Sunday, November 2, 2008

Starting a business, changing the world

One of the key tactics in the effort to disseminate ideas is to associate your ideas with something that people find appealing or that happens to be in vogue at the moment. Social entrepreneurship has been coming into vogue over the past several years. The idea of creating a for-profit enterprise for the purpose of solving a problem or meeting a need in society is catching on as a legitimate career path. This is exactly the kind of thing that proponents of market/civil society solutions to social problems should be getting into and championing. And yet whenever I read an article on social entrepreneurship it invariably is being pursued from a leftish perspective. Where are the classical liberals? Probably wasting time discussing the minutia of the economic theory of how the market can solve problems instead of actually creating the businesses that will solve these problems in the real world. Social entrepreneurship combines entrepreneurship with activism and is the perfect vehicle for championing the ideals of an entrepreneurial liberalism.

"I think many in my generation have lived their entire adult lives with a feeling of helplessness to change the world around them," says David R. Anderson, 25, founder of San Francisco-based Green Options Media, a network of sustainability blogs, and Renewzle, a lead-generation service for clean-energy installers. "The decreasing barriers to starting a business, especially online, have opened up a new world of social change, while at the same time providing an escape from the drudgery of a boring, corporate or otherwise ineffectual job."
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Lara Galinsky, vice president of strategy at Echoing Green, a seed funding organization for social entrepreneurs, points to the prevalence of social entrepreneurship programs at colleges (Each of the top 10 business schools in the U.S. has at least one faculty member teaching the subject.) media attention, and philanthropic business leaders like Bill Gates and Pierre Omidyar.
"Because of their tremendous wealth and exciting philanthropic strategies, they've helped social entrepreneurship take the fast road," Galinsky says.
"The concept has gotten traction because of the popularity and knowledge about entrepreneurship in general, coupled with a growing interest among young people and others to make a real difference in the world," says Elizabeth Gatewood, Ph.D., director of the Office of Entrepreneurship and Liberal Arts at Wake Forest University in Winston-Salem, N.C. "People are more globally focused, have a growing concern about the environment and sustainability, and realize that there is more to life and finding satisfaction than just making money."
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Echoing Green has provided seed grants and technical support to more than 450 social entrepreneurs over the past 20 years. Most of the organizations have been nonprofits, but "this year, we've definitely seen a surge of just straight for-profit, socially focused companies," Galinsky says. "That's a really interesting trend." She says that four of the 20 grants provided in 2008 will go to for-profits.
Galinsky says for-profit social entrepreneurs choose that structure because it makes the most sense for the business--not because they're trying to get rich.
"It's because it's a better model to realize their social mission. I would be hard-pressed to think they were doing it with the motivation of having high infusions of cash for themselves," Galinsky says.
They look at the laws where they're doing business, or if they're better positioned to receive investment dollars rather than philanthropic donations.
Anderson sees the for-profit model of social entrepreneurship as a mainstreaming effort--making "doing good" an everyday reality.
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"I like to say it's a movement. It's not like this is a typical company or brand," Lewis says. "Everybody feels invested. We have retailers who feel like it's their product. Distributors feel like it's their product. Everyone takes ownership in it all the way down to the consumer, which is what I think makes it work."
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"Making money is a necessity that often seems to get lost in companies with socially responsible missions, and I'd be lying if I said striking the balance between making money and creating a values-driven company culture was easy," Anderson says. "But it's not a zero-sum game. Just love what you do, don't be evil and focus on creating the conditions to carry out your company's mission in a sustainable manner. The rest will fall into place."

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