"Social Entrepreneurship: Taking Matters into Your Own Hands in an Age of Austerity"
by Rupert Scofield

"Social Entrepreneurship: Taking Matters into Your Own Hands in an Age of Austerity"

 

Rupert Scofield, President and CEO of FINCA International and author of The Social Entrepreneur’s Handbook: How to Start, Build and Run a Business That Improves the World, talks about social entrepreneurship and his experiences as a microfinance pioneer.

 

Global Entrepreneurship Month was celebrated this November, and with growing numbers of new business owners here in the U.S. and around the world, the momentum for entrepreneurship is clear. According to a survey by the Global Entrepreneurship Monitor, nearly 250 million people worldwide are involved in entrepreneurial activity. Findings in a study released by The Kauffman Foundation in 2010 indicate more Americans became entrepreneurs than in any time in the last 15 years. This entrepreneurial boom in the U.S. resulted in the creation of nearly 565,000 new small businesses. Entrepreneurship in the developing world has also risen dramatically over the last decade due to both economic necessity and new opportunity.

 

Entrepreneurship in business drives growth and innovation, but social entrepreneurship applies these principles to a different end: using enterprise to address social problems or remedy “market failures.” The impetus for creating innovative, market-based solutions to solve social and environmental problems is, in many ways, the result of dwindling public resources for social programs. Noting the opportunity for an entrepreneurial approach to addressing some of the toughest societal problems, schools around the country are building robust entrepreneurship programs and course work into their curriculum. I urge students in these programs to ask themselves: What if I took the next step and became a social entrepreneur?

 

This is a daunting question, and I can assure you there is no easy answer to it. But after nearly four decades of making small business “microloans” to women in the world’s poorest communities with my organization, FINCA International, I have developed a view as to what are the most important ingredients for success in social entrepreneurship.

 

Here are five lessons for entrepreneurs who are thinking of taking the plunge into social action:

 

Follow your passion.  Starting FINCA took a lot of hard work, but it was such a labor of love that I never viewed it as a job.  We were on a mission, and our passion and enthusiasm attracted many talented people willing to share their skills and experience.  People, especially recent graduates, often ask me: “Where do I begin?” I answer with a question of my own: “What do you care about?”

 

Be a volunteer.  If you are not quite sure where to begin, volunteer for a non-profit either in the U.S. or abroad.  You will quickly discover whether or not this work is for you, if you’ve picked the right cause, and if you are ready to take the next step toward starting or joining a social enterprise.

 

Walk a mile in their shoes.  Social entrepreneurs feel passionate about something, usually correcting an injustice or helping a group of people who are getting a raw deal and are powerless to do much or anything about it.  But social entrepreneurs shouldn’t just read about their constituency, they need to “walk a mile in their shoes” in order to develop an understanding of their plight.  If you can find an opportunity to get out into “the field” and live in the communities you are trying to help.

 

Build it brick by brick. To operate a successful socially minded organization, you must start as you would with any other business: you need to hone your skills and acquire the necessary experience. You will need to recruit other true believers to your cause. You will need to raise the capital to finance your social business, to make payroll, and to provide the goods and services to the constituency you have identified. How do you accomplish this? Brick by brick. There are no short cuts that I have found, making patience, diligence and creativity the keys to success.

 

Never stop innovating.  The future of social entrepreneurship is limited only by our imaginations and creativity. In many ways, all socially-responsible businesses are moving in this direction. Their employees and shareholders are demanding they be accountable for more than just dragging money to the bottom line—making new approaches to problems a must.  We are in continual dialogue with our clients to identify the new products and services that they most need to build stable, more secure livelihoods. 

 

NOTE: A version of this article originally appeared on the ONE Campaign blog, found here.

"Social Entrepreneurship: Taking Matters into Your Own Hands in an Age of Austerity"