Defining Social Entrepreneurship

The smart folks over at Stanford Social Innovation Review (SSIR) have made a strong case for a rigorous definition of social entrepreneurship. They argue that social entrepreneurship has become so inclusive that it now has an immense tent into which all manner of socially beneficial activities fit. Social entrepreneurship is an appealing construct precisely because it holds such high promise. If that promise is not fulfilled because too many “non-entrepreneurial” efforts are included in the definition, then social entrepreneurship will fall into disrepute, and the kernel of true social entrepreneurship will be lost.

I personally don’t share the authors’ concern that an entire field may fall into disrepute because the tent is too big. Wheat has a way of separating from the chaff.

However, their rigorous definition methodology and the ensuing discussion among the commenters is really useful. For a blog covering the social sector in India, differing definitions and delineations provide a framework within which one can craft a fitment litmus test — for which types of social enterprises to cover and which to exclude. (BTW, this is officially the first time I’ve used the word fitment and I declare myself re-settled in the “Indian English” context.)

It’s tempting to adopt one of the comment’s definition: social entrepreneurship is a lot like porn. I’m not sure I can always define it, but I know it when I see it. But that would be a cop-out.

Now let’s examine the guts of the SSIR Definition:

We define social entrepreneurship as having the following three components: (1) identifying a stable but inherently unjust equilibrium that causes the exclusion, marginalization, or suffering of a segment of humanity that lacks the financial means or political clout to achieve any transformative benefit on its own; (2) identifying an opportunity in this unjust equilibrium, developing a social value proposition, and bringing to bear inspiration, creativity, direct action, courage, and fortitude, thereby challenging the stable state’s hegemony; and (3) forging a new, stable equilibrium that releases trapped potential or alleviates the suffering of the targeted group, and through imitation and the creation of a stable ecosystem around the new equilibrium ensuring a better future for the targeted group and even society at large.

The definition comes across as Newton’s Law of Social Entrepreneurship but hey, the authors did declare that it was going to be a rigorous definition. I thought challenging the stable state’s hegemony was going a bit over the top (perhaps Arundhati Roy drafted that language!) but barring that, I have little reason to disagree with the definition.

Lower Scale = Not Social Entrepreneurship?

In a bid to tighten the definition further, the authors then go on to exclude two groups – social service provision and social activists.

There are two primary forms of socially valuable activity that we believe need to be distinguished from social entrepreneurship. The first type of social venture is social service provision. In this case, a courageous and committed individual identifies an unfortunate stable equilibrium – AIDS orphans in Africa, for example – and sets up a program to address it – for example, a school for the children to ensure that they are cared for and educated. The new school would certainly help the children it serves and may very well enable some of them to break free from poverty and transform their lives. But unless it is designed to achieve large scale or is so compelling as to launch legions of imitators and replicators, it is not likely to lead to a new superior equilibrium.

These types of social service ventures never break out of their limited frame: Their impact remains constrained, their service area stays confined to a local population, and their scope is determined by whatever resources they are able to attract. These ventures are inherently vulnerable, which may mean disruption or loss of service to the populations they serve. Millions of such organizations exist around the world – well intended, noble in purpose, and frequently exemplary in execution – but they should not be confused with social entrepreneurship.

This is possibly the only major area where I disagree with the authors because they are attaching scale and macro-influence (emergence of copycats) as necessary conditions for superior equilibrium (and by consequence their definition of success). The direct implication is that if a social initiative doesn’t succeed (or even likely to succeed) as per the above definition, then the initiative should not be included in the ‘tent’ of social entrepreneurship. Weird at best.

Commenter Jon Griffith articulates the flawed reasoning well. He writes:

This is interesting but unfortunately just completely wrong. The vast majority of entrepreneurs are small. This does not stop them from being entrepreneurs. So it is with social entrepreneurs. The vast majority are small. This does not stop them from being social entrepreneurs. How big or influential they become is entirely irrelevant to their status, as it is with entrepreneurs generally. Treating the extent of their growth or influence as an indicator of their status is a category error, like saying only large buildings with penthouses are really buildings, and my house therefore doesn’t count as a building. Similarly many entrepreneurs fail. This doesn’t stop them being entrepreneurs. So it is with social entrepreneurs. Many will fail. This doesn’t stop them being social entrepreneurs. The above argument applies. There may be some conceivably valid reasons for wanting a definition, such as the one given at the end of the article – that people will be confused if you don’t – but this reason has nothing to do with the size or influence or success of social entrepreneurs.

Commenter Liam builds on Jon Griffith’s points:

I think you’re mistaken. If Skoll Foundation only wants to fund people who can go big, that’s fine. It’s your money. You will need to find and refine ways of better guessing (and that’s all it can be) which of your applicants can get to the scale you want. Fine. But to then so limit the definition of “social entrepreneur” that it only applies to people who get to the scale you define as appropriate is, as we say in London, well out of order mate! Funders have a long track record of wanting to impose their agendas often believing in good faith they know best. To want now to even set limits around the language people use to define themselves is futile and counterproductive. Social entrepreneurship is a continuum and people who get to scale dont always have this as their priority when they start out. They are no less socially entrepreneurial when they start than when they have created mature big impact agencies.

Excluding Social Activism

A second class of social venture is social activism. In this case, the motivator of the activity is the same – an unfortunate and stable equilibrium. And several aspects of the actor’s characteristics are the same – inspiration, creativity, courage, and fortitude. What is different is the nature of the actor’s action orientation. Instead of taking direct action, as the social entrepreneur would, the social activist attempts to create change through indirect action, by influencing others – governments, NGOs, consumers, workers, etc. – to take action. Social activists may or may not create ventures or organizations to advance the changes they seek. Successful activism can yield substantial improvements to existing systems and even result in a new equilibrium, but the strategic nature of the action is distinct in its emphasis on influence rather than on direct action.

Totally agree with the reasons for excluding social activism from the definition. However, one notable exclusion from the definition is sustainability. In my opinion, that’s a more important indicator of true social entrepreneurship than scale and impact.