6 Social Entrepreneurship Examples and How to Set Up a Social Enterprise
What is social entrepreneurship?
Social entrepreneurship goes beyond profit-making and focuses on positively impacting society, culture, or the environment by identifying, defining, and leveraging opportunities to enhance social wealth by building new ventures or innovatively optimizing existing organizations. A deep sense of purpose drives social entrepreneurs to address pressing issues such as poverty, inequality, environmental degradation, access to education, healthcare, and more.
The British Council’s research in 2022 estimates that the number of social enterprises with business models focused on social and environmental goals worldwide could be around 11 million. The average prevalence rate of broad social entrepreneurial activity among budding entrepreneurs in the start-up phase is 3.2% across 58 economies, with Peru, accounting for 10.1%, and South Korea 0.3%, according to a Global Entrepreneurship Monitor (GEM) study.
Contrary to common misconceptions, social entrepreneurs' businesses are only sometimes non-profit. While their primary focus is creating positive social change, social enterprises may also operate for-profit ventures. However, these entrepreneurs prioritize reinvesting profits into their social mission, ensuring a sustainable and enduring impact.
What is a social entrepreneur?
A social entrepreneur seeks to solve community-based problems through innovative initiatives driven by the desire to create positive societal changes. They prioritize the greater social good over mere profit-seeking and may focus on environmentally-friendly products, underserved communities, or philanthropy.
The number of social entrepreneurs is higher among young professionals aged 18 to 34, as reported in the Youth Social Entrepreneurship and the 2030 Agenda. Countries like Bangladesh, Morocco, and Indonesia had the highest number of social enterprises run by individuals under 24, as revealed in a survey conducted by the British Council in 2022. This demographic’s affinity towards socially-driven businesses can be attributed to the fact that young individuals assign equal value to the benefits of social entrepreneurship companies of generating employment and addressing their community’s societal and development challenges.
Social Entrepreneurship Examples
Here are some social enterprise business examples that we’ve broken down to highlight company models and how they’ve created a social impact:
Founded by Blake Mycoskie, TOMS Shoes pioneered the "One for One" business model. The One for One model means that for every pair of shoes purchased, TOMS donates another pair to a needy child. TOMS' vision today goes beyond shoes, aiming to improve lives through multiple social initiatives to end forced labor, support the visually impaired, create job opportunities in developing countries, and provide sustainable water systems to communities. TOMS has impacted over 100 million lives and donated millions of shoes. In 2022, they committed 55% of their profits to mental health programs and initiatives, 26% to access to opportunity, and 19% to ending gun violence, per the momentum’s sustainability report.
Founded by Muhammad Yunus, Grameen Bank is known for introducing microfinance to empower individuals living in poverty. Grameen Bank, meaning "village or countryside," adopted a new business model to serve people experiencing poverty with microloans. Unlike traditional commercial banks, Grameen prioritizes the poorest households and provides loans without requiring collateral. Borrowers form groups, meet weekly with Grameen bankers, and use social collateral to ensure repayment. In 2001, the bank shifted to a financial service provider for low-income earners, offering flexible loan terms. Grameen emphasizes savings, requiring debtors to save weekly, and provides high-interest pension savings options. Since its inception, Grameen Bank has distributed microloans worth $36 billion to over 10 million borrowers, 97% being women, as reported by the Madras Courier. Their success lies in their adaptable policies, striving for long-term poverty alleviation, and empowering borrowers with trust-based banking. For its efforts, Grameen's founder, Yunus, received the Nobel Peace Prize in 2006 for improving grassroots socio-economic conditions and combating poverty.
Founded by Boyan Slat at age 18, The Ocean Cleanup is an initiative to remove plastic pollution from the world's oceans, aiming to reduce ocean plastic by 90% by 2040. In 2018, they deployed System 001, nicknamed Wilson, a clean-up apparatus that uses massive nets in ocean gyres, in the Great Pacific Garbage Patch that captured two metric tons of plastic. In June 2019, System 001/B was deployed with improvements, successfully capturing smaller plastic and reducing the barrier size. The organization also introduced The Interceptor in 2019 for river cleanup, deploying it in several locations globally. As the Los Angeles Times reported, an Interceptor in LA notably removed 77 tons of trash during the 2023 storm season. In May 2023, they deployed System 03, a more extended barrier with increased mesh size for marine life protection. The Ocean Cleanup continues its commitment to sustainable solutions and marine conservation, significantly impacting plastic pollution.
