Social Entrepreneurship

Learning Objectives
• To understand the economic considerations, particularly market
failures, that make social entrepreneurship desirable and necessary
• To recognize why governments are sometimes unable to solve social
and/or environmental problems
• To understand why private businesses are sometimes unwilling to
address social and/or environmental problems
• To become familiar with the relatively recent developments that
make social entrepreneurship possible
• To understand the characteristics of social entrepreneurship that
position it as a powerful force for solving society’s problems
Market and Institutional Failures
• Arthritic “Invisible Hand” – Neoclassical economists’ self-correcting
free markets have no incentive to correct considerable economic and
social harm
• Where’s Government? – Inconsistent governmental and
institutional attempts to address societal problems, compounded by
inadequate resources, lack of political will, endemic corruption, and
conflicting political ideologies
• Widening Wealth Gap – Increasing polarization and breakdown of
civil society through social disparity and economic stratification; i.e.,
the top 1%

Paul Miesing, “Introduction to Social Entrepreneurship”

So, What’s the Solution?
• Reduce poverty through creating jobs
• Develop community trust and strengthen local networks
• Make communities self-sufficient, self-esteem, self-worth, and
confident
• Increase tax base to support services
• Create markets for products produced locally rather than
importing them
• Retain local wealth as the newly-employed both buy and
spend more

Paul Miesing, “Introduction to Social Entrepreneurship”

Social Entrepreneurship
 Social entrepreneurship is an approach by individuals, groups, start-up
companies or entrepreneurs, in which they develop, fund and implement
solutions to social, cultural, or environmental issues.
 This concept may be applied to a wide range of organizations, which vary in
size, aims, and beliefs.
 For-profit entrepreneurs typically measure performance using business metrics
like profit, revenues and increases in stock prices.
 Social entrepreneurs, however, are either non-profits, or they blend for-profit
goals with generating a positive "return to society".
 Social entrepreneurship typically attempts to further broad social, cultural and
environmental goals often associated with the voluntary sector in areas such as
poverty alleviation, health care and community development.
 At times, profit-making social enterprises may be established to support the
social or cultural goals of the organization but not as an end in themselves.
 For example, an organization that aims to provide housing and employment to
the homeless may operate a restaurant, both to raise money and to provide
employment for the homeless.
 When does Entrepreneurship
Become Social Entrepreneurship?
The difference best demonstrated through the goals and
achievements of SE’s
SE’s their organisations and defining characteristics
SE Firm Social Purpose/social need Social value created
John Bird The Big Homelessness and social Economic and social benefits
Issue exclusion to homeless people
Tim Smit Eden Sustainability and Local wealth, employment and
Project environmental educational outcomes
conservation/education
Jamie Oliver Fifteen Youth unemployment Economic and social
advantage, jobs and awareness
of youth issues
Mohammed Grameen Alleviation of poverty Economic wealth stability,
Yunus Bank through affordable credit social advantage
 Why Use Social Entrepreneurship?
It is passionate It is mission-focused,
and personal to the social not profit-driven, that
entrepreneur reflects its values

It is not bureaucratic but It is accountable

nimble, moving quickly to society, not private
Social shareholders
Entrepreneurship’s
Unique
It transforms, resulting in It fosters social and
systemic change that yields
Qualifications environmental innovation
long-term benefits to solve problems

It builds, maintains, and It circumnavigates politics

utilizes social capital by by taking a business
networking for resources It facilitates development approach
by being equitable,
enhancing social stability

Paul Miesing, “Introduction to Social Entrepreneurship”

