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Social entrepreneurs go mainstream

Never let a crisis go to waste. Social entrepreneurs take this economic upheaval to be a blessing, providing a chance for business to transition from an anonymous, complex system to one that is direct and transparent.

Oxford’s Saïd Business School student Claire Williams co-founded Hope Runs in Kenya to use running to empower AIDS orphans. Social entrepreneurship is “about creating sustainable businesses that work for the benefit of both the social good and the bottom line,” she says.

Photo: J. Carrier

In the wake of the 2008 financial flameout, most business people are, to put it mildly, downbeat. Banks aren't lending, consumers aren't spending and the prospects for the rest of the year seem grim. All of which makes social entrepreneurs, well, intensely—even passionately—optimistic.

"This is a slam dunk," says Willy Foote, the founder of Root Capital, which provides loans to rural businesses in Latin America, Africa and Asia. "The Wall Street meltdown provides a chance to think about how we transition from a financial system that is complex, opaque and anonymous to one that is direct and transparent."

The world seems ready for such a change. In the middle of one of the farthest-reaching financial collapses in history, U.S. President Barack Obama came into office faced with the challenge of delivering on his promise of change. People are tired of business as usual. The exasperation is palpable, but so is the hope that this time, we can and will do things differently. Social entrepreneurs have always believed this, and for many, it's their moment to shine.

"In a world where change is escalating exponentially, the only way we'll make it is if everyone has the mindset of a social entrepreneur," says Bill Drayton, a pioneer in the field and founder of Ashoka, which sponsors international leaders in philanthropic business. "The current upheaval is a great opportunity to flip the switch. We need to make everyone a change-maker."

That will require a lot of change. According to Kevin Lynch and Julius Walls, Jr., authors of Mission Inc.: The Practitioner's Guide to Social Enterprise (see excerpt on following page), "A social enterprise is a business whose purpose is to change the world for the common good." That's a tall order, but those at the vanguard of the movement are well placed to make it happen.

The field is "a response to the failure of both business and government to deliver on their promise to society," says Lance Henderson, vice-president of programs and impact at the Skoll Foundation, which, like Ashoka, nurtures transformation around the world. "Social entrepreneurs are very good at innovation and integrating sustainability into society."

Consider reading glasses. People start to lose their eyesight around age 40. In the North, we fix the problem easily at the local drugstore. But in the South, where glasses are far more difficult to find or afford, the problem is much more serious and often costs people their livelihoods. Despite the large demand, nearly all optical companies stick to the high end of the market, so they can charge more for prescription glasses and not worry about delivering products to the South.

"Shame on us in the industry for not doing anything about it," says Jordan Kassalow, whose firm VisionSpring aims to redress the problem. "When you go to the optical firms, they're all fighting for the tip of the pyramid, meanwhile ignoring the 4 billion people who need their products, the half billion who are losing their economic lives because they can't see the work in front of them, the tens of millions more who can't learn because they can't see the blackboard. Shame on us."

VisionSpring manufactures glasses in China and sells them in Southern Asia, Africa and Latin America for roughly $4. That's often 10 percent of customers' monthly incomes, but they prove eager to purchase. Indeed, the target audience is vast, demand is steady and the impact is profound. That's the essence of what the social sector is all about—launching sustainable enterprises capable of making products that benefit people.

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