First Euro-MENA on Social and Solidarity

Economy Forum in Granada

10 -11 November 2011

Exhibition Centre Messe Wien, Austria

Social Economy: Innovative Experiences and Solutions

for Unemployment and Poverty Eradication
Dr. Atef El-Shabrawy
World Bank advisor to the Egyptian government ex advisor
Professor of Innovation and Entrepreneurship, Egyptian-Japanese University for Technology –University Senghor, Arabian Gulf University – Bahrain
www.socialinnovationexpert.com
Atef.alshabrawy@gmail.com 1
 The story of business for good

• Produced cosmetics from plants

& natural ingredients
• Marketed low-cost products,
• Provided consumer education,
• Employed disfavored people
(mainly women)
• Carried out human and social
activity
• Achieved a fortune of more than
$16 billion, making Anita
Ruddick one of the richest
women in UK Its story started in 1976, with Anita Roddick, the founder, opening a little green shop in Brighton with a belief in
something revolutionary: that business could be a force for good.
Anita Perilla is from an immigrant family from Latin America. She participated in trips to “hippie” groups and
learned about the cultures of the world and the rituals and customs of its people, in health care and body care.
She began working from home, then Anita Roddick opened her first store, in order to produce cosmetics from
plants and natural ingredients. She took advantage of her customers’ interest in preserving the environment,
marketed low-cost products, and provided consumer education and social activity. She started with a loan of
6,500 British pounds in 1977 and contracted with a local herbal nursery to supply all natural cosmetics. She
opened her first store and called it “The Body Shop.” She achieved a fortune of more than $16 billion, making
Anita Ruddick one of the richest women in England.

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Why social solidarity and economy are
interested by the Unemployment and Poverty
Eradication?

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“Most recently…capitalism has been
characterized by ‘excess’ …It has been
associated with high unemployment, rising
social tensions, and growing political
disillusion…So the big question is: how can Christine Lagarde, President
we restore and sustain trust? “ European central Bank, Ex
Managing Director, IMF,

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Poverty Eradication has still a long way ahead..

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Shifting From Profit To Purpose: Why
social solidarity and economy are
becoming the choice for entrepreneurs?

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From Money-maker To Purpose (Change-maker)

Jessica Jackley

to take advantage of to develop industry & “Tech entrepreneur." “Social entrepreneur." “Social Tech-
raw materials capital markets entrepreneur."
Elements of creating a Business

Business with purpose (the new

normal)
Forces shaping the MIND OF Entrepreneurs

Strategic
Positioning
Environment Resources
Action
Ability &
Opportunity
Commitment
Recognition
To change

Values
 “The reasonable man adapts
himself to the world, the
unreasonable one persists in
trying to adapt the world to
himself. Therefore, all progress
depends on the unreasonable
man.”
John Elkington
The change in Entrepreneurship Spectrum
Non-profit For-profit

Traditional Entrepreneurs
Social Entrepreneurs

Conscious
Charity business

Mission Growth Profit Growth

Dependency Self-Sufficiency Sustainability

The new message: You can make profit and impact on the community
 A Spectrum Of Solidarity, Social And Shared
Economy
Solidarity Economy
What is about.. Formal and informal initiatives,
grassroots or community
based organizations
Transforms economies and
What is the purpose? societies for more solidarity,
social inclusion, social
justices, could be part of a
broader political agenda
Yes, many entities may be considered as both
What is the overlap?
Social Economy
Formal entities: associations,
cooperatives, foundations,
mutuals, social enterprises,
other country-specific forms
Driven by common principles:
• Primacy of people over
capital
• Democratic and/or
participatory governance
• Reinvestment of profits to
benefits its members or
society at large
Social
Entrepreneurship Shared Economy
A broader process to create
An economic model defined
as a peer-to-peer based
new social value in the social
activity of acquiring,
economy as well as the public
providing, or sharing access
and private sectors based on
to goods and services, often
innovation
by an online platform.
Creates and scales up activities
with a social and/or
Allow individuals and groups
environmental focus
(mainly middle class) to make
money from underused assets.
Social business & Startup
 A Spectrum of Capital for any business
Financial-only Responsible Sustainable Impact Impact –only