characteristics of social entrepreneurship
1. Ambitious
Social entrepreneurs often tackle major social issues and often strive to improve the
lives of certain disadvantaged groups within society. They operate in all kinds of
organizations from non-profit organizations, charities, ventures – such as for-profit
community development banks – and organizations that mix elements of non-profit and
for-profit organizations.
Example : Akanksha Foundation, She For Change
2. Mission-driven
Social entrepreneurs often focus on generating social value and focus less on profits and
revenue. When profits are generated, they are put back into supporting the social
mission of the organization. While profit is an important objective of the organization,
the money is used towards furthering the social cause and objective.
Example: Ignite-India, Make Love Not Scars, Saalumarada Thimmakka
3. Strategic
Social entrepreneurs are adept at observing what others might miss. They identify
opportunities to improve systems to create new solutions and approaches to create
societal value and make a positive change in society. Social entrepreneurs need to be
extremely determined and conscientious in order to be relentless in their pursuit of the
social objective. Example: Dexterity Global, Selco
Contd….
4. Resourceful
Social entrepreneurs often lack the strong support offered in the business world
of access to capital and market support systems due to their interest in the social
context rather than profit generation for shareholders and other stakeholders.
They need to be skilled at persuading others to agree with their ideas and
support their ambitions through financial, political, and other means.
Example: Goonj, Pipal Tree
5. Results-oriented
Social entrepreneurs focus on the end results, which transform existing realities,
open up new pathways for the marginalized and disadvantaged, and unlock
society’s potential to effect social change.
Example: Rangasutra, Frontier Markets
Challenges
Social enterprises are fast emerging as an entity of the alternative economy. When the
traditional economic systems of a country or market-based solutions fall short to ensure
well-being in the society, social enterprises can spearhead disrupting models to solve
burgeoning social problems. But the social enterprises face a myriad of challenges and
adversities.
 Lack of funding support
 Funding is by far the biggest challenge for the social enterprises.
 most social enterprises failed to secure start-up capital. Given that most of the social
entrepreneurs are individual entities, it is therefore difficult to accumulate enough
funds at the beginning.
 The traditional support mechanisms, such as – bank or financial institutions that
foster the development of social enterprises is quite scarce as compared to
commercial enterprises.
 This is to a lot extent due to the fundamental misconception that socially driven
organisations are not profitable and there is risk involved whether to money being
lend will be given back or not.
 Therefore, social entrepreneurs struggle to accumulate the required capital and mostly
invest their own savings to tackle social problems.
Contd….
Ability to scale-up
 Social enterprises primarily spring up from the social inequity or the market failure when
the traditional systems are not enough to meet the needs.
 The primary problem-involving majority of the social enterprises is that, it lacks the
ability to scale-up the enterprise to the next level.
 Most of the time it starts with immense enthusiasm or a social outlook to address any
specific problem.
 However, the lack of support and structured polices affect the social enterprise to scale it
up to the next level.
Duality of mission
 Social entrepreneurs aspire to create social value by addressing various social problems
existing in the societies.
 This aspiration, however, is not deviant from economic objective as it can also aim to
earn profit through the innovative business model.
 The traditional conceptualisation however, associates the social enterprises largely with
the notion of philanthropy or non-profit venture.
 The duality of this identity has remained a big problem for social enterprises.
 Some social entrepreneurs earn money through their ventures considering this as a more
ethical way to do business, some do this with the mission to create a social impact and
some try to create social value and develop a sustainable business model.
Contd….
Lack of proper business strategy
 Another major challenge that most social enterprises face is the lack of
proper business strategy leading to non-competitive products.
 Given the focus largely remains on social needs that to some extent impedes
the development of the actual product or service offered by the social
enterprise.
 This also hinders the development of a proper business strategy to compete
in the market as many of the social enterprises compete with commercial
enterprises.
 In addition, another fact is that the social entrepreneurs often embark on the journey
without having any prior business background which is entirely out of goodwill.
Due to this most of them would not have the required managerial skill allowing
them to plan, undertake strategic planning, financial forecasting etc.
 Therefore, the poor strategy argument can be a precipitant to the challenge of fund
raising, hinting on that the organisations that are facing financial challenges might
actually be facing a strategy deficiency and not a financial deficiency.
 Social Impact and Social Innovation
• Social Impact
• In essence, the definition of social impact means any significant or positive changes
that solve or at least address social injustice and challenges.
• Businesses or organizations achieve these goals through conscious and deliberate
efforts or activities in their operations and administrations.
• Businesses or organizations provide impacts to their consumers and the public all
the time, though in different capacities.
• Social impact, however, concentrates on the direct positive consequences these
parties offer to society.
• Social impact can derive from many different sectors and industries. The public,
private, plural, and fourth sectors all play different roles in providing to society.
• Social impact started as a form of philanthropic efforts in helping those in
need.
• No matter how small the effort is, social impact impacts everyone in many ways
we may not realize.
• When one component of society thrives, many other aspects of their lives will
flourish. This can lead to bigger and better changes.
Examples
1. Saalumarada Thimmakka: Social Entrepreneur and Padma Shri Award Winner
1. 3000 Banyan Tress
2. 8000 tress
3. 1000 orphans
2. Urvashi Sahni – Founder and CEO of SHEF (Study Hall Education Foundation)
1. 4000 Students
2. Provide livelihood to 6000 Women's
3. Sharad Vivek Sagar – Founder of Dexterity Global
1. Scholarship 10000 students
2. 500 Abroad
4. Ria Sharma – Founder of Make Love Not Scars NGO
1. 12000 Acid Victims
2. 8000 jobs
Social Impact
Social impact is the positive change
your organization creates to address a
pressing social issue. This can be a
local or global effort to tackle things
like climate change, racial inequity,
hunger, poverty, homelessness, or
any other problem your community is
facing. Healing Eyes of The World
Social impact can be about helping https://youtu.be/Wfsrg7aait8
those in need, providing resources and
https://youtu.be/3cjnNPua7Ag
advocacy, or it can be about lessening
the negative effects of doing business.

