What is Social Entrepreneurship?

September 08, 2018

What is Social Entrepreneurship?

Here at porze, we have been wondering what we should call what we do - it's a business for a cause, but does that sum it up in the best way to explain it to people?

How do you explain that you are trying to balance making a dollar AND making a difference, especially when people seem to struggle with reconciling the two seemingly contradictory principles.

You see, for most of history, ventures were founded upon one of two business models:

  1. A commercial enterprise would be established to maximize financial returns, or
  2. A not-for-profit or charity would be created to maximize social and environmental returns. 

But now, with growing social awareness among consumers, a greater sense of accountability among businesses, and tighter government regulations, a newer continuum of business models has emerged. These models include everything from Social Enterprises to Social Purpose Businesses

A recent article in Millenial Magazine explains 'A social entrepreneur is a person who creates a profit and purpose driven organisation in which the business and social missions run in tandem. 

If you look a little deeper, it turns out that there are a number of different types of social enterprise, some more well know than others:

Community project - any community-based project or initiative

Non-profit organisationan incorporated organisation which exists for educational or charitable reasons, and from which its shareholders do not benefit financially. Surplus revenue is reinvested in the organisation.

Co-operative - a community-focused businesses, legally incorporated and  owned by its members who use its services or purchase its products. Co-ops can be either non-profit or for-profit enterprises. The co-operative sector keeps dollars circulating within the local economy, provides secure employment and is a means to revitalize and sustain healthy communities

Social Enterprise - uses business operations and strategies to generate revenue from the private market to assist in sustaining the organisation’s primary services. Different forms of Social Enterprise can include:

  • Training for those with challenges in facing the workforce
  • Employment creation for marginalized populations
  • Businesses owned and operated by Indigenous communities

Social Purpose businessa profit making enterprise that has a positive social and/or environmental mission at its core and the goal of creating both economic and social value. Another way to describe a social purpose business refers to having a blended value or triple bottom line: people, planet, profit.

And it is this last type of social enterprise, 'social purpose business' that fits the porze business model.

Unfortunately, with the growing social awareness of consumers, some organisations will try to portray themselves as having a social purpose or being environmentall friendly when they, in fact, are not!

Our next blog will look at this 'Greenwashing' in more detail.

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If you would like to read more intersting topics, please go to the porze for thought blog page here.