Social Enterprise:
A Market Based Approach to
Poverty Alleviation
SEEP Network
SEEP Annual Conference
October 2006
State of the Practice
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Emerging as a field
Practiced for years
Fragmented
Transcends several sectors
Few methodologies and industry-own
resources
Until recently private funding
Receiving lots of media attention
Universities &SEEPresearch
Annual Conference institutes
October 2006
Working Definition of Social Enterprise
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A social enterprise is any business
venture created for a social purpose—
mitigating/reducing a social problem or a
market failure—and operating with the
financial discipline, innovation and
determination of a private sector business
- Virtue Ventures 2005
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October 2006
Social Enterprise Characteristics
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Social Purpose - created to generate social
impact and change by solving a social
problem or market failure
Enterprise Approach – uses business
vehicles, entrepreneurship, innovation,
market approaches, strategic-orientation,
discipline and determination of a for-profit
business
Social Ownership – public good;
stewardship, rather than legal structure
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October 2006
Social Enterprise Design is
Driven by Social Concern Rather
than Financial or Market
Opportunities
The social problem IS the
business opportunity
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October 2006
Reduce social problems w/enterprise
Social Problem
1.
Food insecurity
2.
3.
4.
5.
6.
Deforestation
Subsistence farming
Limited economic
opportunities
Hunger
Barriers to
employment
Social Enterprise
1.
Agricultural products
store & bakery
2.
Ecotourism
3.
Natural products
4.
Tool Library & School
5.
6.
Restaurant
Landry, housecleaning,
thrift, etc.
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October 2006
Well-Known Examples
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Aravind Eye Hospital
Kickstart
echopal
Equal Exchange
Greyston Bakery
HealthStore
Grameen
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October 2006
Social Enterprise is a Hybrid
Purely Philanthropic
Hybrid
Purely commercial
Type of
Organization
Traditional NGO
Social
Enterprise
Traditional for-profit
Motives
Appeal to goodwill
Appeal to self-interest
Mixed motives
Methods
Mission-driven
Market-driven
Balance of mission and
market
Goals
Social value creation
Social and economic
value creation
Economic value
creation
Destination of
Income/Profit
Directed toward
mission activities of
NGO (required by law
or organizational policy)
Reinvested in mission
activities or operational
expenses, and/or
retained for business
growth and
development
Distributed to
shareholders and
owners
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Adapted from Gregory Dees; and Lee Davis and Nicole
October 2006 Etchart.
Employment Model
Social Enterprise
Clients
Market
Product
Social Impact
Financial Sustainability
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October 2006
Entrepreneur Model
Social
Enterprise
Client
Market
Services
Financial
Sustainability
Product
Social Impact
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October 2006
Fee-For-Service Model
Services
Clients
Social
Enterprise
Social Impact
Sustainability
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October 2006
Market Intermediary Model
Clients
Social Impact
Social Enterprise
Financial
Sustainability
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October 2006
Market
Cooperative Model
Social Enterprise
Clients
Market
Market
Product
Social Impact
Financial Sustainability
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October 2006
Service Subsidization Model
Social Enterprise
Clients
Services
Social Impact
Financial Sustainability
Market
Social Impact
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October 2006
Web Resources
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Ashoka and Skoll Centre www.universitynetwork.org
The Center for the Advancement of Social Entrepreneurship, Duke
(http://www.fuqua.duke.edu/centers/case)
NESsT (www.nesst.org)
Ashoka (www.changemaker.net)
REDF (www.redf.org)
Virtue Ventures http://www.virtueventures.com)
Social Enterprise Reporter (www.se-reporter.com)
Social Edge (www.se-alliance.org)
Schwab Social Entrepreneurs (www.schabfoundation.org)
World Resources Institute (www.netbillion.org)
Partnership on Nonprofit Ventures (www.yale.ventures.edu)
William Davidson Institute University of Michigan
(http://www.wdi.umich.edu)
Skoll World Forum on Social
Entrepreneurship
Oxford University
SEEP Annual
Conference
October 2006