Examples: https://blog.submittable.com/social-impact-examples/ 4–19

4–20
Social Innovation
 Social Innovation is about the IDEA. And not just any “new idea.”
 For the social sector, social innovation has to be an idea — in the form of a
product, service or method — that creates change, performs better than
existing solutions and for which the value accrues primarily to society.
 We can say Social innovation is the process of developing and deploying
effective solutions to challenging and often systemic social and
environmental issues in support of social progress.
 Solutions often require the active collaboration of constituents across
government, business, and the nonprofit world.
 A social innovator is looking to solve the problem through a number of
different mediums.
 For example, a cell phone isn’t a socially innovative product by itself, but
can be used to diagnose disease.
Types of Social Innovation
• Generally speaking, social innovation can be categorised into three
main groups, namely:
 Product-based social innovation
 Process-based social innovation
 Socially transformative
 Product-based: Creates social change by offering new products for
adapting existing services to address unmet needs.
 Create more inclusive services
 Adapt existing services with new interventions.
 Changing focus of your effort
 Process-based social innovation: Creates social change by adapting an
organizational structure or internal processes to create better outcome
for services delivery.
 Adapt methods of engagement with key stakeholders
 Service users feedback
 Engage them in decision making process
 Collaboration with other organizations
 Funders
Contd……
 Socially transformative: Create social change by addressing systemic issues
such as gender inequality, domestic violence, perceptions and stereotypes.
 Womencabs
 This change can take place inside service delivery office or inside society.
 Raising public awareness on social issues or vulnerable group
 Educational Initiative
 Promote community engagement
 Influence public policy
 Wide spread information
 Research
 Ice Stupa was invented by Sonam Wangchuk in
Ladakh (India) and the project is undertaken by the
NGO Students' Educational and Cultural Movement of

Social Innovation –
Ladakh. Launched in October 2013, the test project
started in January 2014 under the project name The Ice
Stupa project.
ICE SUTPA
The water sprays out of a sprinkler at the top
of the pipe and freezes as it falls onto a conical
shape of branches. The conical shape gives the
ice stupas a large advantage over Norphel's
artificial glaciers, as direct sunlight hits less
surface area, meaning that the stupas melt
slower and provide water for longer. The ice
stupas are formed using glacial stream water
carried down from higher ground through
buried pipes, with the final section rising
vertically. Due to the difference in height,
Wangchuk explained, pressure builds up and
the water flows up and out of the pipe into
sub-zero air temperatures.

4–24
Design Thinking in social Innovation and its Application
• Design thinking is a mindset and approach to problem-solving and innovation
anchored around human-centered design.
• Design thinking is a process ideal for generating insights about human problems in
order to create innovative approaches to address those issues.
• It is an ideology based on designers’ workflows for mapping out stages of design, its
purpose is to provide all professionals with a standardized innovation process to
develop creative solutions to problems—design-related or not.
• Design thinking is different from other innovation and ideation processes in that it’s
solution-based and user-centric rather than problem-based. This means it focuses on
the solution to a problem instead of the problem itself.
• For example, if a team is struggling with transitioning to remote work, the design
thinking methodology encourages them to consider how to increase employee
engagement rather than focus on the problem (decreasing productivity).
• The essence of design thinking is human-centric and user-specific.
• It’s about the person behind the problem and solution, and requires asking questions
such as “Who will be using this product?” and “How will this solution impact the
user?”

Paul Miesing, “Introduction to Social Entrepreneurship”

