Social enterprise is a hot idea. Being asocial entrepreneurship these days is way cooler than being a iBanker. I think we are only seeing the beginning of a long term trend, people realize it takes a new kind of enterprise to solve the world’s problem. And NGOs are not the solutions. Getting donations and acting as administrators are not adding enough value. They need to start thinking how to create value – here comes social enterprises.
We don't have a good definition of what is considered a social enterprise. Are they in the business of making money or a new kind of “non-profit?” Or “not-just-for-profit" company with a double or triple bottom-line? What’s the percentage of profit that they should retain in order to claim or to qualify as a social enterprise?
More questions: Who should be funding them and what is an acceptable rate of return? What kind of retained profit should they keep? Should they use the money to grow the business or given them out for social good (at the expense of the future growth of the enterprise)? What kind of social value must the enterprise create to be considered “social”? Is green considered “social”? Is healthcare in developed countries “social”?
Creating a start-up is hard enough? Creating a start-up with a social mission is harder? Creating a start-up that is profitable is not easy? And worrying about generating too much profit is an additional challenge. So what is the priority of a social enterprise? Should social enterprises be pushing for more efficiencies and economies of scale the same way as corporations do today? In that case, at what point it is at the expense of social good? All these questions warrant a lot of debates, no easy answers.
Social enterprises require creativity, passion, commitment and the right combination of investments and talents. I've seen a few interesting ideas from students' competition and here is one that I like.
MaloTraders: Founded by Temple University student Mohamed Ali Niang, MaloTraders' is in the business of processing, storing, and marketing of rice for small-scale farmers in Mali. By making local production more competitive on the international market, MaloTrade is working to alleviate poverty. Malo Traders’ social mission is to alleviate poverty, combat food insecurity, and eradicate malnutrition in Mali.
They aim to accomplish their social mission by minimizing post-harvest losses of small-scale farmers utilizing modern technology, increasing profits of harvests by creating an efficient rice value chain, and fortifying rice with micronutrients such as vitamin A, iron, zinc, and folic acid. The plan is to create the first brand of Malian rice and adhere to international export quality standards. A social brand for rice, that’s a good idea.