While the idea of making a difference and making profit might seem at odds with each other, social entrepreneurship is not exactly a new model and it’s actually a viable way of doing business. RACHEL WORSLEY explains.
In an era of big profit margins and consumerism at all costs, it’s hard to believe that there are some businesses out there which make money for the greater good. That’s where social entrepreneurship comes in. The concept has been around for more than 30 years now. However, in the age of convenience, the internet, and a greater awareness of social problems that confront society, many people are turning towards organisations who want to make an ethical difference to their bottom line.
So what is social entrepreneurship? Simply put, it’s the model of doing business to make a difference rather than doing business for profit. The business still sustains its founders and workers, but much of the profit goes into helping the cause and the community they ultimately serve. Social enterprises are all about applying practical, innovative and sustainable approaches to benefit society in general, such as the marginalised and poor.
For the Schwab Foundation for Social Entrepreneurship, the social entrepreneur has to possess the following traits: an unwavering belief in the power of people to contribute meaningfully to economic and social development, a passion to change things, a practical but innovative stance to a social problem and a zeal to measure and monitor their impact.
So is it for everyone? According to Social Enterprise Finder, a website that attempts to list all active social enterprises, there are at least 5483 social enterprises currently operating in Australia. They serve a wide variety of areas, like agriculture, employment, childcare, music, cooking, clothing and microfinance. People under the age of 30 make up the bulk of this demographic of social entrepreneurs.
One of the most successful social enterprises in Australia is ThankYou. In 2008, a group of university students discovered that over 900 million people in the world didn’t have access to safe drinking water. They also discovered that Australians spent $600 million on bottled water every year, an astonishing figure given that tap water is free, and usually safe.
These extreme figures made them realise that something wasn’t quite right. Before they knew it, ThankYou Water was born – a bottled water company existing for the sole purpose of funding safe water projects in developing nations.
Today, ThankYou has expanded into a movement encompassing food and hygiene: a sign of the adaptability of the social enterprise model to the same mission of providing everyday Australians the chance to buy high quality products to make a difference to the developing world.
But not all social enterprises have an eye to solving the world’s problems and sometimes the problems they are addressing are right here, at home. One Night Stand is one of these social enterprises. The sleepwear company reinvests the profits made from their products into tackling homelessness in Australia. Their founder, Jamie Green, was just another person who thought he could make a difference. And he did.
Social enterprises aim to eliminate the divide between making a difference and making a profit. They are mutually convenient goals that serve a common purpose. Once, people thought the only way to make a difference was to donate time and effort to a cause. Now, it’s apparent that capitalism can be reengineered for the social good. And the rise of technology has a lot to do with this growth in social conscience.
However, not every project has easy access to capital funds to jumpstart their service. Many rely on crowd funding services. The Fabric Social is a person-to-person app and online store that is encouraging conflict affected women to sell their apparel directly to the international market. So far they have gathered a few thousand dollars towards their goal. They are optimistic that this will take us one step closer to more ethically responsible fashion. In fact, the Fabric Social is part of a greater conversation about the ethical manufacture and purchase of clothing; an issue that came to prominence with the tragic collapse of the Bangladeshi factory in Rana Plaza last year.
So can social entrepreneurship be taught? Or is it all about support? The School for Social Entrepreneurs (SSE) Australia runs learning programs for people of all backgrounds that have an idea or business with a community background. It’s an offshoot from the highly successful model established in the UK. One Night Stand is one of their most notable alumni, but there are many success stories lurking behind those doors.
Even universities are getting onto the act. Macquarie University and the Macquarie Graduate School of Management have recently launched their first Master in Social Entrepreneurship in the belief that yes, social entrepreneurship can be taught and people can be accredited in the process.
And there’s no shortage of support from for-profit companies. Insurance company ING DIRECT launched the Dreamstarter initiative to provide funding support to selected StartSomeGood (a social entrepreneur specific crowd funding platform) campaigns. For companies that have a great idea, but lack the funds to get started, it’s a great alternative to breaking the bank or begging for venture capital from a very charitable businessperson.
Ultimately, it seems that social enterprise begins with the individual and the idea. While it’s easier than ever for people to start up a social enterprise, the real skill lies with how commercially successful that enterprise can be, and how it reinvests its profits for the greater good.
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