Delivering competitive financial returns

Mitigating social, environmental, and governance risks
Pursuing social, environmental, and governance opportunities
Focusing on measurable high-impact solutions
competitive financial return
Below market financial return
Adopt address
Mitigate risky address address address societal,
Investment profile

Limited or no progressive societal,

social, societal, societal, challenges, that
regard for social, social, challenges,
environmental, challenges, challenges, can’t generate a
environmental, environmental, generate
and governance which may that require financial return
and governance and governance competitive
practices in order generate a below market for investors
practices practices that financial return
to protect value below market financial
may enhance for investors
value financial return return for
for investors investors
 Innovative Experiences and Solutions for Unemployment and Poverty
Eradication

Social business & Startup Solidarity Economy Social Economy Shared Economy
Boost the access to
finance for the poor

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Shareholders
Capital : Government + CSR from Private Banks + An NGO

Targeted groups
Needy Families/home-based business/unemployed/NGO’s & Charity funds/students/ PWDs

Mohammed bin Rashid Award for best Arab

Bank For SME in Arab world, 2013 16
The biggest Cooperative Bank in the world

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 Grameen Bank established 42 companies
Muhammad Yunus launched
Grameen Bank – “the bank
for the poor” in 1976, and
essentially started the
microcredit revolution.
For over 40 years, he’s
demonstrated the power of
business solutions to tackle
underlying causes of poverty,
by providing small loans and
banking opportunities to small
business operators around
the globe without requiring
collateral.
Loans dispersed amount to
$24 billion, among 9 million
borrowers.

Solidarity Economy18
Grameen Bank established 42 companies
1. Grameen Krishi Foundation: To improve the irrigation system and support agricultural supplies for small farmers at
affordable prices.
2. Grameen Uddog: To revive the handloom industry and manage it in a modern, export-oriented way,
3. Grameen Motsho Foundation: To work on the production, transportation, storage and marketing of fish and fish
farms
4. Grameen Fund: To contribute to companies working in the fields of information technology, communications, and
bioengineering ،
5. Grameen Kalyan : To provide financial support for employee projects and investments.
6. Grameen Shamogree: To market inside and outside Bangladesh for all national products and labor-intensive rural
industries, and to establish and support industries in cooperation with people or organizations
7. Grameen Telecom: To introduce mobile phone service to serve 100 million residents of 68,000 villages in Bangladesh
8. Grameen Shakti: It works in the field of rural energy, and aims to spread renewable energy sources in rural homes.
9. Grameen Cybernet Ltd : It works in the field of fast and cheap internet for a small sum

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Grameen creative Lab creates Social Fundsc
Grameen Creative Lab helps creating social business funds

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Boost the access to
market

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 BANGLANATAK dot.com Rural Craft and Cultural Hub (RCCH)
• BANGLANATAK dot com is a social enterprise working across India with a
mission to foster pro-poor growth and protect women, children and indigenous
communities.
• It uses theatre, and developing community-led creative industries based on
intangible cultural heritage like performing arts and crafts.
• Example of the art of PATTACHITRA (Kolkata, India) painting was a
movement in the lives of artists who created social and economic change in their
villages by making the form a tool of empowerment.
• More than 100 household are engaged fully or partly in Patachitra Art,
celebrating several annual national and international Heritage festivals.

Social foundation
The messages through Pattachitra not only depicted by the scroll painting, but it
also accompanied with the pater-song by the patuas. All these make pattachitr
pattachitra a unique characteristic to attract the tourists
 NGO establishing a Value-Chain in
livestock
Example of animal value chain model for empowering 640 poor women,
beneficiary of cash-transfer social assistant, by a local NGO, funded by
Ministry of social Solidarity.
Each women got a battery equipped to raise 120 chickens in a small space
at home, producing 60,000 to 80,000 eggs daily..
 Youth social organizations for societal challenges in
Qatar
Ministry of Culture, Youth and Sports,
and the Qatar Business Academy,
established a three-month initiative
included training courses, a social
innovation lab, a business plan
competition, and a prize by the ministry,
with the aim of designing social
companies that solve the problems of
youth in Qatar.
Creating three organizations targeting :
• Recruitment advisory
• Family advisory
• Youth health and obesity center

