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What is social entrepreneurship?
This module defines what is social entrepreneurship and its importance of social in achieving institutional inclusion in LATAM. It presents the main types of organizational forms and how an organization can build a path into transforming into a social enterprise. Finally, it provides a case study that details an organization’s path to creating a social enterprise.
Introduction to social entrepreneurship from the perspective of developing regions
Often times social entrepreneurship is defined as generating social and/or environmental impact while at the same time achieving financial sustainability. However, when defining social entrepreneurship from the perspective of developing regions, entrepreneurs must look beyond the term of “generating impact” and focus on how they will operationalize sustainable development to achieve the economic, social, and environmental impact intended. To do so, social entrepreneurs must learn to create new markets in contexts of poverty using a market approach to generate, achieve, and scale their impact. Ultimately, the strategy of social entrepreneurs is to negotiate impact for resources with diverse players interested on their social and/or environmental impact.
Video: Are you a social entrepreneur? (5:21 min)
This video introduces the main types of organizational forms based on its current economic return and impact generation. It helps the entrepreneur reflect on his/her entrepreneurial journey and identify which path his/her organization needs to take to reach its social and/or environmental objectives. It also differentiates social entrepreneurship from other organizational forms as social innovation, CSR, and NGOs. It highlights that social entrepreneurship is related with scaling impact through market mechanisms.
Video: Legal and financing options (6:47 min)
This video provides social entrepreneurs with a guide of the main legal forms they may use or combine to support their organization’s impact creation strategy. It presents the general implications of each legal form (for profit or non for profit) in terms of the types of resources the organization is allowed to receive and how they are useful for achieving their scaling impact objectives
For those of you that wish to delve deeper into a specific topic, we have added links to further reading you may study individually or discuss in group forums.
“From Seed to Impact – Building the Foundations for a High-Impact Social Entrepreneurship Ecosystem” by the Global Social Entrepreneurship Network (GSEN) https://www.issuelab.org/resources/23851/23851.pdf
“Scaling Strategies for Social Entrepreneurs: A Market Approach” by Urs Jäger, Felipe Symmes and Guillermo Cardoza / on Palgrave Macmillan (not open access) https://www.palgrave.com/la/book/9783030311599
This case study presents how a social enterprise emerges from the CRS department in a multinational organization and its path to generate impact whilst achieving financial sustainability.
Questions 1: How would you define social entrepreneurship? (single choice)
a. Is when an organization’s sole purpose is on creating profit.
b. Is when an organization’s sole purpose is on creating positive social impact.
c. Is when an organization is focused on negotiating the impact it generates for the resources (both financial and nonfinancial) it needs to scale with diverse players.
d. None of the above
(Answer: c)
Questions 2: What defines a social enterprise? (single choice)
a. High impact, high return
b. Low impact, high return
c. Low impact, low return
d. High impact, low return
(Answer: a)
Questions 3: Why is selecting the proper legal form(s) important to a social enterprise? (multiple choice)
a. It defines the social enterprise’s mission.
b. It determines the social enterprise’s financial identify (for-profit or not-for-profit).
c. It determines the type of investment a social enterprise can access, and which is most suitable.
d. It determines how the social enterprise can use its profits.
e. All of the above
(Answer: c & d)
Position your own project within the presented organization types and reflect upon the direction you plan to take. Identify which type of organization you want to be in the future.