Social entrepreneurs strive for both financial sustainability and positive societal change, unlike traditional entrepreneurs whose primary goal is profit maximization. Social entrepreneurship goes beyond conventional business models by laying focus on social and environmental challenges. Social entrepreneurs are individuals or organizations that leverage entrepreneurial principles to develop innovative solutions to societal problems.

Here are some characteristics of social entrepreneurship:

Mission Driven Approach:

Social entrepreneurs are motivated by a clear social or environmental mission. Their business models are designed to create positive change to this social cause through innovation and/or donation to contribute to the greater good.
Innovative Solutions: Social entrepreneurs often employ innovative and creative solutions to tackle long standing societal issues. They look for unconventional, technologically advanced, and new methods to address problems and bring about positive transformation.

Sustainability and Scalability:

Social entrepreneurs are more inclined to test, manufacture and deliver their products in an environmentally conscious manner. This involves fair labor practices, community engagement, and ethical considerations in all aspects of the business process. Sustainable businesses aim to reduce resource consumption, minimize waste, use renewable energy sources, and adopt environmentally friendly practices to mitigate their impact on the planet.
An article from Harvard Business Review suggests that consumer patterns are changing to prioritize sustainable brands. While sustainability was always “nice to have” when purchasing a product, research suggests that sustainability will now become a standard for purchases. This is because consumers are more likely to purchase from brands they trust, and sustainability drives trust. This is further supported by a statistic put out by Forbes, which suggests that the average consumer is four to six times more likely to buy from, support, and advocate for companies with the mission-driven business model that social entrepreneurship promotes.

What impact does social entrepreneurship have on society?

So far, we’ve discussed some key aspects of social entrepreneurship and how applying this business model can lead to higher financial returns. Now, let’s delve into its societal implications and assess its social impact! Social entrepreneurship inspires and enables other entrepreneurs, some from marginalized communities, to pursue their goals while contributing to the economy. Social entrepreneurs who innovate to adopt sustainable practices show the rest of the world that it is possible to earn money in an ethical and responsible manner while contributing to the greater good. Social entrepreneurship calls aspiring entrepreneurs to step up and tackle local and global challenges that need addressing.

Take Jonathan Kumar for example. He is the founder of FoodCircles, which is a system designed to transform excess restaurant food into financial support for local charities dedicated to alleviating hunger. The business model of FoodCircles and many other social entrepreneurs demonstrates the feasibility of discovering an innovative and operational solution to address challenges, ultimately optimizing financial flows within the economy and contributing to increased value on a global scale.