In the final section of my article, I look at the evolution of social entrepreneurship, and give my Five Key Questions to Ask Re: Social Entrepreneurship and my Top Three Factors of Good Social Entrepreneurs
Five Questions and Three Factors
The landscape today necessitates that Social Entrepreneurship evolve even more rapidly, with an eye on results. We now have increasing pressure for forprofits, nonprofits, and hybrids to incorporate both business operations and a commitment to caring about our community. The goal is to provide demonstrable results, but at the same time to not lose the heart and soul of serving. Add to that an increasingly challenged global economy, the recent loss of $1 trillion in value people’s assets, and decreased funding sources, and the import of social entrepreneurship delivering results increases.
The definition of social entrepreneuship varies; each story is unique. However, the following Five Key Questions To Ask Regarding Social Entrepreneurship, as well as Top Three Factors of Good Social Entrepreneurs, can provide some helpful guidelines regarding your initiative.
Five Key Questions to Ask Regarding Social Entrepreneurship
1- Is the organizational structure nonprofit or forprofit?
2- Does the organization generate revenue?
3- Does the organization plan to achieve full profitability or sustainability?
4- What is more important: The actual service provided or the revenue?
5- Are its services scaleable across the globe?
These are questions that should be asked and debated, thought through and discussed, particular to each new or existing social entrepreneurship initiative. In a quick summary, I’d posit that social entrepreneurship can be forprofit or nonprofit, but, the entity should generate revenue. The service should be valued by both the heart – and the head. The ideal goal of a social entrepreneur would be to achieve positive cash flow, generating revenue to cover all and more of its expenses, along with delivering worldwide impact for its intended communities.
For UniversalGiving™ we chose nonprofit because I felt it would best build the UniversalGiving™ brand and our integrity as a social entrepreneurship organization. Since we are dealing with philanthropy and volunteerism, we wanted to solidify our pure intent of serving our communities. We wanted no questions as to our motives. Secondly, if we did need to make a decision between the service or the revenue, we could choose service. I could choose to help an impoverished person over revenue. If we were forprofit, I’d say one’s responsibility must be to the revenue first, due to your organizational structure and responsibility to shareholders.
We do and should generate revenue from corporate clients. We plow it right back into our public service, making it stronger and more personalized so that donors, volunteers and NGOs who visit the UniversalGiving™ website can benefit. Therefore, it is indeed a delicate balance. Every social entrepreneur needs to find the unique model which fits their social entrepreneurship motive best.
Top Three Factors of Good Social Entrepreneurs
In summary, I’ll leave you with the top three factors of being a good social entrepreneur:
1- Value Both Service and Business. You have to love the service you are providing (such as serving impoverished people across the globe), as much as running a business. You need to engage with and be inspired by leadership, strategy, sound business planning, revenue. The days of the nonprofit leader who has only heart… are over. Heart is wonderful and needed, and must be balanced with a strong desire to execute with business principles.
2- Generate Revenue. Simply leading a well-run nonprofit, in my opinion, is not enough to be called a social entrepreneur. Truly think through the value your service provides. How can it be monetized? In UniversalGiving’s case, we provide the initial service for free to the public. Anyone can give and volunteer, with 100% of their donation going to the project or nonprofit of their choice. But we then approach companies, provide them value with our international CSR management and NGO expertise, and get compensated for doing so.
3- Scale Your Efforts. If you aren’t thinking about how your venture can replicate itself in other areas, then I’d state it’s not social entrepreneurship. The highest definition of social entrepreneurship designs its products and services to grow in multiple populations, in hundreds of cities across the world. Local organizations and nonprofits are always needed and should be encouraged. But to reach an advanced level of social entrepreneurship necessitates looking beyond your locale.
Social Entrepreneurship is an exciting and now practical concept. Let’s accelerate the rate at which we can achieve good in our communities, through both sincerity and heart, as well as sound business principles and planning. At UniversalGiving™, that translates into our vision: “Create a World Where Giving and Volunteering Are A Natural Part of Everyday Life.” ™ We want everyone to think about giving and volunteering, just as they would pay their cellphone or heating bill. It should be natural. And so is social entrepreneurship — as one part of the solution to providing increased service, effectiveness and impact in our world.