For profit social entrepreneurship: milestones to develop an efficient social venture
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2013-04-22
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Andreassi, Tales
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Countless appalling and alarming issues are yet scarcely resolved in spite of the mobilization of NGOs to alleviate them. For long, the private sector turned its back on such concerns. Until a new kind of ground-breaking entrepreneur appeared with a new concept to fight poverty. Mohamed Yunus pioneered social entrepreneurship when he defied conventional and stringent banking rules to lend money to Bengalis unworthy of credit, all of this while generating profits. Today, social entrepreneurship is a growing phenomenon but a majority of social for-profit entrepreneurs still struggle. And yet academic research on profit social ventures is still hesitating. This paper is a modest attempt to analyze what are the challenges a social for-profit entrepreneur will face along the journey to create his venture and sustain his objectives. The literature review relates that difficulties faced by entrepreneurs are due to several factors, comprised of issues related to market uncertainty and local environment, organizational issues, funding, ethical issues and business model resilience issues. The propositions stemming from the literature review have been confronted to real life cases through interviews with social entrepreneurs, impact investors and supporting institutions. Results seem to corroborate the initial propositions but emphasize the need to address market uncertainty issues and a proper governance design. On a market level, the identification of key stakeholders and the adoption of an effectual mindset to adjust initial assumptions to the local reality are likely to be a token of success. On the organizational level, the constitution of a skilled and committed team and the design of the right governance in order to balance between the desire to generate social wealth and the need for financial sustainability is most probably a pledge of success.