What is social entrepreneurship?

Posted on August 30, 2018

Social entrepreneurs are focused on combining business objectives and social issues.”

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On the rise worldwide

Social entrepreneurship has been on the rise worldwide, and particularly in Lebanon, fueled by the need to serve vulnerable and marginalized communities with the principles and techniques of the business world. With a mission to alleviate social, environmental and economic inequalities, social enterprises are driven by the passion of entrepreneurs, who aim to impact not only their direct communities but society as a whole.

 

As the popularity of social startups surges, attracting both talent and funding, Berytech has been intently working on supporting social entrepreneurs, as part of its mission to support entrepreneurship in general and by creating dedicated support tracks for social entrepreneurs in particular. Beyond our mission, we strongly believe that these innovative endeavors will be able to catalyze change in Lebanon, a country hungry to rise above marginalization, discrimination, lack of legislation, lack of civil rights, limitation in access to education, health care, public transportation, and housing. We also believe that the social groundwork set in Lebanon could be replicated in other under-served societies and economies internationally.

 

While, at its core, the concept of entrepreneurship deals with innovative problem-solving, risk-taking and exploring under-served markets, social entrepreneurship uses these basic foundations with an additional layer of contributing to Society. In the course of our work with social startups, we found it essential to set the meaning and pinpoint the boundaries within which social entrepreneurs function apart from other voluntary work and charity-oriented activities.

 

Adding a Social Layer To Entrepreneurial Thinking

Social entrepreneurs are focused on combining business objectives and social issues. They don’t necessarily measure their success in terms of profit alone – success to them is based on their definition of how they have improved the world.

 

Andy Stoll, a serial social entrepreneur, challenges young entrepreneurs to shift their thinking from: “What do I want to do? What do I want to be? And replace them with what problem do I want to solve in the world?” Stoll’s social entrepreneurial work focuses primarily on innovation, community-building, cities, creativity and making ideas happen. He co-founded The James Gang, a community-building, creativity and social entrepreneurial-incubator.

 

According to the Schwab Foundation for Social Entrepreneurship, a leading global platform that accelerates models of social innovation, social entrepreneurs share several characteristics: They achieve immense social change, focus on the social or ecological impact while earning money to support their mission, innovate solutions to a social problem and use feedback to improve.

 

Omar Itani, the founder of FabricAid, the most celebrated social startup in Lebanon in 2018, explains his choice of becoming a social entrepreneur: “We live in a country with a multitude of social and environmental problems that the government has not been able to solve. An entrepreneur can look at this in two different ways: either feel helpless and get driven to do business elsewhere or look at these problems as opportunities. To each of these problems, there is a group of people desperate to find a solution and willing to pay money for this solution. A social entrepreneur should get familiar with these problems, how they are currently being solved and how they can help people solve it better. It gives us hope knowing that young entrepreneurs from the country are capable of solving the country’s problems in an innovative and sustainable way.” FabricAid is Lebanon’s first second-hand clothes collector and distributor, offering the underprivileged good quality clothing at affordable prices.

Impact Is What Defines A Social Venture

While some professionals restrict the use of the term ‘social enterprise’ to organizations that rely on sustainable revenue to achieve their social mission, others have extended it to include outside funding in the form of grants and donations. Yet, when defining social entrepreneurship, 3 constants emerge: the entrepreneur identifies an imbalance that causes marginalization or suffering in the community. An opportunity is then identified in this inequality and with the use of creative, non-traditional strategies a ‘social’ value proposition is developed. With that, a new equilibrium that improves the lives of the targeted group and even society at large is created. These methods have gained social entrepreneurs the title of ‘social innovators’.

 

Social enterprises might not be motivated purely by profits, but having steady streams of revenue provides sustainability. This is what differentiates a social enterprise from a charity, that usually purely relies on donations or grants to achieve its social goals. Social enterprises can be highly profitable, it is just that their priority is to reinvest their profits into their social mission rather than paying out to shareholders.  

 

Social enterprises often vary in their business model. Common types include: (1) the innovation model – directly addressing a social need through innovative products, (2) the employment model – employing disadvantaged people at a fair wage and (3) the give-back model – serves the common good by giving back for every purchase made.

 

Inspiring Social Entrepreneurship Pioneers

The give-back model was made famous by the founder of TOMS, Blake Mycoskie. While traveling in Argentina in 2006, he witnessed the hardships faced by children growing up without shoes. His solution to the problem was simple: to create a for-profit business that was sustainable and not reliant on donations. With TOMS, the serial entrepreneur created the ‘One for One’ that started by donating one shoe for every pair bought and then moved on to eyewear, drinking water and birth kits. “Most people yearn to contribute, make the world a better place and have success, all at the same time. Make sure to give your business a background, a mission, and a story. That might be the most important step part of any venture. And remember, giving may be the best investment you ever make,” is Mycoskie’s advice to aspiring entrepreneurs.

 

Scott Harrison spent 10 years organizing parties in New York for the likes of MTV, VH1, Bacardi, and Elle. He then volunteered in a humanitarian mission to Liberia and saw extreme poverty for the first time: “I saw people drinking dirty water from ponds, rivers, and swamps – simply born into communities without access. It shocked and angered me, and I began learning more about the world’s 800 million people living without access to clean water.” Harrison founded charity: water, a non-profit organization that works to bring clean and safe water to communities in developing countries. Charity: water was able to raise, in seven years, over $100 million from 400,000 donors worldwide, funding 8,000 water projects in 20 countries. The organization’s biggest success is its ability to connect donors with the people they are serving and the water projects they are funding around the world.

 

On a more local level, we mention Sara Minkara, a Lebanese American young woman who lost her sight at the age of 7 and made it her personal mission to provide people with disabilities with skills they need to succeed as individuals. She founded Empowerment Through Integration (ETI) a nonprofit working to achieve an inclusive society through the recognition and elimination of social and cultural stigma against disabilities. Today, ETI reaches more than 3,000 people across Lebanon and the United States working with the blind to instill confidence in them, teaching life skills like how to walk with a white cane or how to use a computer. In 2017. Menkara made it to the Forbes 30 under 30 list in the social entrepreneurship division.  

 

One of the early pioneers of social entrepreneurship is Muhammad Yunus: In my experience, poor people are the world’s greatest entrepreneurs. Every day, they must innovate in order to survive. They remain poor because they do not have the opportunities to turn their creativity into sustainable income.” The celebrated social entrepreneur and Nobel Prize winner created the concept of microcredits for entrepreneurs too poor to qualify for traditional bank loans. The impact of his work changed the way economists, academics, policy makers and influencers think about social business. He demonstrated that one way or another, through trial and error and rethinking assumptions, something more should and can be done.

 

Driving Social Change

In short, it is the need to drive social change, with a long-lasting, impactful benefit to society that sets social entrepreneurship and social entrepreneurs apart. In Yunus’ words: “Unprecedented technological capabilities combined with unlimited human creativity have given us tremendous power to take on intractable problems like poverty, unemployment, disease, and environmental degradation. Our challenge is to translate this extraordinary potential into meaningful change.”

 

About this article

This is the first is a series of articles Berytech is writing on Social Entrepreneurship in Lebanon.

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