UNIT 3 (ENTREPRENEURSHIP)
What is Social Entrepreneurship?
Social entrepreneurship is all about recognizing the social problems and achieving a social change by
employing entrepreneurial principles, processes and operations. It is all about making a research to
completely define a particular social problem and then organizing, creating and managing a social venture
to attain the desired change. The change may or may not include a thorough elimination of a social
problem. It may be a lifetime process focusing on the improvement of the existing circumstances.
While a general and common business entrepreneurship means taking a lead to open up a new business or
diversifying the existing business, social entrepreneurship mainly focuses on creating social capital without
measuring the performance in profit or return in monetary terms. The entrepreneurs in this field are
associated with non-profit organizations. But this does not eliminate the need of making profit. After all
entrepreneurs need capital to carry on with the process and bring a positive change in the society.
Along with social problems, social entrepreneurship also focuses on environmental problems. Child Rights
foundations, plants for treatment of waste products and women empowerment foundations are few
examples of social ventures. Social entrepreneurs can be those individuals who are associated with non-
profit and non-government organizations that raise funds through community events and activities.
In the modern world, there are several well-known social entrepreneurs who have contributed a lot
towards the society. The founder and manager of Grameen Bank, Muhammad Yunus is a contemporary
social entrepreneur who has been awarded a Nobel Peace Prize for his venture in the year 2006. The
venture has been continuously growing and benefiting a large section of the society.
Rang De is another brilliant example of a non-profit social enterprise. Established in the year 2008 by
Ramakrishna and Smita Ram, it is an online platform from where rural and urban poor people in India can
access micro-credits with an interest rate of as low as 2 percent per annum. Lenders from all across the
country can directly lend money to borrowers, track investments and receive regular payments online.
The George Foundation is one more nationally recognized social enterprise. The Women’s Empowerment
Program creates awareness among women by providing them education, vocational training, cooperative
farming, business development and savings planning. By employing the principles of social
entrepreneurship, these organizations are addressing the social problems and bringing a positive change in
the society.
There are several other organizations that are considered as a positive changemakers in the
society. Echoing Green, The Canadian Social Entrepreneurship Foundation, Schwab Foundation for Social
Entrepreneurship, The Skoll Foundation, NIKA Water Company, Newman’s Own and Ashoka: Innovators
for the Public are such organization that aim for bringing social change and continuously improving the
existing conditions in the society.
The field of social entrepreneurship is rapidly growing and attracting the attention of numerous volunteers.
It has now become a common term in university campuses. The reason behind the increasing popularity of
this product is that individuals get to do what they have been thinking for long. The extraordinary people
put their brilliant ideas and bring a change in society against all odds.
Historical examples of leading social entrepreneurs across the world:
(i) Florence Nightingale (United Kingdom (UK) :
Founder of the modem nursing, she established the first school for nurses and fought to improve hospital
conditions.
(ii) Margaret Sanger (United States (US) :
Founder of Planned Parenthood Federation of America, she led the movement for family planning efforts
around the world.
(iii) Robert Owen:
Founder of the cooperative movement.
(iv) Vinobha Bhave (India):
Founder and leader of the Land Gift Movement, he caused the redistribution of more than 7,000,000 acres
of land to aid India’s untouchables and landless.
(v) Satyan Mishra (India):
Founder and CEO of the Indian Company, ‘Drishtee’, with it’s over 4,200 Drishtee-trained entrepreneurs
provides economic opportunities to the poor by facilitating access, generating employment and delivering
essential services in an affordable way. In this way, Drishtee is enhancing access and empowering rural
communities by creating significant cost and time savings to sell a range of products and services.
(vi) Bunker Roy:
Created the Barefoot College in Rural India to train illiterate and semi-literate men and women.
(vii) Muhammad Yunus (Bangladesh):
Founder of Bangladesh’s Grameen Bank and recipient of the 2006 Nobel peace prize, he began offering
micro loans to impoverished people in Bangladesh in 1976 and his model has now been replicated around
the world.
(viii) Dr. Maria Montessori (Italy):
Developed the Montessori approach to early childhood education.
Characteristics of Social Entrepreneurs
1. Curiosity
Social entrepreneurs must nurture a sense of curiosity about people and the problems they face. The best
social entrepreneurs seek to truly understand the needs and desires of the people they serve. Great social
ventures often start through immersive market research, an empathy-centric process through which social
entrepreneurs gain knowledge in the field.
