Social Entrepreneurship: Challenges and Promises for the Next
Decade
Mirjam Schöning, Schwab Foundation for Social Entrepreneurship
“Social Innovation” ConferenceRome, 7-8 October 2009
The Schwab Foundation
Objectives
1. To be the foremost organization for identifying, selecting and highlighting accomplished social entrepreneurs at the national, regional and global levels.
2. To be an effective conduit between its community of social entrepreneurs and companies as well as governments.
3. To build a global community of outstanding social entrepreneurs and others interested in promoting social entrepreneurship, leveraging successes of social entrepreneurs to achieve wider impact for the public good.
Activities
• Selection: 20-25 social entrepreneurs p.a
• Regional selection in Africa, Latin America, Europe, South-East Asia, South Asia
• « Social Entrepreneur of the Year » and respective media partnerships established in 15 key countries
• Events / Connecting Annual Meeting Davos / Dalian
6-8 Regional Meetings
• Knowledge Building Academic Activities (Case studies,
Executive Education)
Global Agenda Council & Global Redesing Initiative
The Schwab Foundation Network of the World’s Leading Social Innovators
Currently 160 organizations in total
Main sectors:• Education (47)• Enterprise Development (40)• Rural Development (37)• Health (35)• Environment (33)• Children and Youth (28)• Technology (21)• Financial Inclusion (20)• Housing (14)• Agriculture (13)• Trade (12)• Energy (10)• Waste Management (7)• Water (7)
Type of social enterprise:• 53 Social Business • 89 Hybrid Non-Profit• 32 Leveraged Non-Profit
USA and Canada
24
Latin America 38
Africa 11
Australia 2
Asia 39
Europe 40
Middle East and North Africa 12
Geographic spread:
Corporate Partnerships with Social Entrepreneurs
Basic Development
Supply Side/ Production
Demand Side/ Consumption
Linking Producers and markets:• Handicraft / Fashion • Fair trade• Agriculture
Reducing production costs:• Medical technology• Agricultural devices
Examples:• SEWA & GAP, PeopleTree• TransFair USA, Max Havelaar• IDE India• IDEAAS, Brazil
Examples:• Aravind Eye Hospital/ David
Green• IDE India / KickStart (Africa)
The Case for Engaging with Social Entrepreneurs
Basic Development
Supply Side/ Production
Demand Side/ Consumption
Access to new markets / Linking Companies and Customers / BoP:
• Financial services• Telecom • IT
Rationale for engaging SE:• BoP markets are radically
different• Deep market knowledge of
SE • Trusted Social
entrepreneurs have deep market knowledge and are trusted
Examples:
• SKS Microfinance • CellBazaar • Center for Digital
Inclusion
Entrepreneurial
Social Mission-driven
Innovative
Sustainable
Founder of for-profit or not-for-profit organization
Employs business methods, but aims at maximizing social or ecological impact. Financial return is optimized.
New products, services or approaches driving social transformation.
Revenue through fees, sales of products and services
What is a Social Entrepreneur?
Practical Visionary Focus on implementation
1. Social Business• "For-profit" organizations• Financially self-sustainable and profitable
2. Hybrid Organizations• Financing mix of earned income and
grants • Typically a combination of different legal
forms
3. Leveraged Non-Profits• Non-profit organizations• Financing primarily through partnerships
with corporations, governments and foundations
• Highly innovative and leveraged approach
The Social Entrepreneurship Spectrum
Combining social impact and financial sustainability
Combining social impact and financial sustainability Three types of social enterprisesThree types of social enterprises
1. Corporate Social Responsibility.2. Non-profit-Organisationen.Quelle: BCG-Analyse; Schwab Stiftung für Social Entrepreneurship
financial return social return
SE
Charities / NGOs2)Companies with or without CSR1) activities
Social Entrepreneurs maximize social return while optimizing financial return
30 %
50 %
20 %
Social Entrepreneurship Spectrum
Social Business Social Business Hybrid OrganizationHybrid Organization Leveraged Non-ProfitLeveraged Non-Profit
Objective/ Mission
Financial sources and goals
Treatment of investment/
Use of profits
Legal form
• Social /ecological impact maximization
• Revenues through sale of products or services•At least loss free
• Pay back principal• Reinvest profits in the SB• Grameen SB: no
dividends/interests
• For-profit entity
Degree of Innovation/ Social Change
• Adapting products and services for marketability to the “base of the pyramid”
• Involving marginalized as producers and/or distributors
• Oriented towards scalability
• Social /ecological impact maximization
• Social /ecological impact maximization
• Testing innovative market-based solutions
• Bringing products and services to the “base of the pyramid”
• Highly innovative and social change oriented
• Mobilizes a large number of partners (corporate, government, volunteers) for the cause
• Generate revenue through sales of products, services or fees • Long-term reliability on a mix of grants, (subsidized) loans and equity investments
• Combination of for-profit and non-profit entities
• non-profit entity
• Profits of one subsidiary either reinvested or paid out to non-profit entity
• No profits
• Primarily reliant on grants and partnerships
Leapfrog Fund for Technology Innovation Transfer
The Leapfrog Fund is supported by the Lemelson Foundation to stimulate the transfer and adaptation of technological innovations developed by accomplished social entrepreneurs to alleviate poverty and to provide access to clean water, energy, housing and sanitation in additional communities.