Solidarity Economy
In the year 2005, the four founders of the
company started Etsy, a social enterprise-
online marketplace for handmade
goods, a virtual storefront for arts and
crafts, with the vision to help the craftsmen
sell their goods on an online platform. The
company has raised a total amount of $97.3
million in funding over nine rounds. The
latest funding round took place on May 15,
2017.
Today the company is an artisanal
marketplace, with 400,000 crafters, who
made Etsy a hot start-up: profitable, well
capitalized, growing.

Social business & Startup

Boost the access to
jobs
 Glowork, a recruitment agency empowering Saudi women into workforce
• For many Saudi women, full participation in the workforce was a challenge despite
that more than 60 % of university students are women. At 2010, less than 15% of the
Saudi labor market made up of women, 78 % of unemployed women are university
graduates, highly qualified ( study by Booz &amp 2010).
• Glowork, the first dedicated organization for women employment throughout the
Middle East, was established in 2011 by Khalid Alkhudair (28 years of age then), who
gave up his comfortable job as an auditor at KPMG at the time to create a recruitment
company for Saudi women.
• Glowork is a real success, having helped around 36,000 Saudi women find direct jobs
across the country until 2015.
• End of 2015 Glowork,, reported its acquisition by Saudi holding company SAS Holding,
with estimated amount SR60 million ($16 million), gives the new owner the majority
share of 51% and the remaining equity is broken down to its current founders Khalid
Alkhudair and two cofounders.
Social business & Startup
Co-Op Ride, the largest worker-owned cooperative in US

• A ridesharing company and mobile app, owned collectively by the

drivers, launched in May 2020 in New York City, with 2,500
drivers.
• With 6,000 members it is the largest worker-owned cooperative in
US
• Co-founded by an immigrant, two drivers and former Uber
executive
• It takes 15% from each ride as overhead (instead 25% to 40% by
Uber)
• Stared with seed money from the Minnesota-based Community
Development Financial, Shared Capital Cooperative, individual
donations via crowdfunding (revenue sharing debt on Wefunder)
• More than 90% of drivers are immigrants who don’t have a history
of credit, or stuck in predatory financing situations,
• It set aside 10% of profits to community foundations and non-
profits .

Shared Economy
 SWVL… daily commute of middle class people
• SWVL, Dubai-based, originally Egyptian, provider of tech-enabled mass
transit solutions, to facilitate the daily commute of middle class
Egyptians. The bus transportation network aims at reinventing urban
mass transit by providing buses to every part of Egypt.
• High Quality meets Low Prices SWVL provides comfortable seats and
transportation conditions at 50% to 80% cheaper prices than the rest of
on-demand services.
• SWVL operates in 135 cities in 20 countries across Latin America,
Europe, Africa and Asia.
• In the go-go market of 2021, SWVL bought operators in Europe and
South America, expanding from a base in the Middle East. The SPAC was
worth $1.5 billion when it was launched, delivering a private investment
in public equity (PIPE) of $121.5 million. After the initial public offering
(IPO), the company continued to grow for several months, signing a deal
to use its software.
• The company went public in March 2022 and is traded on the Nasdaq
stock exchange under the ticker SWVL
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Challenges
• Access to fund
• Not satisfying the need Challenges faced by social business & startups
• Access to markets
• Weak business eco-system
• Inadequate regulations (incentives)
• Access to talent
Being generous is a mood-booster!!
Sonja asked students to carry out five weekly "random
acts of kindness" of their choice, anything from buying a
Big Mac for a homeless to helping a brother with
schoolwork..
The students reported higher levels of happiness than a
control group, with students who performed all five
kind acts in one day reaping the biggest rewards by the
end of the six-week study period.
Sonja Lyubomirsky
Stanford University psychologist