Example: The founders of Shakti Apparel launched their venture after working with villagers in rural India
and learning about their lifestyles.
2. Inspiration
In order to design effective solutions, social entrepreneurs must be inspired by the people and problems
they encounter. Inspiration motivates action and helps social entrepreneurs tackle challenges that others
shy away from addressing.
Example: When he learned that his blind friend had no way to tell time, the founder of Eone set out on
a mission to design an effective solution to his friend’s problem.
3. Resourcefulness
In the world of social entrepreneurship, key resources, such as human and financial capital, can often be
scarce. Successful social entrepreneurs know how to leverage the resources at their disposal and develop
innovative methods to overcome obstacles.
Example: When he needed capital, the founder of Paka Apparel held an Alpaca petting zoo at a well-known
restaurant/bar to raise early-stage funds for his venture.
4. Pragmatism
Changing the world takes time, effort, and experimentation. While visions for massive social change may
provide their inspiration, experienced social entrepreneurs know that they need to take small steps in
pursuit of their goals. Great social ventures are not born overnight!
Example: The founder of Be As You Wear is working to reform systems that put youth at risk by taking
small steps, such as performing small-group education interventions and selling hoodies to fund her work.
5. Adaptability
Social entrepreneurs must remain open to solutions. This includes knowing when to pivot and change their
strategies if their initial methods do not succeed. Adaptability and flexibility are integral in the
development of early-stage social enterprises.
Example: Salty Girl initially was going to create a platform linking fisheries to chefs, but they pivoted to
selling sustainable, traceable fish directly to consumers.
6. Openness to Collaboration
While embarking on a quest to change the world may feel lonely, it is important to remember that social
entrepreneurship is a team sport, and other people are willing to help. Social entrepreneurs need to stay
open and attentive to potential partnership and collaboration opportunities. In many cases, collaborative
initiatives and joint-ventures can achieve social/business goals much more effectively than solo endeavors.
Example: Refugee Investment Network partnered with Village Capital to offer an investment-readiness
tool designed for refugee entrepreneurs.
7. Persistance
Social entrepreneurs take on some of the most daunting challenges our society has to offer. This often
creates a recipe for early-stage failures. However, the successful social entrepreneurs are the ones who
persist past initial setbacks and persevere to deliver effective solutions. Experienced social entrepreneurs
know how to learn from failures, adjust their methods, and make continual strategic improvements. Don’t
give up if at first you don’t succeed!
Example: Kapamagogopa Incorporated (KI) overcomes obstacles to bring peace to communities in the
Philippines
Need of Social Entrepreneur
1. They draw attention to a pressing problem: Social initiators—another word for social
entrepreneurs—improve the lives of citizens by highlighting pressing problems that might plague a
neighborhood, country, or group of people.
2. They create economic value: By creating jobs, producing income, and nurturing an entire network
of business partners—suppliers, shipping companies, lenders, and utility companies—social
entrepreneurs contribute to the economic renewal of the region or country where they live and
operate. Add to that the multiplier effect, in which employees of socially oriented organizations
also have the opportunity to spend their income and grow the local economy.
3. They act as catalysts for social change: Muhammad Yunus, the founder of Bangladesh-based
Grameen Bank, epitomizes the ability of social entrepreneurs to spearhead positive change not only
locally, but also globally. The Grameen Bank has received plaudits for promoting microfinance and
microcredit, lifting millions of underprivileged customers out of poverty by funding local projects at
favorable conditions.
4. They generate social value: “Social value” is the general improvement you see in a society, typically
across the board. In addition to impact on people, other advantageous influences include
sustainable environmental practices, high literacy for the underprivileged, a free flow of
information among citizens, reduced health hazards, and increased innovation from educated and
healthy citizens.
5. They inspire others: Social initiators inspire others to do good, and sometimes great, things—
simple as that. Their ability to espouse great ideas and bring others on board serves as a powerful
catalyst to create a virtuous circle. In addition to well-known social entrepreneurs like Bill Gates,
there are lesser-known but also effective social entrepreneurs who bring about change every day in
the communities where they live and work.
