PROF: DODIE D.

LAGARTO, JD, MBA

Course Code: GEESO2
Course Title: Entrepreneurial Mind
Credits: 3 units
Pre-Requisite: None
Section: Crim 21, 22, 23 & 24

Social Entrepreneurship

The future of social entrepreneurship is no longer about looking

up to a select few who have some kind of rare gift for
implementing innovative ideas. Every individual and
organization have a role to play in mobilizing skills, talents, and
life experiences to move towards a more just and equitable
world where all have what they need to survive and thrive in life.

– Oscar Auliq-Ice –
I: The Need for Social Entrepreneurship

According to the World Food Program, one in every nine people on the planet is hungry
or undernourished. Meanwhile, 1.9 billion adults are overweight or obese, one third of
food produced globally for human consumption goes to waste, and $4.6 billion is spent
annually on ads by the fast-food industry – a figure that could save each starving boy and
girl in the world, by a factor of four.

The World Health Organization reports that 2.3 billion people lack access to basic
sanitation facilities, such as toilets or latrines. Of course, the public health consequences
of open defecation are dire. Diarrhea alone kills one child every 17 seconds. (Nearly the
same amount of time it took you to read this paragraph.)

1.2 billion people lack access to safe drinking water, affecting four out of every ten people
in the world. And as the global population grows by 80 million per year, so too, does the
demand for freshwater – at an annual rate of 64 billion cubic meters. That’s equivalent to
50,000 Olympic-size swimming pools per week.

Meanwhile, today’s eight richest billionaires have the same combined wealth as does the
poorest half of humanity. In fact, 2017 saw the biggest increase in billionaires in history,
with one more added every two days.

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Together, they made over $462 billion. That’s enough money to end extreme poverty
around the globe – seven times over.

Finally, looming large is the mother of all crises: Climate change. For decades, scientists
have warned us about major environmental threats including global warming, animal
extinction, deforestation, desertification, water scarcity and extreme weather events like
floods, droughts, storms and wildfires. Already, irreversible changes to our ecosystems
are underway, and by the end of the century, we’ll be living with climate conditions
entirely new to our species.

Is this really the best we can do?

II: What Is Social Entrepreneurship?

The concept of social entrepreneurship (SE) is, in practice, recognized as encompassing a
wide range of activities: enterprising individuals devoted to making a difference; social
purpose business ventures dedicated to adding for-profit motivations to the nonprofit
sector; new types of philanthropists supporting venture capital-like ‘investment’
portfolios; and nonprofit organizations that are reinventing themselves by drawing on
lessons learned from the business world. In the past decade ‘social entrepreneurship’
has made a popular name for itself on the global scene as a ‘new phenomenon’ that is
reshaping the way we think about social value creation. Some of these practices are
uniquely new however many have been around for a long time having finally reached
critical mass under a widely endorsed label.
Across the globe, individuals and groups are applying innovative approaches to
addressing social problems that have not been satisfactorily addressed by the public or
private sectors. This is called social innovation.
In search of new solutions, a growing number of social entrepreneurs are developing
novel strategies to achieve social impact. Pearce & Kay assert that social entrepreneurship
“is about a different way of doing things, based on shared values. It is about a vision of
the way people and organizations might work together for the common good, where
private gain is tempered always by consideration for the needs of people and the planet”

There are different types of entrepreneurs who focus on solving a variety of problems in
the marketplace. Social entrepreneurs are one type of entrepreneur who works to
improve social outcomes for individuals all over the world. In this article, we explain
what social entrepreneurship is, list the benefits of social entrepreneurship, describe how
to perform social entrepreneurship and offer examples of social entrepreneurship in
practice.

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Social entrepreneurship is the development of a business or organization focused on
improving social outcomes for a specific group of people. Social entrepreneurship differs
from more traditional types of entrepreneurships in a couple of important ways:
• Focus: A traditional entrepreneur often looks for a gap in the market and creates
a business that meets consumer needs. A social entrepreneur, by contrast, looks
for a social need they can improve or repair, and they create a business or structure
that supports that specific community.
• Goal: In traditional entrepreneurship, the goal is usually to make a profit. In social
entrepreneurship, the primary goal is to help cure a social ill.

III: Social Entrepreneurship Define.

There are no concrete and precise definition of what social entrepreneurship is, many
people give their own definition, this are some of the definitions given:

‘Social entrepreneurship is innovative, social value creating activity that

can occur within or across the nonprofit, business, and public sectors’

‘…a quite general working definition of social entrepreneurship: a set of

institutional practices combining the pursuit of financial objectives
with the pursuit and promotion of substantive and terminal values.’

‘…social entrepreneurs are change promoters in society; they pioneer

innovation within the social sector through the entrepreneurial quality
of a breaking idea, their capacity building aptitude, and their ability to
concretely demonstrate the quality of the idea and to measure social
impacts.’

