We can´t go back to normal! Let´s talk about social enterprises.6 min read

We can´t go back to normal! Let´s talk about social enterprises. By David Pérez
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We can´t go back to normal!

I recently had a conversation with a friend about COVID-19; the USA seems to be returning to pre-pandemic times, and the numbers back that up, so it makes sense that things would go back to normal. However, we decided to keep looking at the declining numbers on the map and saw that most Latin American countries are still in the middle of the pandemic, with most of them reaching new peaks in both cases and deaths.

This is not surprising to anyone.  It is just another reaffirmation of what we have been able to see throughout the pandemic. “Our current economic model has reached its expiration date, or in fact, it had been already reached some time ago. The global pandemic has made this statement painfully clear, as pre-existing inequalities have surfaced due to COVID-19. ” (Euclid Network, 2021)

Muhammad Yunus says it clearly: “Many of us were raised to believe in the slogan “Economic growth is a rising tide that lifts all boats.” The saying ignores the plight of the millions who are clinging to leaky rafts or who have no boats at all.” (Yunus, 2013)

A rising tide

We have said it before, and we will repeat it as many times as we have to; we can´t go back to normal, when normal was broken in the first place. It is imperative that we look at what we are doing in every facet of society to make sure that everyone realizes quick wins for the very few are simply not sustainable.

One sustainable solution to this problem is creating a social entrepreneurship ecosystem that allows these organizations to flourish and help society both today and in the future.  I would like to use this article as an opportunity to go over the basics of social entrepreneurship and its importance in a post-pandemic world. 

What is a social enterprise?

Think about the typical business that you know. Is there anything wrong with it? (Well, we would argue there is nothing wrong with them, but some of them certainly need to be improved.) A social enterprise could be just what is required in order to support a specific set of social goals. In essence, a social enterprise is a typical business but with a critical underlying philosophical difference.

A social enterprise is a business whose primary objective is either social or environmental, not economic. However, the definition has changed rapidly as the industry evolves. The Social Enterprise Alliance has a working definition, which states that social enterprises are “Organizations that address a basic unmet need or solve a social or environmental problem through a market-driven approach.” (Social Enterprise Alliance, 2021)

Social enterprises are not created to focus on economic profit like traditional businesses; their end goal and mission is mainly to contribute to the betterment of society and the world we live in.

Team of volunteers stacking hands
Team of volunteers stacking hands

What differentiates a social enterprise from a nonprofit?

Even though social enterprises and nonprofits are both driven by social or environmental goals, the difference is clear. Nonprofits gather money through donations, grants, and many other methods and put the entirety of that money towards social issues. In contrast, social enterprises use the money they make by selling services and goods to further their cause.

It is important to note that social enterprises can be created by both for-profit and nonprofit organizations. In some cases, they take the form of co-operative, mutual organizations, social businesses, or charities.

Why are social enterprises important?

Some of you may be wondering why social enterprises are important. If they tend to the same needs of nonprofit organizations, the answer can be summarized in two words: sustainability and growth.

Social enterprises are the natural evolution of our economic model. They take the best of capitalism and bring a social perspective into the conversation. When making money is no longer good enough, social enterprises are able to create change.

Being built from the ground up as a business, but with the primary goal of furthering a specific social cause makes social enterprises completely self-sustaining. The general operation of the organization is just like any other business. The difference between a social enterprise and a regular business is what they do with the money. In a social enterprise, they go to further the cause and create more positive change across the globe.

Nonprofits still have a place. Social enterprises simply complement them. As we have seen before, some of them are created as nonprofits from the get-go. There are many other benefits to social enterprises, and we will address them in another article.

What are the challenges of social enterprises?

Social enterprises have multiplied in the past few years. They are usually born from the vision of what we call a social entrepreneur, someone who has a clear idea of a problem they want to solve but, more often than not, they don´t seem to have a clear plan on how to get there.

Here are 5 of the most common challenges faced by social enterprises, according to Centric:

  1. “Lack of a ground-up business plan
  2. Lack of awareness amongst the public
  3. Need for a proper sales team
  4.  Investing in branding elements
  5. Process management and planning for growth” (Centric, 2021)

Social enterprises face other challenges, such as gaining access to finance, developing suitable business models, balancing organizational vision with corporate policies and consumer demands, and perhaps most importantly, gaining compliance. This is an ample opportunity for governments, banks, and multinational organizations to fill the gap with training programs for social entrepreneurs.

Final words

I want to end this article with the same message that I offered in the beginning. We don´t have the luxury of going back to normal. Normal was never good enough. We need to be better, and we need to find better solutions.

Although social enterprises are relatively new, it is expected that this sector will grow at a fast rate over the coming years. As such, it is wise for entrepreneurs to learn about this area. They need to be aware that social enterprises are operating successfully in many countries and provide an extremely valuable service for the business community and society as a whole.

Ruh Global IMPACT is a social enterprise. We have spent 8 years furthering the cause of disability inclusion through our efforts in:  Digital Inclusion, Disability & Elderly Inclusion, Accessibility & the Aging Marketplace, ICT & Built Barriers Accessibility, Inclusive Design, and many other areas. We know firsthand the problems that come with the territory, but we also know that it is worth it. We are certain that if social enterprises grow and have a place in society, the future will be better and more sustainable for everyone.


References:

Centricbrandadvisors.com: https://centricbrandadvisors.com/5-last-mile-challenges-faced-by-social-entrepreneurs/

euclid Network. (2021, January). Social Enterprises Are The Future: Why We Cannot Afford To Waste This Crisis. Retrieved from euclid Network: https://euclidnetwork.eu/2021/01/social-enterprises-are-the-future-why-we-cannot-afford-to-waste-this-crisis/

Social Enterprise Alliance. (2021). What is Social Enterprise? Retrieved from socialenterprise.us: https://socialenterprise.us/about/social-enterprise/

Yunus, M. (2013). A World of Three Zeroes. Public Affairs.

About the Authors

David Pérez

Chief Financial Officer 

Ruh Global Impact

David is a Costa Rican Political Scientist with his MBA and masters in diplomacy. He is also a leader, advocate, social media specialist, and communication strategist. David has experience in public policy implementation, development, evaluation, and consultancy services for NGOs like UNESCO and others linked to the European Union. David´s professional background is mainly in work with minorities, ensuring they have access to their rights.

His primary focus is to expand Ruh Global IMPACT’s vision across the globe and impact the lives of People with Disabilities both in developed and developing countries. He has spoken in Latin America and the US on disability inclusion and accessibility. He has been asked to be a Visiting Professor on these topics and the Future of Work for The University Del Norte in Barranquilla, Colombia. David recently was a keynote speaker at the Future of Work and the Employment of Persons with Disabilities in one of the first conferences on this topic in Colombia. David is fluent in Spanish and English and often advocates for Americans (Latin, South, and North America) that speak Spanish. 15 to 20% of the US population are Spanish Speakers, and this group is often disenfranchised in the US.

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