Social Entrepreneurship

Social entrepreneurs create social value through the use of the entrepreneurship model. Social entrepreneurship relates to many business forms but fundamentally exists as a model that organizations are able to use in pursuit of goals directed toward building value for the society within which they are embedded. Organizations built on this model follow closely with the traditional path of entrepreneurship, pursuing perceived opportunities to achieve their goals. The key to understanding social entrepreneurship lies in acknowledging that it transcends traditional business model boundaries and can occur in any sector of business, such as in the private for-profit or not-for-profit sector or in the public sector.

To engage in social entrepreneurship, the organization is typically driven by a social entrepreneur. The social entrepreneur shares many similar skills with the traditional entrepreneur. These shared skills are identified as designing a mission with the core purpose to create and sustain value; pursuing new opportunities to serve the mission; engaging in continuous innovation, adaptation, and learning; acting boldly without being limited by the resources currently available; and exhibiting a level of heightened accountability to the stakeholders affected and for the outcomes as a result of the mission. The distinguishing factor for social entrepreneurs is that they create social value through the use of this model to create economic value.

While the entrepreneurial skill set is very similar between the traditional entrepreneur and the social entrepreneur, there is a large difference regarding their individual value orientation. Social entrepreneurs are more likely to have experienced some sort of transformative experience during their life, which pushes social improvement to the front of their core values. Most social entrepreneurs are also very active in the social sector throughout their lives, beginning at an early age. This social activism is then combined with their entrepreneurial skill set to enable them to pursue their social missions through social entrepreneurship.

Social entrepreneurship can often be confused with other business models or practices that are designed to create accountability to society within the business sector. Two other terms that are sometimes misused are social ventures and social enterprises. Both social ventures and social enterprises are the legal entities that are created as an end result of social entrepreneurship.

It is also useful to distinguish between a social venture and a social enterprise. Most frequently, the term venture is used to describe organizations that are the result of a venture capital investment, but with social ventures this is the result of social venture capital. The term enterprise, on the other hand, is typically associated not with an organization built on venture capital but with one that secured its financing through other means. Regardless of the methods of financing, both social ventures and social enterprises are two possible outcomes of social entrepreneurship. Social entrepreneurship must also be differentiated from terms such as sustainable enterprises, corporate social responsibility, and business ethics. While it is possible for a social venture, or a social enterprise, to practice social responsibility or sustainability, they are different concepts within the same theoretical sphere of social awareness.

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