Social Enterprise: The Missing Middle
By Lisa Nitze Social 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
Government Traditional View •
Take care of those who can’t take care of themselves
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Educate the people
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Protect the environment
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Build and maintain transportation and communications infrastructures
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Build and maintain public health infrastructures
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Create and implement laws and punishments to provide safety, social stability, equity and fairness in society 3
Government Revised 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 catalyst 4
Government is Moving Towards the Middle • U.S. Department of State adopts social enterprise as important U.S. export
• Social Impact Bonds
• White House Office of Social Innovation
• SEA State Policy Toolkit
• White House Council for Community Solutions • Start Up America
• SEA White Paper on Social Enterprise • SEA Small Business Association White Paper • SEA Economic Impact Study
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Corporations Traditional 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
Corporations Revised 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
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Universities Traditional View • Educate the best on higher level thinking • Stick to education
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
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Universities are Moving Towards the Middle
• Economic and Social Development no longer taught as zero-sum
• SEA Chapters harness students for directed research and internships
• Triple bottom line decision making skills honed
• Social Enterprise case studies needed 10
Non-Profits The 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 Enterprise The 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 12
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 Clustered Solutions
B2B Marketplaces
• Bell Tower
Consortia
Templated Solutions for Expansion through Franchising
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Select Examples of Social Enterprises Common Ground Homelessness Real estate development Juma Ventures Underprivileged Youth Employment and Training Project Health Urban Health Clinics Hospital Contracts
Women’s Bean Project Women in Transition Product Assembly/Retail Sale Harbor City Services Mental health Corporate Shredding, Moving, Filing, Storage
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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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5358 42nd Place, NW Washington, DC 20015 (202) 758-0194 www.se-alliance.org info@se-alliance.org
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Session Evaluation Information
SESSION TITLE: Enterprise SESSION CODE: L-W1045
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