The Future of Social Entrepreneurship?
Thursday, 22nd November 2012 at 10:22 am
What’s the future of social entrepreneurship? Eli Malinsky, Executive Director of the new Centre for Social Innovation in New York City shares his five predictions including the rise of impact investing.
1.) Social entrepreneurship will dissolve as a distinct discipline
Don’t be alarmed – this is a good thing. Right now, social entrepreneurship is treated as a discipline in its own right. For the moment, this is a welcome situation, drawing attention and resources to the social sector while stimulating new frameworks and new enterprises. But through the coming years we’ll see social entrepreneurship woven into the very fabric of existing disciplines, becoming an integral lens through which we understand all sectors and fields of study. The mainstreaming of social enterprise means its disappearance as a distinct activity and will, ultimately, lead to the systemic shifts necessary for broad-scale social change.
2.) Assumptions of high profit margins will be recalibrated to the realities of mission-based enterprise
Enthusiasm around impact investing continues to grow. And an increasing number of social entrepreneurs are convinced that they can make money and find meaning in their work. The good news is that the social sector will prove that enterprises can be financially sustainable, even profitable. The bad news is that optimistic assumptions around profit margins will encounter a hard reality check. Succeeding in business is very difficult. Succeeding in a business with an integrated social mission is doubly so. Despite the occasional success story, social entrepreneurs and impact investors will have to get used to thinner profit margins that will, generally speaking, have an inverse relationship to social impact.
3.) The greatest social change will be unleashed by moving the corporate needle
The surge of enthusiasm for new social ventures is astonishing. All around us, social entrepreneurs are creating new projects poised for growth and impact. These initiatives are laudatory and necessary – and definitely part of the picture. But the substantive impact we need to avoid catastrophe and reconfigure existing systems will be achieved far more through incremental shifts in corporate behavior than through revolutionary ones in the nonprofit or entrepreneurial sectors.
4.) Social impact assessment will become more sophisticated and fully integrated into organizational analysis
Social impact assessment continues to make strides in measuring and articulating the results of social change projects. As donors and investors demand clarity of impacts in an increasingly crowded market, new models and tools for social impact measurement will continue to be developed. As with the dissolution of social entrepreneurship as a distinct discipline, social impact assessment will no longer be a supplement or alternative to existing tools for organizational assessment, but an integrated and essential feature of any robust product or service analysis.
5.) Impermanence and constant reconfiguration define the career arc of aspiring social entrepreneurs
This should come as no surprise to those who have been observing broader trends in employment and independence. MBO Partners reports that there are nearly 17 million members of America’s ‘independent workforce’, a number predicted to rise to 23 million in the next five years. Social entrepreneurs are not immune to this change in workplace patterns and may be even more susceptible given the emerging and evolving nature of the sector. Individuals planning to make a living through social entrepreneurship should brace themselves for a career marked by frequent changes in employment and a constant reconfiguration of skills and teams, each assembled for different tasks at given times.
You can follow this topic on Twitter using the Hashtag #FutureSocEnt
Eli Malinsky is executive director of the new Centre for Social Innovation in New York City. The Centre for Social Innovation is part co-working space, part community centre and part incubator for entrepreneurial people and projects.
This article was first published by Forbes.com and is republished here with permission.