Social Entrepreneurs: Helping to Drive Change
Social entrepreneurship has emerged in recent decades as a way to bring about positive changes in society, focussing on positive change, by addressing issues such as poverty, climate change, healthcare, education, biodiversity loss and more.
They often use a business minded approach to tackle society's most pressing social problems in new ways, combining the best of business and non-profit worlds.
They are driven by wanting to make the world a better place.
A force for change
Growing environmental awareness means sustainability is becoming increasingly important in business and social entrepreneurs are at the forefront of this change.
The urgency and magnitude of global issues such as climate change, inequality, and poverty mean companies run by social entrepreneurs will play a key role in providing solutions to these problems.
Social entrepreneurs possess an ability to recognise when the markets are failing to provide what humanity needs and then to create and execute solutions to address these issues.
These include providing clean water, access to renewable energy, financial inclusion and high-quality educational resources.
In their quest to make the world a better place, social entrepreneurs often encounter challenges, such as limited financial resources and difficulty in gaining public recognition and support.
Facing up to the challenges
Perhaps the biggest challenge social entrepreneurs face is the lack of funding. The problem for many is that it can be hard to attract investment capital if the organisation is not for profit as investors may not believe there is a substantial monetary return.
This is partly due to the misconception that socially driven organisations are not profitable and are seen as risky. Traditional investors are often more risk averse than investors who support social entrepreneurs and they may not be as familiar with the social impact sector.
Investors can be hesitant about giving large sums of money to social entrepreneurs due to their lack of understanding of what they do. This can be incredibly discouraging, so having a well thought out business plan and a reliable approach to generating returns is essential.
It can also be difficult to measure the power of a company run by a social entrepreneur has to create positive change in the short term, which can deter investors. Scaling up to the next level can also be a significant challenge for social entrepreneurs as their businesses grow.
The lack of support and structured policies limits the ability of companies run by social entrepreneurs, to expand their operations and can also be harder to start than a for-profit organisation.
Commonly, they pay staff less than larger corporations, which can make the pool of talent available smaller. Finding and developing the right talent can be difficult and the problem is even worse for social enterprises looking to expand.
The importance of support structures
Having a reliable support network and resources to turn to for guidance is essential for the success of any business.
As the concept of social entrepreneurship is relatively new, there is an absence of support systems and regulations in place for businesses. This is particularly evident in the UK, where tax incentives for social entrepreneurs are still not standardised, creating confusion for those involved.
Incubators and accelerators are vital for providing social entrepreneurs with the stepping stones to help build solid foundations for their businesses.
These organisations can help social entrepreneurs expand their knowledge of business, connect with potential investors and gain a deeper understanding of their customer base. They can also provide crucial support and mentoring from social entrepreneurs who have already been through a similar journey.
Four things to consider
1. Social entrepreneurs focus on bringing about positive social change though their initiatives.
2. The biggest challenge social entrepreneurs face is finding the necessary funding for their projects.
3. As the concept of social entrepreneurship is relatively new, there is an absence of support systems and regulations in place for businesses.
4. Incubators can provide crucial support for social entrepreneurs, helping them to connect with potential investors.