Contd….
• While a traditional scientific approach to problems requires a clearly defined problem to
analyze and address, design thinking encourages a more iterative approach that synthesizes
insights to develop solutions that are “good enough for now” and that can be starting points
for continued innovation.
• Design thinkers start with a goal in mind (make life better for those in poverty in our
community) rather than a problem to solve (eliminate poverty) because problems, especially
“wicked problems,” can have many potential causes and effects that can be approached from
a variety of different angles.
• Design thinking is an extension of innovation that allows you to design solutions for end
users with a single problem statement in mind. It not only imparts valuable skills but can
help advance your career.
Why Design Thinking in social Innovation
 Social issues are always complex problems, which have too many strands
attached to them.
 There are too many aspects of a problem, that many a times get ignored by
the social innovators.
 However, solving a social problem requires taking into consideration all the
facts and figures, and then working on them.
 This is the reason why design thinking is being widely used for social
innovation.
 As a result, non-profits have begun to use design thinking extensively these
days.
Cases
• IDEO Example
• In 2008, Bill and Melinda Gates Foundation asked IDEO to codify the process of
design thinking. The foundation wanted the code to be used by grassroots level
NGOs to solve problems for small farmers in the developing nations.
• A team from IDEO worked for months in association with the International Center
for Research on Women, Heifer International, and International Development
Enterprise to get insights into the process of designing new products.
• These products, processes, and services were to be integrated with IDEO’s new
process.
• As a result of this partnership program, the Human Centered Design Toolkit was
developed.
• This methodology allowed organizations to use design thinking process themselves.
• Naandi Foundation’s Example
• In the city of Hyderabad in India, Naandi Foundation’s community water treatment
plant provides safe water. However, villagers still use free water which is not safe
for consumption and makes people sick.
• The villagers use unsafe water not because of affordability issues or accessibility
issues, but because of the flaws in the overall design of the system.
Contd…
• The problem is that the womenfolk cannot bring the heavy containers of water back to their
homes from the plant. Such problems can be solved by design thinking process.
• Consider it as an exercise to think of ideas how this problem faced by the villagers can be
solved by design thinking methodology
• Case study − Embrace Baby Warmer
• Design thinking gives a collaborative, human centered approach to solve some of the most
pressing issues of the world.
• The Embrace Baby Warmer is a solution that a team of students from Stanford University
came up with to solve the issue of providing a maintained temperature for six hours to a
newborn baby. This has helped more than 22,000 low birth weight babies around the world to
stay warm. In Nepal, low birth weight babies often developed fatal hypothermia because of the
dysfunctional incubators. The areas which lacked electricity were suffering from this problem.
• Using design thinking methodology, the students came up with an innovative solution. The
sleeping bag which they developed for newborns is portable and does not need electricity. This
way, lives are saved without any dependency on incubators.
• Design thinking puts stress on quickly prototyping the solution and tests it so that the designers
can take feedback quickly and work on the suggestion at the earliest. There have been many
examples of social innovation in the past by the students of Stanford University in countries
like Bangladesh, Nepal, India, Pakistan, etc. and many are still ongoing. Design thinking helps
people from all disciplines to try and look out for solutions to the pressing situations and
problems of the world around.
The process of Design Thinking
 Design Thinking process consists of six process steps with iteration loops:
 Understanding,
 Observing,
 Defining problems,
 Finding ideas,
 Developing prototypes and
 Testing.
 The initial three phases, the so-called problem space, describe the problem
and its causes (what is the problem and why is the problem there?).
 The subsequent three phases, the so-called solution space, describe which
solutions there can be and how these can be implemented
Phases of Design Thinking in Social Innovation
 Phase 1 “Understand“ (Understanding the Problem):
 In the first phase it is first about developing an understanding for the challenge/the
problem/the need or the requirement (problem understanding).
 It must be clarified who has to be integrated into the process and, in particular, which
technical perspective (process organization) is necessary.
 Finally, it must be clarified how the question can best be formulated so that the
customer need/problem is defined in concrete terms.
 Phase 2 “Observe“:
 In this phase, detailed research and on-site observations are carried out on the
customer's need/problem.
 Numerous methods can be used for this, such as interviews, written surveys,
observations with recordings through photos or even videos.
 The results are the clarification of the general conditions, the exact definition of the
target group and a comprehensive understanding of the customer and his needs and
behaviour.
 Phase 3 “Point-of-View“ (Define the problem):
 After the observations, the findings should next be condensed to a single prototypical
user whose problem/need is to be summarized in a clearly defined question.
Contd….
• Phase 4 “Ideate“ (Finding and selecting ideas):
• It is only in this phase that the actual brainstorming process takes place.
• Strictly separated from this, the ideas can then be analysed in a customer-oriented
manner in order to identify weak points, and a selection decision can be made on the
basis of an idea evaluation.
• Phase 5 „Prototype“ (Develop the prototype):
• In this very important phase, ideas should be visualized as quickly as possible, made
tangible, sketched, designed, modelled/simulated, etc.
• Following the technical field one can speak here of "Rapid Prototyping", whereby
the prototype development applies decidedly not only to products, but also to
services.
• A variety of methods for prototype development are available for this purpose.
• Phase 6 “Test“:
• In this final phase, the ideas are to be further developed and tested through further
experiments and customer feedback.
• In addition, important development, production and market issues have to be
clarified.
Measuring Social Return on Investment
 Social return on investment (SROI)
is a methodology that allows a
deeper understanding of the social,
health, environmental and
economic values created by a range
of NGOs/businesses implementing
projects under social contracting.
 It is a framework to measure and
account for the value created by a
programme or series of initiatives,
beyond financial value.
 They can identify how effectively a
company uses its capital and other
resources to create value for the
community.

4–33
4–34
What Is a Social Enterprise?
 A social enterprise or social business is
defined as a business with specific social
objectives that serve its primary purpose.
 Social enterprises seek to maximize profits
while maximizing benefits to society and the
environment, and the profits are principally
used to fund social programs.
 Social enterprises can be both non-profit or
for-profit organizations and may take the
forms of many different types of
organizations.
 Common in all social enterprises is the fact
that they usually adopt two main goals – the
first is to generate profits, while the second
is to reach its social, cultural, economic, or
environmental outcomes outlined in the
company’s mission.
4–35
4–36
How to Start a Social Enterprise?

