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Social Enterprise: The Missing Middle 1 • The world’s problems are outstripping our current initiatives to address them – not necessarily our current capacity to address them • Our old models for how to address social problems need to be updated • Resources residing in silos need to be combined through collaborative partnerships for maximum positive social impact 2
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Social Enterprise: The Missing Middle
By Lisa NitzeSocial Enterprise Alliance
1
A New Vision
• The world’s problems are outstripping our current initiatives to address them –not necessarily our current capacity to address them
• Our old models for how to address social problems need to be updated
• Resources residing in silos need to be combined through collaborative partnerships for maximum positive social impact
2
GovernmentTraditional View• Take care of those who can’t take care of themselves
• Educate the people
• Protect the environment
• Build and maintain transportation and communications infrastructures
• Build and maintain public health infrastructures
• Create and implement laws and punishments to provide safety, social stability, equity and fairness in society
3
GovernmentRevised View• Provide those who can’t take care of themselves with the tools to help
themselves
• Partner with others in the market to educate, protect the environment, create and maintain infrastructures, protect public health
• Provide incentives for people to self-govern for safety, social stability and equity
• Use leverage to convene partnerships among sources of resources for public good
• Use leverage to convene stakeholders around issues so they can define a middle ground
• Incentivize corporations to invest in societies’ well-being
• Provide seed-funding, be the convener and catalyst4
Government is Moving Towards the Middle
• U.S. Department of State adopts social enterprise as important U.S. export
• White House Office of Social Innovation
• White House Council for Community Solutions
• Start Up America
• Social Impact Bonds
• SEA White Paper on Social Enterprise
• SEA State Policy Toolkit
• SEA Small Business Association White Paper
• SEA Economic Impact Study
5
CorporationsTraditional View• Emphasis on short-term profit for shareholders• See societal needs as the job of government• See environmental issues as the job of government• See non-profits as an adjunct of government and make
annual contributions to them as asked• See Universities as disconnected from economy• See citizen and advocacy groups as on another team• See government as ineffective
6
CorporationsRevised View• See other stakeholders in society as partners in
long-term health and sustainability of:– Communities where operate– Employees– Customers– Suppliers– Distributors
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Corporations are Moving Towards the Middle
• Investment in communities is good business• Social investing moving out of CSR and directly
into business models• Top employee recruits are demanding robust
community investment strategies from their employers
• Hybrid value chain partnerships proliferating
8
UniversitiesTraditional View• Educate the best on higher level thinking
• Stick to education
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Revised View• Educate to market needs
• Partner with corporations, government and non-profits to create societal and commercial value while educating
• Commercialize learning where possible
Universities are Moving Towards the Middle
• Economic and Social Development no longer taught as zero-sum
• Triple bottom line decision making skills honed
• SEA Chapters harness students for directed research and internships
• Social Enterprise case studies needed
10
Non-ProfitsThe Traditional View• Model of meeting need through dependency on
donations• Model of pursuing good without responsibility for
figuring out how to pay for it• Lack of connection to market drivers allows
original model to become out of touch• Federal programs do not meet local needs with
local solutions
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The Social EnterpriseThe Revised View• A market-based, business-like approach to
solving a social problem • Its mission is to meet a societal need in a way
that is self-sustaining• Simultaneous pursuit of social and economic
development that is not zero-sum• Partnering with government, business,
universities and all other sources of resources creatively to achieve goals
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What is a Social Enterprise?
• A “Social Enterprise” is a nonprofit or private sector entity that: – Uses earned revenue strategies, either exclusively as
a business or as a significant part of a nonprofit’s revenue stream, and
– Directly addresses social needs either through its goods and/or services or by employing people who are disabled or disadvantaged
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Social Enterprise is Becoming the Middle
• Bell Tower
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Templated Solutions for Expansion through FranchisingConsortia
Clustered Solutions B2B Marketplaces
Select Examples of Social Enterprises
Women’s Bean ProjectWomen in TransitionProduct Assembly/Retail Sale
Harbor City ServicesMental healthCorporate Shredding, Moving, Filing, Storage
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Common GroundHomelessnessReal estate development
Juma VenturesUnderprivileged YouthEmployment and Training
Project HealthUrban Health Clinics Hospital Contracts
Economic and Social Infrastructures Can’t Keep Pace with the Growth of Social Enterprise
• New legal and tax structures are needed• Access to growth capital is constrained by outdated
frameworks• Clear definitions of the sector are necessary to
measure impact• Branding and awareness building is required to
drive greater growth
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The Sands are Shifting and Stakeholder Roles are Changing in the Economy and in Society
• Social and economic development are no longer mutually exclusive
• “Nonprofit” and “For Profit” are rapidly becoming outdated distinctions
• Triple bottom line analysis is being done by all actors in pursuit of sustainable progress
• The new constant is change
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Session Evaluation Information
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SESSION TITLE: Enterprise
SESSION CODE: L-W1045
