What’s the difference between social entrepreneurship and plain old entrepreneurship?
The difference between “social entrepreneurship” and “entrepreneurship” can break down quickly. When we’re talking about African students building new web applications to make it easier to send money to families back home, what should we designate that? Entrepreneurship or Social Entrepreneurship? Or does it not matter? Should it perhaps make us wonder if we should instead be holding up that type of work to argue that real entrepreneurship is about the creation of all types of value – not just about financial wealth. In other words, maybe our view should be about the inseparability of “social” from “entrepreneurship,” and perhaps that’s easier to understand in the emerging market context.
At the end of his article on Rwanda and the Infrastructure of the Future, on the excellent Social Entrepreneurship blog at Change.org, Nathanial Whitteman raises an interesting point, namely, at what points do starting a business/ earning money start and stop being social?
A business that sells mosquito nets is providing a product important to the health of his village. But why is this business more social than a woman who sews wedding dresses? Both are providing a necessary service to the community, and both are often marginal (less so in a city). A cybercafe? An accountant? Why is someone who makes and sells artisanal goods to westerners starting a social enterprise, but a thriving dressmaker not?
Is the difference a commitment to non-exploitative labor practices and giving back to the community? If so, most micro and small businesses are social businesses, whether in the developing world or not! They could not continue to exist in their communities if the communities felt exploited.
- Businesses create employment.
- Financial stability creates demands for goods and services.
- B2B services make business easier and more profitable for other businesses.
- Small businesses mean a rising middle class, which means a higher standard of living.
- I’d like to add that investors can pressure governments to improve investment and business environments, including reducing corruption, but I actually don’t know if there’s any research on this or not.
The more I hear “social enterprise,” the more I’m convinced that it’s just a more palatable phrase for, “people are willing to pay for goods and services that make their lives better and this market is not being exploited as well as it could be.”
I’m still not sure what I think about this subject, especially as an entrepreneur in a developping country. I’d love to hear your thoughts on it!