‘We define Social Entrepreneurship as a dynamic process created and

managed by an individual or team (the innovative social entrepreneur),
which strives to exploit social innovation with an entrepreneurial
mindset and a strong need for achievement, in order to create new
social value in the market and community at large.’

‘…I define social entrepreneurship as a process that includes: the

identification of a specific social problem and a specific solution… to
address it; the evaluation of the social impact, the business model and
the sustainability of the venture; and the creation of a social mission-

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 oriented for-profit or a business-oriented nonprofit entity that pursues
the double (or triple) bottom line.’

‘…we define social entrepreneurship as the innovative use of resource

combinations to pursue opportunities aiming at the creation of
organizations and/or practices that yield and sustain social benefits.’

‘Social purpose business ventures are hybrid enterprises straddling the

boundary between the for-profit business world and social mission-
driven public and nonprofit organizations. Thus, they do not fit
completely in either sphere.’

‘TSVs [technology social ventures]… develop and deploy technology-

driven solutions to address social needs in a financially sustainable
manner… TSVs address the twin cornerstones of social
entrepreneurship – ownership (financial return) and mission (social
impact) using advanced technology.’

‘Social enterprise is a collective term for a range of organizations that

trade for a social purpose. They adopt one of a variety of different legal
formats but have in common the principles of pursuing business-led
solutions to achieve social aims, and the reinvestment of surplus for
community benefit. Their objectives focus on socially desired,
nonfinancial goals and their outcomes are the nonfinancial measures of
the implied demand for and supply of services.’

The Schwab Foundation [source of the study population] defines a social

entrepreneur as someone who [among other things]: ‘identifies and
applies practical solutions to social problems…; innovates by finding a
new product, service or approach…; focuses… on social value creation
…; resists being trapped by the constraints of ideology or discipline;
[and] has a vision, but also a well-thought out roadmap as to how to
attain the goal.’

The emerging excitement surrounding the topic of SE is evident in the large number of
definitions that are currently used to describe the phenomenon. This is also reflected by
the variety of definitions present in this volume.

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The proliferation of definitions, and also different naming conventions, mirrors the
multiple facets of the phenomenon. Narrowing SE down to a uniformly agreed upon
definition would probably make it applicable only to a limited set of problems and issues.
As Albert Cho points out, restrictive definitions at this early
stage seem to cause more problems than they solve, ‘not least because the research
community continues to explore new forms and avenues for SE.

The core definition

Social entrepreneurship is innovative, social value creating activity

that can occur within or across the nonprofit, business, and public
sectors. (Austin, Stevenson and Wei-Skillern, 2006)

The first key element to stress is innovation. Entrepreneurship is a creative process that
pursues an opportunity to produce something new. Replicating an existing organization,
activity, or process is an important managerial activity, but unless it brings an important
new dimension or element, it is not very entrepreneurial. The second key element is social
value creation. This is the fundamental dimension differentiating SE from commercial
entrepreneurship (Austin, Stevenson and Wei-Skillern, 2006). While both forms are
socially valuable, generating social value is the explicit, central driving purpose and force
for SE. The third key dimension is the loci. SE transcends sectors and organizational form.
It can occur in all the sectors and their collaborative interactions.

IV: Antecedents and development of the field

In many ways, SE as a field of study is in startup mode. The creation of a new field of
study is exciting work and to that end, there have been prelaunch activities. For example,
some of the elements of what we call the field of SE research were acquired from studies
of nonprofit leadership and management and the research being conducted at the
intersection of social issues (including environmental issues) and management. Some of
the studies on the nonprofit sector examined how business-like practices were being used
to achieve their noteworthy objectives. Other studies focused on the revenue generating
strategies of nonprofit organizations. Studies categorized as social issues management
focused on the efforts of large multinational corporations and their corporate social
responsibility programs and performance. None of these antecedents however discussed
the creation of new organizations.
The extensive literature on entrepreneurship has only recently embraced the idea that
entrepreneurial actors may be driven by more than a profit motive. Some scholars have
discussed the role of entrepreneurship in economic development. In our mind, all of these
efforts are the primordial soup out of which scholarship about SE has risen.

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V: Basic criteria of social entrepreneurship
Social entrepreneurship is driven by the desire to help create a better community, society
or world rather than serve a capitalistic market. Depending on the structure of social
entrepreneurship and how it funds its products or services, profit may be a secondary
goal, but it's rarely the primary driving force for the endeavor overall.
In most cases, an entrepreneurial endeavor should meet these criteria to be considered
social entrepreneurship specifically:
• Cause: First, the social entrepreneur must identify a social cause that leads to
inequality for a marginalized group with little to no resources to act on their own
behalf.
• Opportunity: Next, the social entrepreneur must see an opportunity or way to
improve equality for this group.
• Solution: Finally, the social entrepreneur must have the ability to provide a
solution to the group to improve their lives.
Benefits of social entrepreneurship
Social entrepreneurship offers a number of advantages to the entrepreneur themselves,
to the group the entrepreneur serves and the social community at large. Consider a few
of the most impressive benefits of engaging in social entrepreneurship:
Inspiration
As a social entrepreneur, you have the opportunity to not just create change in the
marketplace or for a specific group of people, but to serve as a source of inspiration for
other entrepreneurs, customers and change-makers.
Response
The products and services created by social entrepreneurs fill a vital need in the
marketplace. While many entrepreneurs fill a gap in the consumer marketplace, social
entrepreneurs provide an often desperately needed service or product to a marginalized
group of people.
Relationships
Social entrepreneurs have the benefit of building relationships with business-minded
administrators and socially focused change makers. Since social entrepreneurship
combines business with social change, you have the opportunity to work with a
multitude of people.

