blogs/growthology/2015/03/six-ways-non-profit-entrepreneurs-are-distinct-from-traditional-entrepreneurs
Table 4.4: Features of Venture Philanthropy
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Source: John, Rob, Venture Philanthropy: The Evolution of High Engagement Philanthropy in Europe. Skoll Centre for Social Entrepreneurship Working Paper: Oxford Said Business School, 2006.
See this table on page 98.
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Hybrid Models of Social Entrepreneurship
An organization with a purpose that equally emphasizes economic and social goals
Examples
VisionSpring
Sustainable Harvest
Better World Books
Types of Social Entrepreneurship
4.4 Capital Markets for Social Entrepreneurs
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Capital Markets for Social Entrepreneurs
Social Venture Capitalists
“Community” funds
Microfinance
Social Venture Capitalists (SVC)
Impact-investment funds looking to make a return on investment and make a social/environmental impact
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Capital Markets for Social Entrepreneurs
Source: “d.light reaches 50 millions lives empowered,” http://www.dlight.com/files/2614/3172/1502/50_Million_PDF_for_Website.pdf
Table 4.5: d.light Impact
Should social entrepreneurs be responsible for assessing the effects of their endeavors, or is it sufficient that they are making an effort to solve a social problem? Explain your answer.
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Table 4.6: Examples of Impact Investment Funds
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Source: http://www.impactbase.org/info/examples-impact-investment-funds
Table 4.6: Examples of Impact Investment Funds
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Source: http://www.impactbase.org/info/examples-impact-investment-funds
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Microfinance
Microloans: short-term, low amount
Examples:
Grameen Bank (founded by Muhammad Yunus)
Kiva
InVenture
Capital Markets for Social Entrepreneurs
4.5 Social Entrepreneurs and Their Stakeholders
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Employees
Volunteers
Investors
Customers
Suppliers
Manufacturers
Community leaders
Sponsors
Board members
Other entrepreneurs
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Who Are Stakeholders?
Social Entrepreneurs and Their Stakeholders
Building relationships with key stakeholders is an important way to gain support, but you must also prove to your key stakeholders how you intend to generate value for them. While “doing good deeds” is a worthy objective, your stakeholders will want to understand the value from being involved with the venture.
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Figure 4.3: Example of Stakeholder Map
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Figure 4.4: Jim Poss’s Stakeholders
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Source: Mitchell, R., Agle, B., & Wood, D. (1997). Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts. Academy of Management Review, 22, 853–866.
Figure 4.5: Mitchell Stakeholder Typology
Dormant
Discretionary
Demanding
Dominant
Dependent
Dangerous
Definitive
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Types of Stakeholders
Social Entrepreneurs and Their Stakeholders
Corporate social responsibility (CSR) describes the efforts taken by corporations to address the company's effects on environmental and social wellbeing in order to promote positive change. While social entrepreneurship may sound similar to the corporate social responsibility (CSR) model, they are not the same (see Table 4.7).
The difference lies in the primary objective. In essence, CSR adds social objectives while still pursuing the main goal of making a profit. In contrast, many social entrepreneurship models, including the hybrid model, place equal emphasis on social and economic goals. An organization with a CSR strategy could reduce spending on its CSR program if it is struggling to meet revenues, whereas a social enterprise would prioritize its social goals even in the face of a reduction in profits.
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4.6 Differences Between Social Entrepreneurship and Corporate Social Responsibility
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Corporate Social Responsibility (CSR)
The efforts taken by a corporation to address the company’s effects on environmental and social well-being in order to promote positive change.
Differences Between Social Entrepreneurship and Corporate Social Responsibility
Table 4.7: Corporate Social Responsibility Versus Social Entrepreneurship
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Figure 4.6: CSR Makes Good Business Sense
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Credit: R. Mitchell, B. Agle, and D. Wood, 1997. “Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts,” Academy of Management Review, 22 (4): 853–866.
4.7 Social Entrepreneurship and Global Inclusion
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Social Inclusion
Confronts inequity that creates marginalization
Creates opportunities
Breaks down social issues
Encourages hope
Example: Work Integration Social Enterprises (WISE)
Social Entrepreneurship and Global Inclusion
Many of us live in a “me-centered” world, where events and relationships are measured by how much, and in what ways, they affect us. Being “other-centered” means stepping outside ourselves, and shifting the focus onto serving others for the good of the greater community.
Srikumar Rao, “Moving from a ‘me’ to an ‘other-centered’ universe,’ Huffpost Healthy Living (April 14, 2010) http://www.huffingtonpost.com/srikumar-s-rao/how-to-be-happy-moving-fr_b_570730.html retrieved on October 30, 2015.
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Table 4.8: Resources for Social Entrepreneurs
Ashoka
Echoing Green
Envirolink
Global Social Venture Competition
Investor’s Circle
Lewis Institute
Net Impact
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Social Entrepreneurship and Global Inclusion
Root Cause
Schwab Foundation
Skoll Foundation
Social Edge
Social Enterprise Alliance
Social Fusion
Social Innovation Forum
Social Venture Network
William James Foundation
See details for each resource on page 113.
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Practice Being “Other-Centered”
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MINDSHIFT
MINDSHIFT: Practice Being “Other-Centered”
In this Mindshift, your challenge is to practice being “other- centered” for one week. Many of us live in a “me-centered” world, where events and relationships are measured by how much, and in what ways, they affect us. Being “other-centered” means stepping outside ourselves, and shifting the focus onto serving others for the good of the greater community.
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MINDSHIFT: Practice Being “Other-Centered”
For example, instead of getting frustrated at an older adult taking forever to put away her change at the checkout line, give her a reassuring smile, and maybe offer to help her with her bags of groceries. Think about different ways in which you can cheer up others. Make someone else’s day.
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1. To what extent do you feel you are already “other-centered” in your life? Give some examples of your actions and decisions in this regard.
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MINDSHIFT: CRITICAL THINKING
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2. Was it easier than you expected, or more difficult, to focus for an entire day on being other-centered? Would you want to continue this focus for a second day running?
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MINDSHIFT: CRITICAL THINKING
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3. What did you learn from this Mindshift that surprised you?
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MINDSHIFT: CRITICAL THINKING
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