Five new transfer projects involving 11 social entrepreneur partners are being supported:
# Organisation Country Organisation Country Technology Innovation
1 TARA / DA India Sewa Lanka Sri Lankamicro-enterprise housing construction
2 IDEAAS BrazilInstituto Sertão Vivo
Brazilsolar powered irrigation systems for rural farming
3 Gram Vikas IndiaComprehensive Rural Health Project
Indiawater and sanitation systems for rural villages
4Waste Concern
Bangladesh SAIBAN Pakistanwaste management and recycling technology
5Aravind Eye Hospital
IndiaFundación ParaguayFundacionVisión
Paraguaysustainable eye-care services for low income populations
BACK UP
Examples of Leading Social Entrepreneurs
Social BusinessSocial Business
Organization: Sekem Group Founder: Helmy AbouleishCountry: Egypt
FocusLandwirtschaftsbildung, Unternehmensentwicklung, Umwelt
InnovationEntwicklung innovativer biodynam.Landwirtschaftsmethoden, Weiterbildung & Qualifizierung
Strategie Anwendung "grüner" Leitlinien und Technologien in Farms Berücksichtigung sozialer & kultureller Aspekte in Gesundheits- und Bildungseinrichtungen
Hybrid OrganisationHybrid Organisation Leveraged Non-ProfitLeveraged Non-Profit
Organization: Job Factory BaselFounder: Robert RothCountry: Schweiz
FocusArbeitslosigkeit, Jugendarbeitsbedingungen
InnovationZweite Job-Chance für Jugendliche mittels speziellem Praktikum mit effizientem Coaching
Strategie 15 profit- und marktorientierte Ausbildungszentren mit unterschiedl. Fokus (Informationstechnologien, Gastronomie, Gitarrenbau etc.) zur Berufsfindung und -qualifizierung
Organization: Teach for AmericaFounder: Wendy KoppCountry: USA
FocusBildung
InnovationHervorragende Graduierte bilden für die Bildungsgleichberechtigung aller Einkommensschichten
Strategie Ausbildung von exzellenten Graduierten zu bezahlten Lehrern von öffentl. Schulen mit Aktionsfokus in sozial schwächeren Regionen
Quelle: Schwab Stiftung für Social Entrepreneurship, BCG-Analyse
Regional Selection Process
New Regional Selection Process
• Reduction of the Schwab Foundation involvement in the national “SEOY” processes
• Focus on selecting the leading 2-5 social entrepreneurs per region/continent p.a.
Latin America Africa Middle East East and Southeast Asia India
• Using the World Economic Forum regional meetings as platform to highlight regional winners
• Development of new partnerships
National “Social Entrepreneur of
the Year” winners
Newly identified Soc. Entrepreneurs from
other countries
2-5 regional “Social Entrepreneur of
the Year” winners
Regional Selection Latin America
Name Organization Country Sector
Veronica Abud Fundacion La Fuente
Chile Literacy programs for children and youth
Marta Arango CINDE Colombia Early childhood care and development
Andre Cavalcanti de Albuquerque
Terra Nova Brazil Resolution of land conflicts and rights
Martin von Hildebrand
Gaia Amazonas
Colombia Preservation of Amazon rainforest and empowerment of indigenous populations
Rio de Janeiro, April 2009Announcement of winners:
Abbreviated List of Social Entrepreneurs submitting GRI case studies
Health• Making medical technology
affordable, PATH/Aravind/David Green
• Improving access to health services, Riders for Health
• Improving child nutrition, Un Kilo de Ayuda
• Neglected diseases, OneWorld Health• International patent reform, CAMBIA
Poverty Eradication/ Rural Development• Agriculture risk insurance, BASIX• Low-cost energy solutions,
Freeplay/SELCO• Land ownership reform, Rural
Development Institute• Solving the water scarcity crisis, IDE
India• Investment fund for start-up social
enterprises, KickStart• Reversing the urban distress migration,
Gram Vikras• Unleashing the power of the SME
sector, TechnoServe• Universal access to credit, Kashf
Foundation
Education/Human rights• Global literacy, Fundacion La Fuente• Universal socio-financial education for
children, Aflatoun• Creating an enabling environment for
girls, CAMFED/Fundacion Paraguaya
Leapfrog Fund (2)
Phase I completed:
• Site visits, training of staff and beneficiaries, stakeholder consultations and buy-in, purchases of equipment and project assessments and planning by the "importing" social entrepreneur.
• INSEAD initiated research of all 16 Leapfrog finalists discovered that 14 of the 16 replication proposals stimulated by the Leapfrog Fund are in progress (despite not receiving Leapfrog funding).
Phase II in progress:
• The final 50% of the grants has been disbursed to facilitate the purchase of equipment and employment of staff to implement and apply the new technologies.
• Some initial outcomes: Construction of sanitation facilities throughout all households in 2 villages in Jamkhed, Rajasthan.
Construction of compost plant for solid waste management and recycling programs in low cost housing development in Karachi, Pakistan
Research & development of best low-cost solar irrigation model for rural agriculture in Brazil
Production centre with equipment and trained staff established for production of earth blocks, roofing and flooring tiles and certificate training of micro-entrepreneur builders in Batticaloa, Sri Lanka.