One of the great things about running your own business is the freedom to carry out your vision. But what if, in doing so, you could also help those in need? While the concept of social entrepreneurship dates back to the 1960s, it's had a resurgence and is catching on with companies big and small. The change that social entrepreneurship can bring to a community and the world at large, as well as its value to a company's image—and perhaps even bottom line—can be significant.
A social entrepreneur recognizes a social problem and uses entrepreneurial principles to organize, create and manage a system to achieve change for the longer term. This can be anything from bringing clean water to an impoverished area to providing clothes for those in need to helping build sustainable homes.
Social Entrepreneurship Models
There are a variety of creative ways a company can implement social entrepreneurship. While there's no strict formula, there are a few models companies can follow to achieve their goals. Here are four ways to incorporate social entrepreneurship:
1. Giving One-for-One
One popular model for social entrepreneurship is exemplified by TOMS Shoes and its “One-for-One” approach, which promises to give a pair of shoes to a child in need for every pair sold. According to the company's website, TOMS has given more than one million pairs of new shoes to children worldwide. Recently, it's expanded its mission to include sunglasses.
TOMS isn't the only shoe retailer with a shoe-giving program. Skechers recently introduced the BOBS initiative, which also provides shoes to children in impoverished areas for every pair sold. Online book reseller Better World Books also applies the buy one/give one model by partnering with organizations like Books for Africa and Feed the Children to distribute donated books.
2. Making a Difference with Actual Products
Some companies sell products that exemplify the very difference they're trying to make. Seventh Generation, for example, prides itself on offering green, sustainable household products that create a healthier and more sustainable future for the “next seven generations.” Likewise, EcoScraps sustainably transforms biodegradable food waste into healthy compost. These are some examples of companies founded with a broader mission as its purpose.
3. Donating a Portion of Your Proceeds
Perhaps the most common form of social entrepreneurship is when a company pledges to contribute to a cause when their product or service is purchased. Health and beauty company Lush currently donates proceeds from their Charity Pot lotion product to various charities. Project360 gives a portion of every fashion purchase to worthy causes. Even companies that don't have social entrepreneurship roots can implement this model into an existing business.
4. Providing the Impetus for Change
One of the largest organizations championing social entrepreneurship is Ashoka, which identifies and supports social entrepreneurs who have innovative and positive ideas for social change. Ashoka's CEO, chairman and founder Bill Drayton sees them as those who “[aren't] content just to give a fish or teach how to fish. They will not rest until they have revolutionized the fishing industry.” Ashoka is not funded by government entities and relies on private funding. Last year, the organization had revenues close to $30 million.
Tips for Social Entrepreneurs
If you're considering social entrepreneurship for a new or existing business, here are a few tips (as featured in Inc. magazine):
- Know your issue. Be clear on what you're passionate about and how you want to improve others' lives.
- Build the brand. Like the TOMS “One-for-One” model, it's important to differentiate your platform from other organizations and help build trust with consumers and donors.
- Think of it as a business. Even though your ultimate goal may be social change rather than pure profit, thinking of and running your organization like a business will help further your cause.
- Develop smart partnerships. It's important to align your cause with the appropriate brands to not only support your mission, but also to carry out operations and distribute goods.
- Make an emotional connection. Focus on your core mission and share it with customers by building an emotional connection such as showcasing how your organization's efforts have made an impact.
Whether it's a whole new venture or a modification to your existing business plan, even a small level of support and social action can go a long way toward helping a worthy cause—and building your brand.
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