Social entrepreneurship is rising as a solution to the challenges nonprofit organizations (NPOs) face, while also inspiring traditional for-profit entrepreneurs to utilize their products and services as a means to both impact community social issues and satisfy profit goals without needing to become a nonprofit organization.
But, how does an entrepreneur decide if their idea should be structured as a nonprofit or as a for-profit with a social enterprise focus?
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Set up in 2012, ArtyPlantz has incubated social enterprises working in the urban ecology and sustainability sector.
ArtyPlantz is currently incubating six social enterprises at a time, and is looking forward to onboard many more in coming days. Apart from devising appropriate business models, Radha and Murali aid these startups with finding clients, marketing and sales, strategy and finance, and social media promotions.
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What makes a social enterprise different? Put simply, social enterprises have a central social or environmental aim at the core; they trade (sell goods and services) in order to generate income; and perhaps most crucially, they use their profits to further their social purpose.
Intentionality sets social enterprise aside from CSI or corporate social responsibility. The core purpose of the business is social/environmental value, embedded deeply into the business model, rather than being “on the side”
Read More in Social Enterprise Academy
Impact investment is to a large extent still fairly unknown and under-used in South Africa, despite the vast opportunities in a country with a massive scarcity of resources, says Vanessa Jacklin-Levin, Of Counsel at law firm Dentons.
Impact investing aims to generate specific beneficial social or environmental effects in addition to financial gain. It aims to reduce the negative impact of business activity on the social environment.
Jacklin-Levin says renewable energy is one sector that allows for easier participating in terms of impact investing. “The objective of impact investing is to back ventures and projects which intrinsically have a positive social and environmental outcome as part of the company’s business model.”
The donor landscape has changed considerably over the past few years. Increasingly, the concept of "social entrepreneurship" is replacing traditional non-profit funding models, with the promise of greater self-sustainability and easier exits for donors, two key reasons why corporate and other donor agencies are increasingly turning their focus towards these hybrid organisations.
On the face of it, social enterprises make perfect sense for a country like ours, with widespread poverty and ongoing service delivery challenges placing ever-increasing burdens on the already constrained non-profit sector.
A business that can do good work in society and also be self-sustaining seems like the perfect solution to our challenges.
Unfortunately, there are a number of issues that need to be resolved before the social enterprise can truly make a lasting impact in our society.
Read more in Fin24.com
In true millennial style, there are young entrepreneurs who are about more than just making a profit but instead are combining a social mission with business and successfully making a real impact and helping to bring about change.
This is a generation that a Deloitte survey, ‘Mind the gaps: The 2015 Deloitte Millennial survey’ revealed places great importance on “job creation,” “profit generation,” and “improving society,” as well as an expectation that a business should be good for individuals by offering employment, and to have a positive impact on the wider society.
This article profiles six young social entrepreneurs who are taking action and are combining profit with philanthropy.
Read more in SME South Africa
Impact investing is a relatively new concept and its proponents are trying to create a movement that in some ways they believe would be a market solution to the world’s ills. It is extremely attractive to people who are not particularly altruistic, but know that social change is imperative for our survival. Included in this would be goods and services for the poor including micro-credit, investment in new energy technology so that we don’t warm up as fast as predicted, and of course creating jobs to alleviate poverty. The idea should be about dragging hard-nosed capitalists out of their sole focus on financial return into recognising that business has responsibilities because it affects the planet.
Since the invention of the internet, the public can see bad business practice such as deforestation, child labour and smokestacks. Corporate reputations can be ruined in minutes by social media.Hence the awareness of the need to build social capital and to appear to be good corporate citizens. Impact investing is, therefore, a way for business people who are really only interested in financial returns to grow their social capital while growing market capital.
Can impact investing then fall within the philanthropic sector as this is where the philanthro-capitalists are trying to position the concept?
Read more in the Daily Maverick
Saul Garlick’s social enterprise, ThinkImpact, was raising about $400,000 a year to support the cause. But along with running the enterprise, it had to raise funds, monitor and evaluate programs, and provide transparency. Its employees were paid below-market wages, the hours seemed endless and the organization would soon be missing payrolls.
“Nothing about that scenario was sustainable,” Mr. Garlick said. “And scale depended solely on fund-raising ability.” He was convinced there had to be a better way.
Read more in The New York Times.