Identify the
Six steps to
create the
Social
Enterprise?

https://www.youtube.com/watch?v=7178mTn
dI6A

4–37
Six Steps of starting a social enterprise
1) Articulate a problem and a solution
2) Surround yourself with experts in your field
3) Shake a hand, raise a dollar
4) Make noise in the media
5) Develop Up and reflect
6) Be able to measure your impact
How to Measure the Triple Bottom Line
 In economics, the triple bottom line (TBL) maintains that companies should
commit to focusing as much on social and environmental concerns as they do on
profits.
 TBL theory posits that instead of one bottom line, there should be three: profit,
people, and the planet. A TBL seeks to gauge a corporation's level of
commitment to corporate social responsibility and its impact on the environment
over time.
 Measurement
Measuring Profit
 A company will still usually report company-wide net income as part of its triple
bottom line. For this reason, profit is the easiest component of triple bottom line
to report as it already has strong guidance. However, it may also report or call out
several other profitability or financial metrics such as:
 Gross margin by geographical region to demonstrate consistent or equitable
pricing across different demographic groups.
 Historical federal income tax payments, demonstrating its effective rate.
 Historical information (or lack of) late payments or penalties as a demonstration
of financial responsibility.
Measuring People
Also referred to as social measures or social metrics, the people component of
triple bottom line may contain financial or non-financial measurements. Again,
some may be stipulated by generally accepted accounting principles (GAAP)
or other reporting rules, while others may be internally-sourced data.
Examples of measurements of people include:
 Average employee payroll to demonstrate livable wages that exceed local
expectations for pay.
 Average employee benefits per employee beyond pay to demonstrate the
full benefit package per worker.
 Average number of vacation hours earned and used per employee to ensure
workers can and have been stepping away from work.
 Employment demographics such as proportion of employees in different
age, race, sexual orientation, or religious groups. Note that some of this
information may be sensitive and must be provided voluntarily by
employees.
 Vendor demographics such as businesses identifying as small businesses,
LGBTQ-owned, Veteran-owned, or minority-owned.
Measuring Planet
Perhaps the most difficult triple bottom line component to measure is planet. As
a company may need to know its existing impact as well as its "eco-friendly"
impact, measuring impacts to the planet may require the most expertise or
effort. However, there are very common environmental measurements such as:
 Reductions in greenhouse gas emissions based on the difference between
former processes and forecasted changes in new processes.
 Amount of waste generated in pounds; this may also include amount of
recycled product over a period of time.
 Amount of energy consumption, adjusted for seasonality.
 Amount of fossil fuel consumption (may be adjusted for per-employee or
per-sales lead should the company be growing).
 Proportion of raw materials sourced ethically.
4–42
Evolution of Intrapreneur
The term “intrapreneurship” first appeared in a white paper titled “Intra-Corporate
Entrepreneurship” in 1978, written by Gifford and Elizabeth Pinchot for the Tarrytown
School for Entrepreneurs. That paper generated a conversation and rigorous debate
that led the Pinchot’s to publish a book on the same topic, Intrapreneuring: Why you
don't have to leave the corporation to become an entrepreneur, in 1985.
The Intrapreneurship Initiative catalogues how the term gained traction after the book
was published, appearing in Time Magazine that same year and again in Newsweek in
1986 when Steve Jobs used it to describe the Macintosh team. In 1992, the term was
added to the American Heritage Dictionary, and less than ten years later the first
Intrapreneurship Conference was held in London in 2011.
Three years later, Forbes magazine declared the social intrapreneur ‘2014s Most
Valuable Employee.’ The adoption of intrapreneurial initiatives within large companies
has taken off since then, and the term ‘intrapreneurship’ has continued to evolve as
its been popularized by mainstream culture.
Source
; https://movingworlds.org/social-intrapreneurship#getting-started-as-a-
social-intrapreneur 4–43
Emergence of “Social
Intrapreneurism’ The Social Intrapreneurship Model

Social intrapreneurship occurs

when employees engage in
social innovation while
employed by an organization. It
sits at the intersection of social
entrepreneurship, where
entrepreneurs start an
organization to address social
issues, and business
intrapreneurship, where
employees innovate new
products and services

Source: Debbie Haski-Leventhal and Ante Glavas

Read the MIT Review 4–44

Stories of Intrapreneurial Innovation
Accenture's not-for-profit consulting group
Gib Bulloch shares his personal story of how he became the Founder and Executive Director of
Accenture Development Partnerships (ADP), a ring-fenced not-for-profit consulting group within
Accenture, whose clients include many of the major international NGOs and development
agencies.

