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01 aps 1015 class 1 - intro to and motivations for se - for lecture
1. APS 1015: Social Entrepreneurship
Class 1: Definitions and Motivations for
Social Entrepreneurship
Thursday, May 10, 2012
Instructors:
Norm Tasevski (norm@socialentrepreneurship.ca)
1
6. Š Norm Tasevski
Agenda
â˘âŻ Class Intros
â˘âŻ Syllabus and Class Structure
â˘âŻ Ground Rules
â˘âŻ Defining Social Entrepreneurship
â˘âŻ What motivates the social entrepreneur?
â˘âŻ What did we learn?
â˘âŻ Next week
6
8. Š Norm Tasevski
Class Rules
â⯠Participation - quality, not
quantity!
â⯠No stupid questions (only
stupid answers)
â⯠Respect your classmates â
attend and be punctual!
8
22. Š Norm Tasevski
Other Differences
âSocial entrepreneurs are not content just to give a fish or
Focus on âsystems how to teach fish. They will not rest until they have
thinkingâ and revolutionized the fishing industryâ
âsystems changeâ: Bill Drayton
â(Social entrepreneurs) work in areas where there is partial or
total market failureâŚwhat distinguishes them is that they are prepared
Seek âprofitâ in
traditionally to strike a very different balance when it comes to creating
unprofitable pursuits: value for those who would not normally be able
to afford itâ
John Elkington
David Bornstein: âWhy do you work on the kinds of projects you do? Why donât
you just want to make a lot of money?â
Possess a strong
âethical impetusâ:
Fabio Rosa: âI am trying to build a little part of the world in which I would like to
live. A project only makes sense to me when it proves useful to make people
happier and the environment more respected, and when it
represents a hope for a better future. This is the soul of my
projects.â 22
23. Š Norm Tasevski
Some Definitions
â˘âŻ âSocial entrepreneurs identify resources where
people only see problems. They view the villagers as
the solution, not the passive beneficiary. They begin
with the assumption of competence and unleash
resources in the communities they are servingâ
David Bornstein
â˘âŻ âA social entrepreneur is someone who recognizes
a social problem and uses entrepreneurial principles
to organize, create and manage a venture to
make social changeâ
Wikipedia
23
27. Š Norm Tasevski
What is a Social Enterprise?
â˘âŻ Organizations (non-profit or for-profit) that imbed
both social purpose and business purpose into their
organization
â˘âŻ Returns are both Social (i.e. impact) & Financial (i.e.
profit)
â˘âŻ Key distinguishing factor: How deep social &
business purpose is imbedded
27
31. Š Norm Tasevski
Social Enterprise hasâŚ
Yep
Absolutely
A transaction
A product/service
This oneâs
complicated
Yeah, butâŚ
A goal A legal form
31
32. Š Norm Tasevski
The SE Product/Service
Itâs stillâŚ
ButâŚ
â˘âŻ âSocial benefitâ is added somewhere on the value
chain
32
33. Š Norm Tasevski
What is Social Benefit?
â˘âŻ For our purposes, social benefit may arise when one
attempts to overcome an injustice or inequity in
society that the market, on its own, cannot respond
to
â⯠E.g. creating employment opportunities for individuals that may not otherwise be
employable in the marketplace
â˘âŻ A similar concept â âenvironmental benefitâ
33
35. Š Norm Tasevski
The SE Transaction
Traditional Business Social Enterprise
Customers
Customers
âClientsâ
35
36. Š Norm Tasevski
The SE Goal - Social vs. Financial Purpose
Social Purpose
â⯠Creating a âsocial returnâ by making positive change
within an inequitable social system
â˘âŻ Examples: Reduced Poverty, Improved Literacy
Financial Purpose
â⯠Creating a âfinancial returnâ, usually through the sale of
products/services in the marketplace
Blended Purpose
â⯠Effecting social change by combining social and financial
return
â⯠Also called âBlended Valueâ
36
37. Š Norm Tasevski
Viewing SE Through a âbusiness lensâ
â˘âŻ How you think about cost
â⯠Additional costs borne on business that achieves a social
benefit (how do you incorporate? Valuate it?)
