A Shift Towards Social Entrepreneurship

– Contributed by Dr. Stephanie Fernhaber

Violence. Gentrification. Poverty. Affordable housing. Food access. These are just a few of the many social issues being faced here in Indianapolis. And, they do not seem to be going away.

The traditional approach to addressing social issues involves solutions that rely heavily on grant funding. While such efforts can and do provide some relief, it is becoming harder to do so as there is increased competition for the same dollars. Moreover, there is uncertainty year to year as to whether the funding will continue to be available, resulting in some programs that are having an impact to be ended abruptly. Organizations need to commit many hours to applying and re-applying to grants, and if received, making sure that they stay within the grant requirements even if the context has changed since the application was made. This can sometimes result in a lopsided focus on the grant process, rather than where it should be, on its social mission. It can also turn organizations with similar social missions into competitors, rather than collaborators.

Consider an alternative approach that shifts away from a sole reliance on grant funding, to a partial (and in some cases complete) reliance on economically derived revenue. By integrating a solution that pursues a balance of financial and social objectives, there is an increased ability to adapt entrepreneurially and even scale impact. Within marginalized communities, a welcome byproduct is a sense of empowerment in being able to participate in and contribute to the local economy. Rather than give a handout, such a process can give a hand up. This is the essence of social entrepreneurship.

Also known as the double bottom line, social entrepreneurship applies business entrepreneurship to the pursuit of a social and/or environmental mission. As summarized by Dees, social entrepreneurs are considered to play the role of change agents in the social sector by:

  1. Adopting a mission to create and sustain social value (not just private value),
  2. Recognizing and relentlessly pursuing new opportunities to serve that mission,
  3. Engaging in a process of continuous innovation, adaptation, and learning,
  4. Acting boldly without being limited by resources currently in hand, and
  5. Exhibiting a heightened sense of accountability to the constituencies served and for the outcomes created.

Such an approach seems to be the norm within the Kheprw Institute, where a focus on empowerment through social enterprises abounds, as evidenced through KI NuMedia, the Community Controlled Food Initiative, and Express Yourself Rain Barrels. With its emphasis on youth, Kheprw is actively developing the next generation of change agents.

In looking across the greater Indianapolis community, there appears to be an increasing sense of energy surrounding social entrepreneurship as well. Here are just a few examples:

  • Through their retail stores, Goodwill Indy provides both a place for employment and a more affordable way to buy goods. Their entrepreneurial approach allows them to address the mission of “empowering people to increase their independence and reach their potential” through even more ways, including education, health and employment services.
  • RecyleForce offers a variety of recycling services to residents and corporate partners while reducing recidivism by providing life-changing workforce training to formerly incarcerated individuals.
  • Restored Creation is a social enterprise within the Wheeler Mission’s Center for Women and Children. Each handcrafted product tells a story of restoration, and the process helps women develop a transferable skill as well as serving as a therapeutic outlet.

Yet, social entrepreneurship is not as simply as it looks. It requires creativity and innovation to identify ways to address a social issue while bringing in revenue. It means taking calculated risks to pilot new approaches, and being able to learn and pivot when needed. Both business skills and a deep understanding of social issues must be leveraged.

What can Indianapolis, as a community, do to continue moving the needle on social entrepreneurship forward? For starters, the business community and social sector need to come together to learn from each other. Indianapolis would benefit from some sort of social entrepreneurship “hub” to further support our existing social enterprises and facilitate the creation of new social enterprises. Perhaps this is where grant finding could come in, helping new social enterprises lift off.

Indianapolis has a lot of talent and, more importantly, a lot of individuals that care about the social issues impacting our city. Let’s continue to push forward and embrace social entrepreneurship – together.

– Contributed by Dr. Stephanie Fernhaber

Stephanie Fernhaber is an Associate Professor of Entrepreneurship at Butler University. She is also a passionate advocate for social entrepreneurship and recently launched communityINNOVATE.

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