Microsoft's internal carbon fee

Tamara diCaprio at Microsoft launched a new reporting practice that makes every business unit fiscally
accountable for its energy consumption by charging a carbon fee. The proceeds of those fees then go
into a fund for purchasing renewable energy and carbon offsets. The results speak for themselves - in
the first 3 years alone, Microsoft reduced company-wide emissions by 7.5 million metric tons of carbon
dioxide equivalent (mtCO2e) through investments in efficiency, green power, and carbon offset
community projects.

Vodafone's M-PESA Mobile Money Transfer Service

Two middle managers from Vodafone and Safaricom launched the mobile payment product M-PESA
from within their established companies in 2007. As of 2012, M-Pesa had over 17 million customers,
many of whom previously did not have bank accounts.

Nick Hughes, one of the original team who created M-PESA, talks about how the mobile money
transfer platform emerged and quickly took off in Kenya. He also discusses his latest venture, M-KOPA,
a start-up that finances solar energy lighting for low income households In Kenya.
4–45
Four Ways to Ignite Social
Intrapreneurship

Support and develop the social

Elevate the collective efforts
Make mobilization of resources easy
Create & Innovate a multi-stakeholder
approach.
Source: https://sloanreview.mit.edu/article/social-intrapreneurship-
unleashing-social-innovation-from-
within/?use_credit=35319cc91d56e8e3e87c02bb4a651b59

4–46
What is scaling of social
entrepreneurship?
Scaling is defined as the most effective and efficient way to increase a
social enterprise's social impact, based on its operational model, to satisfy
the demand for relevant products and/or services.

4–47
How Do Commercial Firms
Grow?

4–48
How to solve social issues and earn
profits? Scalability

https://www.hotstar.com/in/tv/the-great-indian-disruptors/1260111657
4–49
Social Venture Strategies for Growth:

Dissemination - Make your social

venture’s model and intellectual
property (IP)
Branching- Creating multiple offices
in locations
Affiliation- On boarding similar
/relation businesses
Social franchising- A hybrid of
branching and affiliation that permits
scaling at a faster rate and a lower
cost while maintaining control over
quality and the brand

4–50
Guide to growing and scaling your social enterprise

1. Understand your ecosystem

2. Use Design-Thinking to find a product that can scale
3. Validate your scale-up business model
4. Financing your scale-up initiative
5. Build the right team and develop their skills
6. Managing your team
7. Build partnerships to keep growing
8. Report on impact (in real time)
9. Push the industry
10. Return to Step 1

https://movingworlds.org/social-entrepreneurship-guide

4–51
 1) HBR| Two Keys to Sustainable Social
Enterprise

Social entrepreneurship has emerged over the past several decades as a way to
identify and bring about potentially transformative societal improvements. Ventures
in this realm are usually intended to benefit economically marginalized segments
of society that can’t transform their prospects without help. But the endeavors
should be financially sustainable, because there’s no guarantee that subsidies
from taxpayers or charitable givers will continue indefinitely. Grameen Bank is a
famous example of a social venture that met both goals.
In studying the winners of the Skoll Award for Social Entrepreneurship, the authors
found that they all focus on changing two features of an existing system: the
economic actors involved and the enabling technology applied. For example, the
children’s rights activist Kailash Satyarthi realized that reaching ethically
concerned consumers through Rugmark (now GoodWeave International) could
help foil exploitative labor brokers in India’s carpet-weaving industry. And through
the Kiva platform, Matt Flannery and Jessica Jackley enabled small-scale lenders
in wealthy countries to lend to small-scale borrowers in poor countries. Today
GoodWeave operates globally, and Kiva is on track to facilitate more than $1
billion in microloans within the next couple of years.
2) HBR -Making Social Ventures Work: https://hbr.org/2010/09/making-social-ventures-work
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 A New Alliance for Global Change

The citizen sector, composed of millions of groups worldwide that are attempting to
address critical social needs, has long been regarded as understaffed and inefficient. Citizen
sector organizations (CSOs) are attracting talented and creative leaders, and their work is
changing the game in critical industries such as energy and health care. For-profit
companies now have an opportunity to collaborate with CSOs to create new markets for
reaching the four billion people who are not yet part of the world’s formal economy.
The power of such collaborations lies in the complementary strengths of the partners:
Business offers scale, expertise in manufacturing and operations, and financing. Social
entrepreneurs offer lower costs, strong social networks, and deep insights into potential
customers and communities. The authors call this framework the hybrid value chain. In
one example, Colcerámica, a Colombian manufacturer of kitchen and bathroom tile,
collaborated with the human-rights organization Kairos, which recruited and managed a
sales force of previously unemployed women, to reach a low-income market. Within
three years sales had grown to nearly $12 million; the living conditions of more than
28,000 families had been improved; and 179 saleswomen were each earning $230 a
month.