â˘âŻ How you think about investment
â⯠Opportunities to get investment through traditional models,
but because your business is hybrid, the investment needs
to be hybrid (i.e. layering of different financing
mechanisms)
â˘âŻ How you think about success
â⯠Part of the social enterprise motivation is social, so you
need to consider success in a dual lens. How do you
articulate success in both of these spheres?
37
38. Š Norm Tasevski
The Legal Form
â˘âŻ No clearly defined legal form for social enterprise in
Canada
â˘âŻ âForm follows functionâ
Spectrum of Social and Financial Returns
Nonprofit Structure
For-profit Structure
Emphasis on
Emphasis on Nonprofit with Business with
Conventional Social Conventional Financial
Social Return some earned social
Nonprofit Enterprise Business Return
income responsibility
Philanthropic Capital
Commercial Capital
Source: Stanford Social Innovation Review, Spring 2008; Jed Emerson cited as contributor 38
39. Š Norm Tasevski
A testâŚ
I am:
â˘âŻ A retailer Facts:
â˘âŻ Sells goods at rates affordable by low- â˘âŻ $115M raised for charity since 1995
income individuals ($18M in 2009)
â˘âŻ Employs individuals with barriers to
employment â˘âŻ Over 1,000 environmentally-
â˘âŻ Goals: approved products on sale
â⯠92% of imported goods from green â˘âŻ 1700 new jobs created in Canada in
factories 2009
â⯠95% of waste redirected from landfill
â⯠Desire to be supplied 100% by
renewable energy by 2015
Social Enterprise or Not?
39
40. Š Norm Tasevski
A testâŚ
I am:
â˘âŻ A cafĂŠ
â˘âŻ 84% of all coffee ethically sourced (goal of 100% by
2015)
â˘âŻ Supports farmers by a) selling fair trade coffee, and b)
providing loans to coffee growers
â˘âŻ Purchase carbon credits to offset production
â˘âŻ Goals:
â⯠100% of cups to be reusable/recyclable
â⯠Use recycled/renewable materials in cafĂŠ
construction
â⯠Organize a âmonth of serviceâ (employees act as
âchange makersâ in their communities)
Social Enterprise or Not?
Facts:
â˘âŻ Sells approx. 10% of all Fair Trade coffee globally
â˘âŻ Almost 200,000 volunteer hours made by employees worldwide
â˘âŻ Over 53,000 youth supported and engaged in community events
40
41. Š Norm Tasevski
What does this mean?
Social CSR
Enterprise
Social Complexity
Enterprise
41
42. Š Norm Tasevski
What SE is and is Not
Social Enterprise Is Not⌠Social Enterprise IsâŚ
â˘âŻ A fundraising strategy (i.e. a âgiveâ â˘âŻ A business line (i.e. a âsalesâ mentality)
mentality)
â˘âŻ Solely focused on either âcustomersâ â˘âŻ Focused on both âcustomersâ and
or âclientsâ âclientsâ
â˘âŻ Dependent on restricted funds for â˘âŻ Sustainable (ideally âself-sufficientâ)
operations (i.e. not sustainable)
â˘âŻ An event or one-off activity (e.g. â˘âŻ A continuous, market-driven activity
conferences, bake sales)
â˘âŻ Providing value to clients only â˘âŻ Providing value to both âclientsâ and
âcustomersâ (and distinguishing
between both!)
â˘âŻ Quick â˘âŻ A venture that may take several years
to become profitable/sustainable
42
43. Š Norm Tasevski
Some Definitions
â˘âŻ âAn organization or venture that achieves its primary
social or environmental mission using business methods.â
Social Enterprise Alliance
â˘âŻ âBusiness ventures operated by non-profits, whether they
are societies, charities, or co-operatives.â
Enterprising Non-Profits (enp)
â˘âŻ â⌠social mission driven organizations which apply
market-based strategies to achieve a social purpose.
