1 IREX Social Enterprise Orientation Training Gbanga, Liberia Kim Alter Virtue Ventures LLC

What is social enterprise? 2

3 Hybrid Spectrum Social Enterprise Nonprofit with income activities Traditional Nonprofit Traditional Corporation Corporate Social Responsi- bility (CSR) Socially Responsible Business  Mission Motive  Stakeholder Accountability  Income invested in programs or overhead Adapted from Lee Davis and Nicole Etchart. Profit-Making Motive  Shareholder Accountability  Profits redistributed to shareholders  Both Values Economic Value Social Value

4 Definition “ A social enterprise is any business venture created to address a social problem and generate social value while earning income through commercial activities. ” In short…. “ solving a social problem with business tools and practices.”

5 What do we mean by social problems Example: Millennium Development Goals  Eradicate extreme poverty and hunger  Achieve universal primary education  Promote gender equity and empower women  Reduce child mortality  Improve maternal health  Combat HIV/AIDS, malaria and other diseases  Ensure environmental sustainability  Develop a global partnership for development

Social Enterprise Characteristics Enterprise Approach: the enterprise is the change vehicle and uses market principles and entrepreneurship Social Aims: has explicit social objectives Value creation: solve social problems while earning revenue through commercial means, generating “blended” social and economic value. Agnostic about legal form: Non-profit, for-profit, cooperative, hybrid, etc., depending on legal environment S drives E: social value before financial value

7 Social enterprise is driven by a social problem… in other words, the business opportunity lies in the social problem.

Opportunities in Social Problems ProblemsSustainable Dev. StepsOpportunities for SE PovertyGeneration of employment and livelihood opportunities Creation of micro-business services; micro-credit; community based enterprises Non-potable water and sanitation facilities Community participation in search of solutions Subsidized pricing for poor Creation of safe drinking water and sanitation enterprises Rapid population growth Empower women; and promote family planning, maternal and child health; Creation of education and health social enterprises; sale of contraceptives Ecologically damaging inefficient technologies Increase the share of renewable energy Promote green technologies Creation of renewable energy/green technology products

Social Problem IS the Biz Opportunity Social Problem  Food insecurity  Deforestation  unemployment  Illiteracy  Limited access to health services  Barriers to employment  Lost of livelihoods due to poor vision Social Enterprise  Bakery  Ecotourism  Credit & training  Publisher/education  Discount pharmacy  Café, janitorial, thrift, landscape, etc.  Reading glasses

Video Examples of Social Enterprise Martin Burt Vision Spring Greyston Bakery 10

Myth Busting: Social Enterprise Realities 11

Motivations for starting an SE

SE Impact on Organization Source: Powering Social Change: Lessons for Community Wealth Generation for Nonprofit Sustainability, Community Wealth Ventures, 2003

Mission Alignment 78% of SE relate directly to mission 3% of SE don’t relate to mission Source: Powering Social Change: Lessons for Community Wealth Generation for Nonprofit Sustainability, Community Wealth Ventures, 2003

Profitability Foster, William and Jeffery Bradach, “Should Nonprofits Seek Profits,” Harvard Business Review, February, 2005

The 1 st Point Social Enterprise is not a “quick fix” for financial ills, Running a social enterprise is not easier than running a CSO/NGO however… SE offers nonprofits many benefits including financial ones

The 2 nd Point Be clear about what you want to achieve with a social enterprise Purpose Objectives

The 3 rd Point The greater the integration the easier the execution and the greater the chance success.

The 4 th Point Social Enterprise can be a vehicle to do more social good and create more impact It is an ORGANIZATIONAL STRENGTHENING TOOL

The 5 th Point Do what you know and leverage what you have to start your enterprise

The 6 th Point Number ONE factor for success is the DESIRE to do a social enterprise Business approach fits with organizational culture