Entrepreneurship Development

Unit 4
Social Entrepreneurship
Prof. Nuzhath Khatoon
 Social Entrepreneurship
Meaning: Social entrepreneurship is a new, innovative business venture that
influences change. Social entrepreneurs have a specific cause they care
about, and they develop a business model around making a positive impact.
The main goal is to create lasting social change through business.
• Some key areas of interest for social entrepreneurs include:
• Economic development
• Education
• Gender equality
• Healthcare
• Agriculture
• Environmental sustainability
• Renewable energy
• Community development
Social entrepreneurship can operate as a non-profit, for-profit, or hybrid
business, depending on your preferred business model and the funding
availability.
Definition: A social entrepreneur is a person who pursues novel applications that
have the potential to solve community-based problems. These individuals are
willing to take on the risk and effort to create positive changes in society
through their initiatives. Social entrepreneurs may believe that this practice is
a way to connect you to your life's purpose, help others find theirs, and make
a difference in the world.
Widespread use of ethical practices—such as impact investing, conscious
consumerism, and corporate social responsibility programs—facilitates
the success of social entrepreneurs.
• A social entrepreneur is interested in starting a business for the greater social
good and not just the pursuit of profits.
• Social entrepreneurs may seek to produce environmentally-friendly products,
serve an underserved community, or focus on philanthropic activities.
• Social entrepreneurship is a growing trend, alongside socially responsible
investing (SRI) and environmental, social, and governance (ESG) investing.
• The four primary types of social entrepreneurs are community social
entrepreneurs, non-profit social entrepreneurs, transformational social
entrepreneurs, and global social entrepreneurs.
• Social entrepreneurs design their thinking around the six P's of launching an
idea: people, problem, plan, prioritize, prototype, and pursue.
 Characteristics of Social Entrepreneurship
1. Curiosity: Social entrepreneurs must nurture a sense of curiosity about people and the problems they face. The best
social entrepreneurs seek to truly understand the needs and desires of the people they serve. Great social ventures
often start through immersive market research, an empathy-centric process through which social entrepreneurs gain
knowledge in the field.
2. Inspiration: In order to design effective solutions, social entrepreneurs must be inspired by the people and problems
they encounter. Inspiration motivates action and helps social entrepreneurs tackle challenges that others shy away
from addressing.
3. Resourcefulness: In the world of social entrepreneurship, key resources, such as human and financial capital, can often
be scarce. Successful social entrepreneurs know how to leverage the resources at their disposal and develop
innovative methods to overcome obstacles.
4. Pragmatism: Changing the world takes time, effort, and experimentation. While visions for massive social change may
provide their inspiration, experienced social entrepreneurs know that they need to take small steps in pursuit of their
goals. Great social ventures are not born overnight
5. Adaptability: Social entrepreneurs must remain open to solutions. This includes knowing when to pivot and change
their strategies if their initial methods do not succeed. Adaptability and flexibility are integral in the development of
early-stage social enterprises.
6. Openness to Collaboration: While embarking on a quest to change the world may feel lonely, it is important to
remember that social entrepreneurship is a team sport, and other people are willing to help. Social entrepreneurs
need to stay open and attentive to potential partnership and collaboration opportunities. In many cases, collaborative
initiatives and joint-ventures can achieve social/business goals much more effectively than solo endeavors.
7. Persistance: Social entrepreneurs take on some of the most daunting challenges our society has to offer. This often
creates a recipe for early-stage failures. However, the successful social entrepreneurs are the ones who persist past
initial setbacks and persevere to deliver effective solutions. Experienced social entrepreneurs know how to learn from
failures, adjust their methods, and make continual strategic improvements. Don’t give up if at first you don’t succeed!
Difference Between Entrepreneur & Social
Entrepreneur
 Difference Between Entrepreneurship &
Social Entrepreneurship
Mission and goals: The primary goal of entrepreneurship is to create a profitable
business, while the primary goal of social entrepreneurship is to create social
and/or environmental impact. Social entrepreneurs often prioritize impact over
profit.
Measuring success: Entrepreneurship measures success primarily in financial terms,
such as revenue and profit, while social entrepreneurship measures success in
terms of the positive social and environmental outcomes the business creates,
such as job creation, poverty reduction, and carbon reduction.
Customer base: Entrepreneurship often targets a broad customer base, while social
entrepreneurship may target a specific underserved or marginalized population
that is most in need of the business’s products or services.
Funding sources: Entrepreneurship typically relies on venture capital or other forms
of investment to fund growth, while social entrepreneurship may rely on grants,
impact investors, or other sources of funding that prioritize social impact.
Business models: Entrepreneurship often relies on business models, such as selling
products or services, while social entrepreneurship may use innovative business
models that integrate social and environmental impact into the core of the
business.