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Intro Impact investing

A growing number of investors want to see their money go toward stocks or funds that are
both profitable and reflective of their social values.
Three styles of investing fulfill this: Environmental, social, and governance (ESG), socially
responsible investing (SRI), and impact investing.
ESG looks at the company's environmental, social, and governance practices, alongside
more traditional financial measures.
Socially responsible investing involves actively removing or choosing investments based on
specific ethical guidelines.
Impact investing looks to help a business or organization complete a project or develop a
program or do something positive to benefit society.

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Social Impact Investing
Social impact investing provides finance to organizations addressing social and/or
environmental needs with the explicit expectation of a measurable social, as well
as financial, return. It thus aims to foster economic development while achieving
social outcomes.
Social impact investments can also be used to finance social services and social
infrastructure. In these types of arrangements, payments are normally made
based on achieving agreed social outcomes rather than on inputs or
activities. Where investors are involved, they will usually expect their investment
to be repaid and, potentially, to earn a return. This return is likely to depend on
the level of social outcomes achieved.

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4–56
Sustainable Impact Investing, takes ESG factors into account alongside the expectation of
the financial returns. Capital is allocated to assets that contribute positively to one or more
of those ESG elements (even if somewhat indirectly) while also performing well financially.
The idea is that investment opportunities that have good ESG scores will improve overall
financial performance, and those with poor ESG scores will have poorer financial returns.

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4–58
 What Is Socially Responsible Investing (SRI)?

Socially responsible investing, also known as SRI,

refers to an investment strategy that will provide
financial return while staying consistent with
For an SRI strategy, societal concerns and corporate
positive social impact and moral values. SRI is as responsibility are critical elements of making investment
straightforward as an investor who doesn’t want decisions.
to invest in an industry, they find questionable SRI is a complete spectrum of investment activities.
morally. Therefore, sustainable investing refers to a broad approach
Many investors are choosing to align their to investing in companies that used to manage themselves
portfolios with their personal values, using their in sustainable ways. These ways also include human rights
and environmental protection.
investments to make a positive impact.
investment professionals often consider SRI through
Environmental, social, and governance lens as factors for
investing. This approach also focuses on the management
SRI can also be based on moral values and
avoided in some industries such as: practices of the company. Also, on whether they tend
1.Tobacco towards community improvement and sustainability.
2.Alcohol
3.Animal testing
4.Weapons
5.Gambling, and more.

Read: The History of Socially Responsible Investing 4–59

There are several motivations for sustainable investing,
personal values and goals,
institutional mission,
Changing consumer preference,
constituents or plan participants.
Sustainable investors aim for strong financial performance, but also believe that these
investments should be used to contribute to advancements in social, environmental and
governance practices.
They may actively seek out investments—such as community development loan funds or
clean tech portfolios—that are likely to provide important societal or environmental
benefits.
Some investors embrace sustainable investing strategies to manage risk and fulfill
fiduciary duties; they review ESG criteria to assess the quality of management and the
likely resilience of their portfolio companies in dealing with future challenges. Some are
seeking financial outperformance over the long term; a growing body of academic
research shows a strong link between ESG and financial performance.

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 Who are sustainable investors?
Sustainable investors comprise individuals, including average retail investors to very high net worth individuals and family
offices, as well as institutions, such as universities, foundations, pension funds, nonprofit organizations and religious
institutions. There are hundreds of investment management firms that offer sustainable investment funds and vehicles for
these investors.
Practitioners of sustainable investing. Examples include:
Individuals who invest—as part of their savings or retirement plans—in mutual funds that specialize in seeking companies
with good labor and environmental practices.
Credit unions and community development banks that have a specific mission of serving low- and middle-income
communities.
Hospitals and medical schools that refuse to invest in tobacco companies.
Foundations that support community development loan funds and other high social impact investments in line with their
missions.
Religious institutions that file shareholder resolutions to urge companies in their portfolios to meet strong ethical and
governance standards.
Venture capitalists that identify and develop companies that produce environmental services, create jobs in low-income
communities or provide other societal benefits.
Responsible property funds that help develop or retrofit residential and commercial buildings to high energy efficiency
standards.
Public pension plan officials who have encouraged companies in which they invest to reduce their greenhouse gas
emissions and to factor climate change into their strategic planning.

