What Indeed Is Social Entrepreneurship?

Leland Joseph R. Dela CruzDirector, Development Studies Program

Ateneo de Manila University

Social entrepreneurship is the in-thing in development circles

nowadays

Social Entrepreneurship

Funding SourcesSchwab

SkollAshoka

CompetitionsI Am a Changemaker

Business in Development

What is Social Entrepreneurship?

Social entrepreneurship involves sustainable earned-income activities that directly address an urgent social problem.

Financially Sustainable Earned Income Activities

• In contrast: Ashoka defines social entrepreneurs as people with innovative solutions to society’s most pressing social problems– Emphasis is on the individual, not the enterprise– Includes enterprises that do not involve earned-

income activities. – Requires innovation.

Ashoka.org, 2010

Financially Sustainable Earned Income Activities

Interrogating the Ashoka definition• Earned Income Activities and Understanding

the Philippine Context of Social Entrepreneurship

• Innovation and Social Entrepreneurship

Addresses a Significant Social Problem

• Social enterprises often associated solely with community-based enterprises, livelihood provision and income augmentation– Could address problems apart from poverty

• MDGs beyond income poverty: health (bottom of the pyramid), environment

Millennium Development Goals:Beyond Income

Slow/ No Progress• Hunger• Universal Primary

Education• Maternal Health• HIV/AIDS

Good Progress• Gender Equality in

Education• Child Mortality• Malaria• Safe Drinking Water

? Environment

Social Enterprises

• Livelihood Provision/ Enhancement– Ex. Rags to Riches, Human Nature

• Improved Access to Goods and Services For Marginalized Groups– Ex. Microfinance organizations, Botika Binhi/

Health Plus

Microfinance

In 2008: • 300 NGOs• 1,178 cooperatives• 229 banks; 9 of which are exclusively

microfinance banks

MCPI, 2008

Microfinance

Mixmarket data on 64 microfinance operations in 2008:•Gross loan portfolio: US$538.1 million•Total assets: US$765.7 million•2.4 million active borrowers

Mixmarket.org, 2010

Botika Binhi

• Establishes community pharmacies which sell generic medicines in marginalized communities.

• Sources medicines in bulk directly from generic medicine manufacturers.

• Store owned and operated by the community, trained by Botika Binhi.

• Around 700 stores maintained all over the country.

Lee, Lee and Gaspar, various dates

Beyond Enterprise Solutions

• When it comes to community-based social enterprises, not just enterprise solutions to social problems: real social dimension– Introducing community based social enterprises– Social dynamics of working with communities– Social impact– Social entrepreneur

Social Dynamics of Community Based Social Enterprises

• Who gets to participate?• What is the extent of community participation

in governance?

Dynamics of Introducing a Community-Based Social Enterprise

• Dealing with skepticism• Developing a market-orientation • Community-based management?

Social Effects of Community-Based Social Enterprises

• Beyond income augmentation• Ex. Women empowerment

Understanding the Social Entrepreneur

• Who becomes a social entrepreneur?– From business to social entrepreneurship

• Tends to have difficulty with the social side of social entrepreneurship

– From NGO to social entrepreneur• Tends to have difficulty with the entrepreneurial side of

social entrepreneurship

Beyond NGOs

Business Enterprise

NGO Social Enterprise

Primary Benchmark

Financial Returns

Social Returns Double Bottom line

Attitude towards earned income

Stuff of life Filthy Lucre Means to an end

Attitude towards making a profit

Raison d’etre Uncomfortable, illegitimate

A tool for sustainability

Baschee, 2008 as shown in Awasthi, 2010

Unleashing the full potential of social entrepreneurship

• The value chain approach and how mainstream businesses can help– Hapinoy and corporate partners, – KPMFI and Manok ni Sr. Pedro

Katilingbanong Pamahandi sa Mindanaw Foundation, Inc.• Misamis Oriental, Mindanao• Backyard Broiler Production Project• Helps farmers to incorporate poultry raising in

their farm systems.• Contract growing arrangement with farmers.• Direct links with end user.

Rejas, 2009Logo from balaymindanaw.org

KPMFI BBPP outcomesYear Number of

FarmersTotal Revenue

2006 272 PhP1.1 million2007 528 PhP4.6 million2008 589 PhP13.9 million

Household income increased by P2,000 to P6,000 a month

Rejas, 2009

KPMFI BBPP Outcomes

• Lower chicken mortality rate than large poultry farms.

• Better waste management than larger poultry farms.

Guarin, 2009

Unleashing the full potential of social entrepreneurship

• Pursue financially sustainable interventions• Don’t be limited by innovations, livelihood

provision• Account for social factors• Engage social enterprises

What Indeed Is Social Entrepreneurship?

Leland Joseph R. Dela Cruzlelanddelacruz@gmail.com

Director, Development Studies ProgramAteneo de Manila University

References• Baschee, Jerr (2008). “Social Entrepreneurship: The Promise and the Peril”, as cited

in Awasthi, Dinesh, “Promoting Social Entrepreneurship for Poverty Alleviation: the Indian Experience”. International Symposium on TVET Skills for Poverty Alleviation. 2-3 August 2010.

• Rene Guarin, former Executive Director, UMFI, 17 September 2009 presentation at the Social Entrepreneurship Conference hosted by the Ateneo de Manila University’s Development Studies Program and the Philippine Social Enterprise Network. This presentation can be accessed at http://socialentrep.ateneodevstudies.net/Day%202/Day2Panel3UMFIReneGuarin.pdf

• Various presentations by Joseph Lee and Cora Lee at the Ateneo de Manila University

• Microfinance Industry Assessment: A Report on the Philippines. August 2008. Published by the Microfinance Council of the Philippines, Inc. in collaboration with the SEEP Network.

• Richard Rejas, Executive Director, KPMFI, 16 September 2009 presentation at the Social Entrepreneurship Conference hosted by the Ateneo de Manila University’s Development Studies Program and the Philippine Social Enterprise Network. This presentation can be accessed at http://socialentrep.ateneodevstudies.net/Day%201/Day1Panel2KPMFIRichardRejas.pdf