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Social Entrepreneurship: A Business Model for the Masses
Entrepreneurship can be explained as the activity that involves building a business, making it successful and in the process, getting wealthy and expanding an idea. There are numerous with an amazing spirit, drive, focus, and vision. There are also a number of stories that show how entrepreneurs become power hungry and ruthless. Taking everything and leaving nothing behind. Social entrepreneurship is an approach to business building that is inclusive; in fact, it is the opposite of the hunger for power.
How can entrepreneurs be social?
The main motive of a business is to make profits right? Not always and it is, in fact, an ancient notion.
Social entrepreneurs look to help and make the society at large able grow with them.
They directly tackle issues that plague or pull down society and communities around their immediate vicinity. For example there are a number of startups and emerging businesses that deal with the problem of hunger, homelessness, lack of access to education, and even healthcare for those who cannot afford it. In my hometown Milwaukee, WI we have a tremendous amount of non-profits doing phenomenal work, so what’s the difference?
So social entrepreneurs are those who start non-profit social organizations?
Atul Tandon, is owner of Tandon Insistture, their motto is Accelerating Social Enterprises Worldwide. In an inteview with Forbes, when discussign the difference between non-proftis and social entrepreneurships, he said,
The non-profit label in my mind is simply a label that denotes the tax system, the IRS enterprise. The word social enterprise, however, in my mind is defined differently. It’s an enterprise that is focused on building the social good, the common good. It could be for-profit, it could be non-profit, it could be a cooperative.
While it may seem like a social enterprise is nothing but a modernized non-profit, it is not. While non-profit or not-for-profit organizations are sometimes involved directly with social issues and have been doing it quite successfully over the years, their business model is completely different. A non-profit relies solely on aid from funding organizations, charities, donations and grants. A social enterprise has a sustainable source of income for all of its activities. Which is why I founded The Rose That Grew.
It’s in the philosophy!
Social entrepreneurs rely on no one but their own business for funding. For example, to create jobs in a community, a person may open a small restaurant or bakery. With the money earned, a social entrepreneur will reinvest the money back into he community or use it to expand. The reliance on donor funds is limited.
In all of this, it is even possible for the entrepreneur to make a small profit.
What is done with the profit earned is what sets an enterprise like this apart. The business aspect will never take a backseat. Most social enterprises will look to expand and make a mark in both the business world as well as in the society they function in.
So the main difference lies in the philosophy. Social entrepreneurs innovate by finding a new product, a new service, or a new approach to a problem.
The Ultimate Business Model
A business model like this helps people at large as well as makes a decent amount of profit, but it may not be suitable for all types of businesses. What has to be kept in mind is that a social enterprise serves more than one bottom line.
The company has to make a profit for it to be sustainable, but the social aspect of it must never be overshadowed.
There are a number of social entrepreneurs who have managed to not only create sustainable businesses worldwide, but also touch the lives of those involved and benefited from it. Take the excellent example of Asoka, an organization that has not only helped define, but also make social entrepreneurship a real model to follow.
Prior to the creation of your business; seriously consider whether you’d like to operate like a non profit or a social enterprise.
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