SEEP Annual Conference October 2006

Social Enterprise:A Market Based Approach to

Poverty Alleviation

SEEP Network

SEEP Annual Conference

October 2006

State of the Practice Emerging as a field Practiced for years Fragmented Transcends several sectors Few methodologies and industry-

own resources Until recently private funding Receiving lots of media attention Universities & research institutes

SEEP Annual Conference

October 2006

A social enterprise is any business venture created for a social purpose—mitigating/reducing a social problem or a market failure—and operating with the financial discipline, innovation and determination of a private sector business

- Virtue Ventures 2005

Working Definition of Social Enterprise

SEEP Annual Conference

October 2006

Social Enterprise Characteristics

Social Purpose - created to generate social impact and change by solving a social problem or market failure

Enterprise Approach – uses business vehicles, entrepreneurship, innovation, market approaches, strategic-orientation, discipline and determination of a for-profit business

Social Ownership – public good; stewardship, rather than legal structure

SEEP Annual Conference October 2006

Social Enterprise Design is Driven by Social Concern Rather

than Financial or Market Opportunities

The social problem IS the business opportunity

SEEP Annual Conference

October 2006

Reduce social problems w/enterpriseSocial Problem 1. Food insecurity

2. Deforestation3. Subsistence

farming 4. Limited economic

opportunities5. Hunger6. Barriers to

employment

Social Enterprise1. Agricultural products

store & bakery2. Ecotourism 3. Natural products 4. Tool Library & School

5. Restaurant6. Landry,

housecleaning, thrift, etc.

SEEP Annual Conference

October 2006

Well-Known Examples Aravind Eye Hospital Kickstart echopal Equal Exchange Greyston Bakery HealthStore Grameen

SEEP Annual Conference

October 2006

Social Enterprise is a Hybrid   Purely

PhilanthropicHybrid Purely

commercial

Type of Organization

Traditional NGO Social Enterprise

Traditional for-profit

Motives Appeal to goodwillMixed motives

Appeal to self-interest

Methods Mission-driven Balance of mission

and market

Market-driven

Goals Social value creation

Social and economic value

creation

Economic value creation

Destination of

Income/Profit

Directed toward mission activities of NGO (required

by law or organizational

policy)

Reinvested in mission activities

or operational expenses, and/or

retained for business growth and development

Distributed to shareholders and

owners 

Adapted from Gregory Dees; and Lee Davis and Nicole Etchart.

SEEP Annual Conference

October 2006

Employment Model

MarketSocial Enterprise

Clients

Social Impact Financial

Sustainability

ProductProduct

SEEP Annual Conference

October 2006

Entrepreneur Model

Market

Social Impact

Client Social Enterprise

FinancialSustainabili

ty

ProductProductServicesServices

SEEP Annual Conference

October 2006

Fee-For-Service Model

Services

Social Enterprise

Sustainability

Clients

Social Impact

SEEP Annual Conference

October 2006

Market Intermediary Model

Financial

SustainabilitySocial Impact

ClientsSocial Enterprise Market

SEEP Annual Conference

October 2006

Cooperative Model

Market

Social Enterprise Clients

Social Impact Financial

Sustainability

ProductProduct

Market

SEEP Annual Conference

October 2006

Service Subsidization Model

Social ImpactFinancial Sustainability

Social Enterprise Clients

Market

Services

Social Impact

SEEP Annual Conference

October 2006

Web Resources Ashoka and Skoll Centre www.universitynetwork.org The Center for the Advancement of Social

Entrepreneurship, Duke (http://www.fuqua.duke.edu/centers/case)

NESsT (www.nesst.org) Ashoka (www.changemaker.net) REDF (www.redf.org) Virtue Ventures http://www.virtueventures.com) Social Enterprise Reporter (www.se-reporter.com) Social Edge (www.se-alliance.org) Schwab Social Entrepreneurs (www.schabfoundation.org) World Resources Institute (www.netbillion.org) Partnership on Nonprofit Ventures (www.yale.ventures.edu) William Davidson Institute University of Michigan (

http://www.wdi.umich.edu) Skoll World Forum on Social Entrepreneurship Oxford

University