 Mindset of Entrepreneurs
The social entrepreneurial mindset can be described as follows-
• Seeks to identify problems in his community
• Takes responsibility to solve identified problems
• Consistently thinks through possible solutions to these
problems and inspires others to do the same
• Directly takes action to start off a venture around his/others’
ideas
• Engages all segments of his community in order to generate
buy-in into his solutions
• Accepts challenges as they occur and seeks alternatives to
bypass and overcome them
 Motivation of Entrepreneurs
1. More than good intentions: Good intentions are certainly enough for a philanthropist, when
the act of giving is the central act. Good intentions are not enough for a social
entrepreneur. To adapt a phrase, the path to a failed charity or social enterprise is paved
with good intentions
2. Look outward, not inward, for motivation: Some social entrepreneurs try to solve their own
problems, or set their own life on a better course, or fill a hole in their life, by trying to solve
the problems of others. If the motivation is to make your life seem better or richer by
intervening in the lives of others, it may not be the best for the others.
3. Efficient compassion is the best kind: It’s admirable to care about the suffering of others, but
it’s only the first step in building a successful social enterprise.
4. Listening to voices other than your own: So many self-proclaimed social entrepreneurs start
with their own solution to the problem as they see it from their place in the world. The
more effective approach is based on listening to those who experience the problem and
know more about the solution from living the problem
5. Bottom-up solutions, not top-down: Solutions are best designed and implemented from the
bottom-up not the top-down, meaning from community-based business plans and
operations management.
6. There’s plenty of room for genuinely new ideas: There is always lots of room for entirely new
ideas in social enterprise, especially in the economic development field.
7. Drawing the line between good and evil: With the great success of microfinance came a few
who would use the model created by Dr. Yunus to exploit rather than empower the poor.
 Qualities of Social Entrepreneurs
1. Innovation: A social entrepreneur adept in innovation re-imagines what’s possible and designs unique
approaches that break away from the norm.
2. Leadership: A social entrepreneur also exhibits strong leadership qualities to steer their initiatives toward
success.
3. Community driven: They recognize that a strong community can bring about substantial and sustainable
change
4. Courage: This quality is about audacity, encompasses resilience and the determination to persist in the
face of adversity.
5. Empathy: Another quality of a social entrepreneur is an innate ability to identify with and understand
people’s feelings and struggles. This quality is the bedrock for creating solutions that truly resonate with
the target community.
6. Resilience: Resilience becomes a cornerstone quality for these individuals. It’s the ability to bounce back
from failures, to learn from them, and to persevere in the face of adversity. Resilient social entrepreneurs
view obstacles as opportunities to innovate and improve their solutions.
7. Risk-taking: Instead of shying away from challenges, entrepreneurs see the potential for positive change
and progress.
8. Collaboration: Social entrepreneurs also understand that they cannot achieve their goals in isolation.
Instead, they actively seek partnerships and alliances with other groups, individuals, and organizations to
amplify their impact.
9. Desire to help others: Social entrepreneurship is driven by a deep desire to create a positive impact in the
lives of others.
10. Emotional intelligence: It is the ability to be aware of, control, and express one’s emotions, and to handle
interpersonal relationships judiciously and empathetically.
 Skills of Social Entrepreneurs
1. Effective Leadership : Socioeconomic entrepreneurs see concerns and combat unfair social challenges. They focus
on the social issues that exclude or marginalize a particular group of people. Instead of whining, they take the
initiative and look for different alternatives.
2. High Optimism : Even though many others have doubts about them, these people have a clear vision for change
and are confident that they will succeed in their endeavours. They strongly believe in their ability to modify
their surroundings and have positive self-efficacy.
3. Creativity and Innovation : For social entrepreneurs, having the intuition to spot a commercial opportunity is
insufficient; they also need to develop innovative ways to solve societal issues. Thinking creatively is frequently
used to achieve this. Value is created for the organization and its constituents through developing new business
concepts and restructuring procedures.
4. Strong Grit : This is motivation to advance, learn something new every day, and move forward in your career. It is
a combination of perseverance, passion, and hard work. Finding a solution that works is unlikely to satisfy social
entrepreneurs. They seek constructive change that transcends the traditional corporate paradigm.
5. Adaptability to adversity, obstacles, challenges, and Failures : When times are tough, they assume
responsibilities and look for openings. Financial resources, budgeting, a lack of donations, and weak
organizational structures are just a few of the challenges that social entrepreneurs may face. But each of these
difficulties offers a chance to overcome adversity.
6. Empathy : These people can inspire others by telling stories, expressing shared objectives, and involving others
through involvement. Influential public speakers are essential for social entrepreneurs. They must be able to
articulate their vision clearly for inspiration to germinate.
7. Emotional and Social Intellect: Social entrepreneurs must have exceptional networking and relationship-building
abilities. When they connect and network with the on-ground people, they understand the segments of the
fundamental problems and hence will be able to come up with better solutions. They need strong connections
to build leverage and scale for their business ideas.
Timmons Model of Entrepreneurship
Process
PCDO Framework
The Social Entrepreneurship Framework
(Social Value Proposition)
Sources of Social Entrepreneurship
• Public Sector: It businesses and organization are controlled by
the government and are state owned by all members of the
public. The aim is to generate and serve the public and not to
make profit Ex: Social services, Leisure centres etc
• Private sector: It includes business privately owned by a group
of business( known as board) or by an individual known as a
founder. Their sole purpose is to create a successful profit for
shareholders and owners Ex: Sole Traders, Partnership, Private
ltd companies
• Voluntary Sector: It is where organizations may receive grants
or funding by governing bodies and providing services to
communities without making profit.