The movement includes both non-profits that use
business models to pursue their mission and for-profits
whose primary purposes are social.â
Wikipedia
43
46. Š Norm Tasevski
Some Definitions
â˘âŻ Internal and external factors that stimulate desire and energy in people to be
continually interested in and committed to a job, role or subject, and to exert
persistent effort in attaining a goal. Motivation is the energizer of behaviour
and mother of all action. It results from the interactions among conscious and
unconscious factors such as the (1) intensity of desire or need, (2) incentive or
reward value of the goal, and (3) expectations of the individual and of his or
her significant others.â
BusinessDictionary.com
â˘âŻ âMotivation is the activation or energization of goal-orientated behavior.
Motivation may be rooted in the basic need to minimize physical pain and
maximize pleasure, or it may include specific needs such as eating and
resting, or a desired object, hobby, goal, state of being, ideal, or it may be
attributed to less-apparent reasons such as altruism, selfishness, morality, or
avoiding morality. Conceptually, motivation should not be confused with
either volition or optimism. Motivation is related to, but distinct from, emotion.â
Wikipedia
46
47. Š Norm Tasevski
In response
to why
people are
not giving to
the Pakistani
flood in the
same way as
they did for
Haiti, one
woman said:!
!
âItâs a rogue
state, if they
can afford
the nuclear
bomb they
can look
after their
ownâ!
!
47
48. Š Norm Tasevski
Costin Militaru, an
outreach workerâŚ
has met addicts as
young as 9 years
old. "His family
had no money for
food. He was
hungry and kept
crying, so they fed
him heroin,"
Militaru says. "If
you're high, you
don't need food.â!
! 48
49. Š Norm Tasevski
âOn March 24, 1989,
the Exxon Valdez
ran aground in
northern Prince
William Sound,
spilling 42 million
liters of crude oil
and contaminating
1,990 kilometers of
shoreline. Some
2,000 sea otters,
302 harbor
seals and about
250,000
seabirds died
in the days
immediately
following the
spill.â! 49
50. A total of Š Norm Tasevski
32,700
different people
stayed in Toronto's
emergency shelters
in 2005. 4,600
were children. !
!
Over half a million
Toronto
households live
below the poverty
line!
!
1 in 10 homeless
report attempted
suicide in 2006!
50
52. Š Norm Tasevski
So What Motivates The Social/
Environmental Entrepreneur?
ââŚit was an epiphanal experienceâŚâ
Ray Anderson, Interface Carpets
53. Š Norm Tasevski
So What Motivates The Social/
Environmental Entrepreneur?
âI heard the same story again and again. Someone had
experienced an intense kind of pain that branded
There was
them in some way. They said, âI hadâ to do this.
nothing else I could do.â
Jody Jensen, Ashoka
54. Š Norm Tasevski
So What Motivates The Social/
Environmental Entrepreneur?
ââŚthat made a real impression on meâŚâ
Jeff Skoll, eBay, Skoll Foundation, etc.
55. Š Norm Tasevski
So What Motivates The Social/
Environmental Entrepreneur?
âI was teaching in one of the universities while the country was
suffering from a severe famine. People were dying of hunger, and I
felt very helpless. As an economist, I had no tool
in my toolbox to fix that kind of situation.â
Mohammed Yunus, Grameen Bank
56. Š Norm Tasevski
So What Motivates The Social/
Environmental Entrepreneur?
ââŚpowerful moments of inspirationâŚâ
Jacqueline Novogratz, Acumen Fund
59. Š Norm Tasevski
Next Week
â˘âŻ 1st deliverable:
â⯠Pick a social/environmental issue (international or
Canadian) from the provided list, andâŚ
â⯠Pick a group of 4-5 (we will finalize groups next week based
on final class numbers)
â˘âŻ Readings
59