Chapter 4: Supporting Social Entrepreneurship

The two types of enterprising nonprofits

-Earned-income activities -Venture philanthropy.

Three Primary Attributes of Stakeholders

-Power: SH has the ability to either help or hinder your social objectives. -Legitimacy: SH whose actions are appropriate, proper, and desired in the context of the company, organization, or community. -Urgency: describes the extent to which stakeholders demand your attention. *Not independent of one another; SH may hold more than one attribute

according to the Big Belly company video, they claim that trash collection costs are reduced by ____% when using the Big Belly collection system

75%

venture philanthropy funding

A combination of financial assistance such as grants with a high level of engagement by the funder. -Venture philanthropists share their experience with nonprofit entrepreneurs to help grow and scale the company to drive social change.

hybrid model of social entrepreneurship

An organization with a purpose that equally emphasizes both economic and social goals. Example: Better World Books; earns money by taking donations of new and unwanted books and selling them online.

Good corporate social responsibility

CSR Makes Good Business Sense

Wicked problems

Coined in 1960; large, complex, social problems with no clear solution; with limited, confusing, or contradictory information available; whole range of people with conflicting values engage in debate. -Problems are so complex that traditional linear problem-solving methods do not work.

the city used to demonstrate how the Big Belly system works was:

Dayton, Ohio

Main difference between traditional vs social entrepreneurship

Differ by their intended mission. -Traditional entrepreneurs create ventures with a goal of making a profit; they measure performance by the profits they generate. -Social entrepreneurs create ventures to tackle social problems and bring about social change; they measure performance by advancing social and environmental goals.

Typology of Ventures

Different models of social entrepreneurship

Dormant Stakeholders (sleepers)

Dormant stakeholders are "sleepers"—they hold power but do not tend to use that power unless they are given a reason to do so.

Social consequence entrepreneurship

For-profit ventures whose primary market impact is social. Example: Sword & Plough; hires army veterans to recycle surplus military materials such as parachutes, sleeping bags, and tents into fashionable bags and accessories.

dependent stakeholders (expectant)

Have both urgency and legitimacy but lack the power to influence. The most passionate SH; passion is likely to attract dominant stakeholders.

Wicked Problem Issues

Issues relating to the environment, poverty, sustainability, equality, education, child mortality, sanitation, terrorism, global refugee crisis, and health/wellness

Stakeholder identities & map

May include employees, volunteers, investors, customers, suppliers, and manufacturers, leaders in nonprofit organizations, community leaders, the government, sponsors, board members, and other entrepreneurs.

Social purpose ventures

Resolve a social problem and make a profit. Example: Organic company PACT; firm designs, manufactures, and distributes premium cotton underwear without using pesticides, fertilizers, or chemicals.

The Salience model of Stakeholder Classification

Stakeholder classification based on their salience (significance) in the social enterprise.

Mitchell Stakeholder Typology

Stakeholders are not static—they can evolve, and through that evolution, they may either gain or lose attributes.

"other-centered"

Stepping outside ourselves, and shifting the focus onto serving others for the good of the greater community.

definitive stakeholders

The only ones who posses all three attributes: power, legitimacy, and urgency. -Have a significant role to play in your organization and must be given priority when it comes to handling their claims.

The most important question when communicating with stakeholders

What is at stake for your stakeholders, and for whom? -it is your responsibility to communicate to stakeholders not only the value derived, but also the potential loss/consequences of your activities, and suggest alternative solutions.

corporate social responsibility vs social entrepreneurship

While CSR has been mostly associated with large companies, it is also important to small to medium-sized companies.

enterprising nonprofits

a form of social entrepreneurship where both the venture mission and the market impact are for social purposes. Profits must be channeled back into the organization.

work integration social enterprise (WISE)

a social enterprise whose mission is to integrate people who have been socially excluded into work and society through productive activity

many social entrepreneurs desire to:

add something to the world

social entrepreneurs measure performance by:

advancing social and environmental goals

wicked problems can occur on which type of scale?

all of these: local, national, and global

according to Bill Drayton, true social entrepreneurs want to:

change the world

Corporate social responsibility

describes the efforts taken by corporations to address the company's effects on the environmental social well-being in order to promote positive change.

what type of thinkers see wicked problems as a challenge to think differently and develop creative solutions

design thinkers

a trade-off that many social entrepreneurs face is one between:

doing good and earning enough money

according to the chapter 4 video lecture on Social Entrepreneurship, Tesla was described as a "social mission" company

false

the hybrid model of social entrepreneurship describes an organization that focuses on domestic and global markets

false

dominant stakeholders (expectant)

have both power and legitimacy, which gives them strong influence in your organization.

Discretionary stakeholders

have no power to influence and no urgent claims, but they have legitimacy.

according to the chapter 4 lecture on social entrepreneurship, the following examples were listed as "wicked problems"

lack of clean water, poverty, child labor

wicked problems are known to have:

no clear solution

demanding stakeholders (latent)

posses urgency attribute; no power or legitimacy and may be the only dissenting voice in the room.

dangerous stakeholders (expectant)

possess both power and urgency but may use this power to coerce or even resort to violence.

venture philanthropy funding features all of the following except:

single year support (it features high engagement, tailored financing, and non-financial support)

how social entrepreneurs can use capital markets to fund their ventures

social entrepreneurs can seek funding from Social Venture Capitalists (SVC) and community-funded venture capital to support operations; microlending is another source of capital available for social entrepreneurs

how social entrepreneurship can help solve wicked problems around the world

social entrepreneurship can help solve wicked problems such as those related to water shortages, education, health care, poverty, energy, forced migration, and global warming by creating innovative solutions that make a real impact on the lives and livelihoods of others

what role social entrepreneurship plays in society

social entrepreneurship is the process of sourcing innovative solutions to social and environmental problems; while many companies strive simply to maximize shareholder value, social entrepreneurs are often more committed to causes centered on preserving and protecting future generations

the value of social inclusion globally within social entrepreneurship

social inclusion is meant to directly confront some of the inequity that creates personal marginalization and its resulting social issues head-on; many individuals will not have some of the same opportunities so common for their peers- many around the world have dedicated their careers to breaking down social issues plaguing society, encouraging inclusion with a heavy dose of hope

the primary attributes of stakeholders and how stakeholders can help or hinder a social entrepreneur

stakeholders are all those involved in and affected by the activities of a social venture; building relationships with key stakeholders is typically important for any entrepreneur, social or otherwise, but often social issues need additional support to gain traction with the majority of stakeholders

stakeholders

the people or groups affected by or involved with the achievements of the social enterprise's objectives. -By identifying your stakeholders, you will be able to better understand the impact of your enterprise's activities on others.

earned-income activities

the sale of products or services that are used as a source of revenue generation

identify the different types of social entrepreneurship

there are 3 primary types of social entrepreneurship: social purpose ventures, social consequence entrepreneurs, and enterprising nonprofits

traditional vs social entrepreneurship

traditional = designed to make money/profit social = measure by impact, make profit, and so good so they can make more money to do good

ethical challenges present some of the most difficult problems for social entrepreneurs

true