Social Entrepreneurship

Out of curiosity and my interest in social entrepreneurship, I completed an online course on ‘social entrepreneurship’ offered through HP LIFE (Learning Initiative for Entrepreneurs) e-Learning platform. Here is the summary of my learnings from the course: 

Social entrepreneurship: 

• Social entrepreneurship uses innovative, market based solutions to address social and environmental problems
• A social enterprise exists primarily to provide a solution to a social or environmental problem, and must use a business approach that works financially
• Social enterprises are not the same as businesses focused on the use of social media and are not the same companies that only make philanthropic donations or organize volunteering and other community engagement initiatives

Some key principles that define the way social enterprises operate; a social enterprise… 

• Has a clear social and/or environmental mission as its core purpose
  - What problem in the community is your social enterprise trying to solve? 
  - Who is your social enterprise aiming to help? 
  - How will your social enterprise’s product or service solve this problem?
  
  
• Generates most if its income through selling products or services, not through charity
  - Social enterprises develop innovative business models that respond to under-served needs, ensuring that goods and services are affordable and accessible to those who need it most 
  - Early stage social enterprises may benefit from grant funding to help launch or scale their business, but they derive most of their income by operating in the local economy to buy and sell goods and services
  
  
• Reinvests the majority of its profits in order to achieve its social and/or environmental mission 
  
  
• Assesses its social and environmental impacts across all stages of business process
  - Have to measure and manage their financial impact through their financial statements 
  - Measure the social impact that is being achieved by their efforts 

Some common mistakes to avoid as you set up a social enterprise: 

• Developing a product or service without a good understanding of the social issue
  - This often results in only addressing the symptoms of a problem, not the root causes 
  - Product or service should be relevant to your target audience 
  - Should be priced appropriately, designed in a way that takes into account the local culture and practices

• Neglecting finances in pursuit of the social mission
  - Enterprises need to remain financially sound

• Ignoring products/services that already address this social issue in your community
  - Make sure that your offering addresses an under-served need 
  - Find ways to collaborate with and complement the work of other solution providers wherever possible

Few examples of social enterprises:

1. Riders for Health:

- Works to prevent the spread of disease

- Revenue is generated through contracts with local health departments, NGOs etc. and fundraising

2. Weaver's Hut: 

- Teaches life skills and provides a forum for weavers to sell their products at higher profit

- Sells weaver's products, taking a small share of the proceeds while still giving the weavers a higher profit

3. First Book:

- Provides access to educational environment for low income children (0-18 age group)

- Gives educators access to new resources at lower prices and gives publishers access to new market

If you would like to know more, 'Entrepreneurship Notes' has a series of blog posts based on my learnings about entrepreneurship, social entrepreneurship and more! To read, visit: Entrepreneurship Notes