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Gift Economy
 A gift economy or gift culture is a system of exchange where valuables are
not sold, but rather given without an explicit agreement for immediate or
future rewards.
 Gift economy is an economic system based on gift-giving, in which goods or
services get exchanged with no expectation of remuneration, reciprocity, or
quid pro quo.
 This system differs from a market economy (aka market system), in which
individuals exchange goods and services for money, or a barter economy, in
which goods and services get exchanged for items or services of equal value.
 An economic system in which participants give away things of value to the
shared benefit of the community.
Examples of Gift Economy
1. Donating blood: A blood donation given on a volunteer basis is a form of gift-giving
in a gift economy. When you donate blood, you expect nothing in return, but you still
receive a feeling of well-being and social belonging for giving to a stranger.
2. Koha: Koha is a custom of the Maori people in New Zealand, which involves visitors
donating or giving gifts such as food, valuable items, or money to a tribal meeting house
to support the cost of hosting a community gathering.
3. Information gift economies: These gift economies give out information freely and
accept public collaboration in an open-source format. Another example is open-source
software, where you can access and modify the source code on your operating system.
4. Potlatch: In a potlatch, a leader strengthens their community bond by giving away
valuables to their supporters and gets rewarded with attribution of honor, respect, and
social status. Indigenous cultures of the Pacific Northwest practice potlatch rituals.
5. Religious gift-giving: Many religions accept gifts or donations from their followers.
Practitioners of Buddhism, Hinduism, Islam, Judaism, and Christianity accept gifts such
as food or financial contributions as part of their religious practices.
6. Wall of Kindness: People in Iran donate all sorts of useful things to this type of wall,
including clothes, furniture, footwear etc for those who need.
Characteristics of Gift Economy
1. Community interdependence: Gift economies aim to create a social bond
between gift givers and receivers. This economic system builds strong social
relationships between different communities, in which informal, reciprocal gift-
giving ensures no one in any community will go without.
2. Delayed reciprocity: Because gift economies run on the idea that you should
expect nothing in return, gift-giving exchanges often get delayed. If you receive
a gift, you don’t pass it on or give another gift immediately.
3. Indirect gift-giving: In gift cultures, exchanging gifts is not limited to two
people; it’s broadened to the entire community. For example, you may give a
gift to someone who’s never given one to you, or vice versa.
4. Intangible or spiritual rewards: Gift economies are dependent on a type of
sacred economics. Your altruism gets rewarded with good karma, honor, or a
feeling of well-being instead of money or valuables.
5. Relaxed tracking: In the gift economy, keeping too close an eye on the value
of each gift exchange and expecting future rewards of the same value goes
against the spirit of the gift system.
Sharing Economy
 The sharing economy is a socio-economic system whereby consumers share in the
creation, production, distribution, trade and consumption of goods, and services.
 The Shared economy or the Sharing Economy is a framework of a highly flexible
economic model in which assets and services are provided, acquired, or shared
between private individuals – basically a peer-to-peer (P2P) model.
 The Sharing Economy often involves a community-based online platform that
connects buyers and sellers.
 People have shared assets for thousands of years, but with the advent of
technology and the use of big data, it is easier for asset owners and the ones
seeking those assets to find each other.
 Sharing economies allow individuals and groups to earn money from their
underused or idle assets by renting them out – simply put.
 Its an alternative to the traditional system into a system that allows for sharing of
resources, information, ideas, and services, thus enabling greater collaboration.
 This emerging economic system allows individuals, peers, and small businesses to
share office spaces, services, resources and skills at a cost much lower than the
traditional system.
 Examples: Uber, Airbnb, Ola, Oyo rooms, Trringo, etc.
Significance of a Sharing Economy
Sharing economy business model
1. Co-Working Spaces
Cowork spacing companies like WeWork provide the service of shared workspaces
across the world. Young entrepreneurs, freelancers, and startups companies that don’t
have sufficient capital to have traditional offices of their own rent a desk or an office
without having to worry about the overhead and cost of renting an entire building or
office. You have to pay a weekly or monthly charge based on your space
requirements and the amount of time you spend at the office.
Example: WeWork in BKC, Innov8 in Vikhroli, AWFIS in Banglore
2. Peer-to-Peer (P2P)
A peer-to-peer (P2P) economy is a decentralized model whereby two individuals interact
to buy sell goods and services directly with each other or produce goods and service
together, without an intermediary third-party or the use of an incorporated entity or
business firm.
Examples: ride-sharing, (Rapido, OLA, Ubar, Airbnd) short-term rentals (Nobroker)and
grocery delivery services (Blinkit).
3. Crowdfunding: Crowdfunding platforms like Kickstarter, a platform dedicated to
building a community around creative projects, connect artists who need money to get
their creative projects off the ground to those who are willing to offer. In addition, the
Sharing Economy platform allows users to fund projects they find interesting.
Example: KETTO, IMPACTGURU, DONATEKART
3. Freelancing
In this concept of Sharing Economy, people with certain skills and knowledge
offer their services in exchange for a fee. Upwork is a popular Sharing Economy
marketplace connecting those offering services with those seeking the services.
Through this platform, clients can get their jobs done by freelancers across the
world.
Example: Freelance, UpWork, 99designs, Chegg
4. Education Sharing
Learning is no longer confined to the walls of the classrooms. In this Education
Sharing Economy marketplace that connects teachers to students from all over
the world. Through the help of the latest technology, teachers are empowered to
deliver up-to-date content and impart knowledge and expertise to their students.
Examples: Unacadamy, LinkendIn, Byju