A social enterprise is also referred to as a social entrepreneurship.
Basically, a social enterprise is a group made up of businesses, nonprofit organizations, and/or individuals that work for both social and financial gain.
A social enterprise will focus on important societal issues instead of leaving a problem for government or large corporations to take care of.
In essence, a social enterprise will work as a grassroots organization to solve a fundamental problem in society from the ground up by making a change and spreading the solution.
To give you a clear picture, here are a few social enterprises that you may already be familiar with:
- Enterprise Community Partners: This company has poured $9 million into mortgage financing, equity capital, and housing development grants to provide affordable options to low and moderate income families. This group was responsible for creating the low income housing tax credit that has allowed developers to build affordable housing while still turning profit.
- Mercy Corps: This social enterprise is an antipoverty group based in Oregon. The group began by buying out a struggling bank in Bali and reopened it to serve microfinance institutions in Indonesia. Their mission was to dramatically cut down costs for microfinancing institutions to help pave the way for a sustainable industry.
- Sustainable Harvest: Sustainable Harvest is a coffee supply chain that works to help coffee farmers earn a fair, sustainable income. The company supports farmer training and building programs to help coffee farming communities become economically self-sufficient. A company like this allows farmers to produce higher-quality organic coffee beans without having to worry about being undercut on price by large coffee distributors.
The idea behind social enterprise is a fantastic concept, but does it really work to facilitate local and global change?
Yes – if a social enterprise is able to create a solid business plan that is not only financial profitable but socially beneficial. In order for a social enterprise to see success, they must start at the bottom and work their way up. The greatest social entrepreneurs have big dreams, but it is not possible to achieve such change in one day.
This will begin to generate confidence in investors and the local community so that more investments can be made to support the venture.
Additionally, a social enterprise will never see success if they don’t remain consistent with their mission and values. A social enterprise may start out based on one great idea to facilitate change on a local, national, or global level. But as a venture starts to grow and expand, it’s easy to move away from the original vision of the company if the leaders aren’t vigilant to keep all workers on track.
Hope this has inspired you to set up your own social enterprise one day.