6. They can influence government policy: All around the world, movements inspired or spearheaded
by social initiators have gathered strong popular support, which in turn has helped the political
willpower needed to make fundamental changes. Whether it is in public health, environmental
awareness, occupational safety, or education, socially oriented initiatives have transformed the way
we live, work, and vote on the fundamental issues of the day.
7. They create unique opportunities: Social entrepreneurs, by their very actions and initiatives, can
provide unique opportunities for millions of individuals around the world. For example, Sam
Goldman and Ned Tozun created d.light to provide portable solar lamps to the world’s 2.5 billion
people who don’t have access to reliable electricity. In lieu of dangerous and dirty kerosene lamps,
d.light provides users with solar lamps that are clean and can emit light for up to 12 hours.
8. They reshape corporate social responsibility: Corporate social responsibility (CSR) has gained
momentum in the business world recently, but some social entrepreneurs want to make sure
companies don’t use CSR simply as a public relations ploy. The concern for real and sustainable CSR
has prompted Jay Coen Gilbert, Bart Houlahan, and Andrew Kassoy to launch B Lab, which certifies
businesses complying with a variety of social and environmental criteria, emphasizing things like
financial transparency, employee ownership, and Fair Trade certification.
9. They can change people’s behaviors: In their quest for a better world, social initiators often come
up with simple and easy-to-implement solutions that change or improve people’s behaviors. Daniel
Yates, for example, has created Opower to help people reduce their energy consumption by
allowing customers to easily compare their electricity and gas consumption with their neighbors’
consumption and then providing them energy-saving advice.
10. They save lives: Perhaps the most noteworthy impact of social entrepreneurs is their ability to
literally save lives. Jane Chen’s global initiative, Embrace, has received accolades for creating the
Embrace Warmer, a device that keeps low-birth-weight babies warm even when there is a power
outage in hospitals and clinics. Looking like a miniature sleeping bag, the Embrace Warmer provides
a lifesaving four to six hours of heat on a single 30-minute charge.
Types of Social Entrepreneurship
Community Social Entrepreneur
Community social entrepreneurs are modest contributors who target their immediate communities and
aim to solve their problems. They focus on various issues such as sanitation, education, literacy, food,
hygiene, health, employment, etc. They are located in small geographical areas with big visions and a team
that believes in their goals.
Once they achieve successful results in their communities, they try to expand and reach other
communities, paving the way for becoming a bigger social enterprise. Many large-scale social enterprises
begin as community social entrepreneurship.
Non-Profit Social Entrepreneur
Non-profit social entrepreneurs are more driven by social gain rather than financial gain. They start with
the initial cost, and when the business is set up and generates profits, they reinvest the surplus into the
cause. This helps them expand their vision and portfolio, allowing them to gradually grow into a bigger
social enterprise and solve bigger problems.
For example, let’s assume the initial vision of a social enterprise was to provide free basic healthcare to
those in need. As they grow, they put the surplus back and expand their vision to include those in need to
get costly surgical procedures.
Generally speaking, big-budget organizations and successful business people choose this model because it
is easier for them to generate enough profits to expand.
Transformational Social Entrepreneur
Transformational entrepreneurship is usually the next stage of non-profit social entrepreneurship. These
entrepreneurs target the social needs and problems typically outside the scope of other businesses or
governments. Moreover, they are focused on creating a greater social impact while also generating greater
economic benefits for the organizations.
These are large-scale organizations with their own set of rules and regulations. In some cases, they grow
big enough to collaborate with or integrate into government bodies focused on solving social problems.
Transformational social enterprises have better access to the top talent because of their size and budget.
They also recruit people and provide them with in-house training and mentorship to meet the
organization’s talent requirements.
Global Social Entrepreneur
Global social entrepreneurs are big players who target social and environmental problems on a global
scale. Their goal is to bring a change in social systems using their financial and international standings.
Generally, big organizations and multimillionaires go down the path of global social entrepreneurship
when they become socially responsible and focus their efforts on bringing positive change.
These organizations have lofty goals, such as fighting food shortages in an impoverished continent or
eradicating polio from the world. As a result, they work with a network of other organizations and social
entrepreneurs to achieve the desired results. However, their ambitious goals and extensive network also
expose them to greater risk, as their failure harms them more than a small–scale social enterprise. Bill &
Melinda Gates Foundation is a perfect example of a global social enterprise.
