Last month brought us another great Talk, this time co-hosted by our friends at DC Net Impact, on the nature of social enterprise. We had it at Cause, the new philanthropub, which if you haven’t checked out yet, you need to. Also, we were lucky enough to be there at the same night as Fox 5–check out the video and you’ll see the UnSectored Talk getting ready to start. A summary of the conversation is below.
We are taking this month off from Talks, but we will be back in full force in January with a Talk co-hosted by the American University Washington College of Law and in February with one co-hosted by SPACIOUS. If you want to host a Talk, let us know!
See below for the full summary of the social enterprise Talk.
Summary of “Social Enterprise: What Does it Mean and What Does it Look Like?” co-hosted by DC Net Impact
- Social enterprise is difficult to define. Many participants had different definitions, sometimes conflicting. Some felt that it was an enterprise that generated profit while pursuing a social mission, while others defined it as an organization that worked on sustainably solving underlying social issues. All agreed social enterprises could be either for-profit entities, or non-profit entities, although some thought there needed to be a profit-generation component regardless of the organizational structure.
- The discussion focused on three different components of a social enterprise: The impact of the organization, the intention of the founders, and the overall impact of the organization. Some thought certain components were more integral to a social enterprise than others. For example, some said that an enterprise could have the intention of making a social impact, but if it does not produce positive social value, it isn’t considered a social enterprise. Others said that an organization could produce positive social impact, but if it didn’t have a profit-generating model, it couldn’t be considered a social enterprise.
- There was a general consensus that social enterprises should be focused on creating long-term, sustainable solutions, not just alleviating problems. But for some, that organizational goal alone was not enough to make it a social enterprise.
- There was also a general consensus that social enterprises should be self-sustainable. However, this definition did not exclude nonprofits, even those that rely on donations, as many high-performing nonprofits can maintain (and have maintained) sustainability through grants. This criterion also excluded many for-profit enterprises that are unable to succeed in profit-generating activities.
- Some brought up the concern that there could be a threat to nonprofit social enterprises losing their tax deduction status because of their for profit focus–and on the other side, there was questions around if a for-profit social enterprise could gain some kind of preferential tax status treatment.
- Measurement is an important component of determining what qualifies a social enterprise. There needs to be some sort of measurement of social impact, but this is difficult to develop because consumers are not demanding them, nor basing purchasing decisions off of these numbers.