This company produces ethanol and methanol stoves for markets where people traditionally cook with firewood, charcoal, and kerosene stoves. They have provided 80,000 clean cookstoves, resulting in 23 million accident-free user days, mainly in Africa. The technology is based on a pressureless canister concept, proven successful in Europe and the USA by Dometic Group for over 30 years. This concept leads to cleaner air, improving health, and reducing deforestation and emissions. Over 3 billion people worldwide use solid biomass for cooking, causing air pollution-related illnesses. Using ethanol and methanol stoves eliminates the need for firewood collection and reduces accidents, benefiting families, especially women. Ethanol production from crops and byproducts generates employment, income and increases food production. Alcohol fuels are globally available, easily distributed using existing infrastructure, and contribute to sustainable energy use. CleanCook's technology offers a promising solution to health, environmental, and social challenges associated with traditional cooking methods in developing regions.
Benetech focuses on using technology to improve educational opportunities for underserved groups worldwide, particularly those with learning differences like dyslexia. Through initiatives like Bookshare, an e-book library that allows readers to customize their reading experience by listening to books or reading them in large fonts or braille, they break down barriers and enable diverse learners to thrive. Additionally, Benetech's project, Service Net, acts as an open data exchange platform, facilitating information sharing on social and human services. This initiative fosters collaboration among organizations and agencies, making valuable data accessible. Overall, Benetech has empowered over 1.5 million people to read and learn in ways that work for them and have delivered 20 million or more books to people with disabilities.
Tractor, an agricultural technology company in Nairobi, Kenya, connects tractor owners with smallholder farmers through a farm equipment-sharing app. The world's largest agriculture equipment maker is now its biggest investor, supporting agricultural technology in Africa. Since its launch in 2014, Hello Tractor has attracted 630,000 smallholders, supporting them with 3,000 tractors and combine harvesters. With a pay-as-you-go tractor financing product, funded by a $4.5 million investment from an NGO in 2022, the platform allows farmers and entrepreneurs to become tractor owners, addressing the mechanization gap in African agriculture and providing economic opportunities for tractor owners.
How to set up a social enterprise
Social entrepreneurship offers a unique opportunity to impact society while pursuing business ventures with a purpose. However, selecting the right social entrepreneurship idea that aligns with your passion, values, and potential for impact is crucial for success.
Here are some steps on how to start a social entrepreneurship business:
Step 1: Identify a pressing social or environmental problem: Identify a problem that resonates with your passion and values. Research various issues, consider their scale and potential consequences, and choose one you feel strongly about addressing. Bantani Education’s Co-founder, Rebecca Weicht, was driven by her vision to democratize education for all when she created a platform to teach entrepreneurship.
Step 2: Conduct thorough research: Once you've identified the problem, conduct in-depth research to understand its root causes, existing efforts to address it, and the gaps that still need to be filled. Investigate successful social entrepreneurship ventures and innovative solutions in similar fields. This research will help you gain insights and inspire unique approaches to tackle the issue.
Step 3: Brainstorm innovative and sustainable solutions: With a deep understanding of the problem, brainstorm innovative and sustainable solutions that can create a significant impact using models like human-centered design. Think outside the box and consider how technology, community engagement, or partnerships with other organizations can enhance your solution's effectiveness. Suppose you are developing a solution to address food insecurity; in that case, your innovative idea might involve establishing community-led urban farms that provide fresh produce to underserved neighborhoods while creating job opportunities for residents.
Step 4: Assess feasibility and scalability: Consider resources, funding requirements, potential partnerships, and the long-term sustainability of your enterprise. Determine if your idea can be scaled up to reach a broader audience and make a more substantial impact over time. If your social entrepreneurship idea involves providing clean drinking water in rural areas, assess the availability of resources, local government support, and potential partnerships with NGOs or water filtration companies for scalability.
Step 5: Seek feedback and collaboration: Share your social entrepreneurship idea with like-minded individuals, mentors, experts, and potential beneficiaries. Seek feedback to refine and strengthen your concept. If you plan to start a social enterprise focused on empowering female artisans, seek input from them, women's empowerment organizations, and business mentors who can provide valuable insights.
Step 6: Develop a comprehensive business plan: Your business plan must outline your strategy, target audience, marketing approach, operational plan, financial projections, and expected social impact. A well-structured business plan will guide your venture and attract potential investors and partners. A business idea built on empowering female artisans can highlight how the enterprise will provide fair wages and invest in skill development and training programs to create long-term impact.
Step 7: Take action and launch your venture: Implement your solution, collect data, and measure your outcomes, like costs incurred and the number of lives impacted, and be prepared to adapt and iterate based on real-world experiences and lessons learned.
Social entrepreneurship combines the power of business and innovation with a vital social mission, giving entrepreneurs the potential to create positive and lasting change by addressing societal and environmental challenges. Individuals and organizations interested in broadening their social impact on society must explore current socially-driven businesses and sift through potential social entrepreneurship ideas to get a deeper perspective on existing gaps and gain inspiration to build ventures that make a difference in their communities and beyond.
Are you a government body, business, or university looking to drive innovation in social entrepreneurship?
Futurize can foster collaborations between academic institutions, governments, corporations, and startups to help you build innovation programs to develop new ideas that can create a social impact. Get in touch with us at hello@futurize.studio!