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Value
Your business or endeavor will likely bring both social and economic value to the
marketplace. Often, governmental organizations oversee social programs. If you start a
socially-minded endeavor outside of governmental oversight, then you'll probably be
able to enact change more quickly and more efficiently than going through the
government, bringing real value to the marketplace.
Improvement
Not every company considers the societal impact of their company when they run their
business. However, since social entrepreneurship actively seeks to improve a segment of
a society, your organization can greatly improve your community in a way that purely
profit-minded companies might not.
Leadership
As a social entrepreneur, you are the leader of your organization and get to choose how
to run your company. You set the guidelines and are the primary model for how your
employees should work within your organization.
Job creation
When you start a new business endeavor, you create jobs. As a social entrepreneur, you're
not only providing jobs through your company but also providing value and resources
to the community you're actively serving.
Positivity
Companies built around improving their local or global communities are often founts of
positivity. Having a reputation as a business that does good in the world and focuses on
helping others can help you woo investors and maintain goodwill with consumers.
How to perform social entrepreneurship
If you're interested in starting a social entrepreneurship, follow these steps to help you
get started:
1. Identify your passion
Before you can start a social entrepreneurship, you must find a cause you truly care about.
Passion, in this specific entrepreneurial case, is vital. Establishing a brand new business
takes patience and time, and sometimes even more so on the social side of
entrepreneurship.

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2. Research the arena
Once you've identified a cause you want to support through your business, research the
field to see if there are any other organizations in the marketplace or if there are other
companies you might seek guidance from when structuring your business.
3. Write a mission statement
After you've researched your desired cause and have a good idea of what you want to do
and how you want to do it, write a clear and comprehensive mission statement to help
guide the formation of your company. Ideally, your mission statement will answer these
questions:
• What will my organization do?
• How will my organization meet our goals?
• Who is my organization serving?
• What value will my organization provide?

4. Establish your team

Build your team based on the values and practices established in your mission statement.
You may begin the venture with a business partner or other stakeholders, but as you start
to actually move towards engagement with your target market, hire employees who will
help you meet your goals.
5. Make a business model
Work with your team to create a business model. Often, business models are thorough
road maps that describe how exactly your company will meet the goals and provide the
value outlined in your mission statement. Often, business models also outline how you
intend to fund your operations.
6. Start small
Get your organization running by starting production on a small scale or offering a
limited number of services. Don't feel you must immediately solve the problem you've
set out to address right away. Instead, do what you can with the resources you have at
first.
7. Be adaptive
Understand that innovation and adaptation are an integral part of any entrepreneurial
venture, social or otherwise. Adapt your practices and strategies as needed to continue
working towards your long-term goals and bringing value to the marketplace.

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8. Seek support
Many social entrepreneurs fund their operations in part through investors or donors.
Look for capital from businesses and from philanthropists to help you build your
business and continue to grow.
9. Scale up
Broaden your business over time, expanding your operations as you have the funding,
labor and resources to do so. Scaling up can take years, but doing so slowly and
deliberately can help ensure your company's viability in the marketplace.
Examples of social entrepreneurship
Social entrepreneurship can take a multitude of forms. Consider a few examples of social
entrepreneurship in action to see how you might structure your own socially-minded
venture:
• Crowdfunding: You can start a business that helps disadvantaged people or
groups raise money for their specific needs.
• Cooking: You can cook or bake to raise money for those who need support.
• Technology: You can develop technology or tools to help those in marginalized
groups meet their needs.
• Travel: You can start an organization that helps interested people travel to
different destinations for educational purposes.
• Employment: You can help disadvantaged or marginalized groups learn about
the employment market and help them find jobs.
• Promoting: You can help artisans sell their wares through an online or in-person
platform they may not have access to independently.
• Lending: You can lend money to budding entrepreneurs in disadvantaged sectors
to help them create their own businesses.
• Housing: You can build housing for those in need.
• Mentoring: You can offer mentoring services to individuals or groups who could
use it to improve their businesses or skills.

• Diversifying: You can promote diversity and educate others on the value of
diversity in a variety of settings like schools and companies.
• Supporting: You can establish a collective marketplace in which people lacking
business resources can share their skills or products.

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