Background on Social Entrepreneurship

What do Jane Addams, Maria Montessori and Muhammad Yunus have in common? All are exemplary social entrepreneurs, leaders who have identified sustainable solutions to social problems that have fundamentally changed society.
Jane Addams founded Hull-House in 1889, a social settlement to improve conditions in a poor immigrant neighborhood in Chicago, then expanded her efforts nationally. Addams gained international recognition as an advocate of women's rights, pacifism and internationalism, and served as the founding president of the Women's International League for Peace and Freedom. Her work ultimately resulted in protective legislation for women and children.

Maria Montessori, the first female physician in Italy, began working with children in 1906 and created a revolutionary education method that supports each individual child's unique development. Montessori schools allow each child to realize his or her full potential by fostering social skills, emotional growth and physical coordination, in addition to cognitive preparation.

Muhammad Yunus revolutionized economics by founding the Grameen Bank, or "village bank," in Bangladesh in 1976 to offer "microloans" to help impoverished people attain economic self-sufficiency through self-employment, a model that has been replicated in 58 countries around the world. 

As the actions of these historical figures illustrate, the term "social entrepreneur" may be relatively new, but the phenomenon is not.

"Social entrepreneurs are not content just to give a fish or teach how to fish. They will not rest until they have revolutionized the fishing industry."
— Bill Drayton, CEO, chair and founder of Ashoka, a global nonprofit organization devoted to developing the profession of social entrepreneurship 

Just as entrepreneurs change the face of business, social entrepreneurs act as the change agents for society, seizing opportunities others miss and improving systems, inventing new approaches and creating sustainable solutions to change society for the better. However, unlike business entrepreneurs who are motivated by profits, social entrepreneurs are motivated to improve society. Despite this difference, social entrepreneurs are just as innovative and change oriented as their business counterparts, searching for new and better ways to solve the problems that plague society.
Social entrepreneurs are:
Ambitious: Social entrepreneurs tackle major social issues, from increasing the college enrollment rate of low-income students to fighting poverty in developing countries. These entrepreneurial leaders operate in all kinds of organizations: innovative nonprofits, social purpose ventures such as for-profit community development banks, and hybrid organizations that mix elements of nonprofit and for-profit organizations.

Mission driven: Generating social value-not wealth-is the central criterion of a successful social entrepreneur. While wealth creation may be part of the process, it is not an end in itself. Promoting systemic social change is the real objective.

Strategic: Like business entrepreneurs, social entrepreneurs see and act upon what others miss: opportunities to improve systems, create solutions and invent new approaches that create social value. And like the best business entrepreneurs, social entrepreneurs are intensely focused and hard-driving-even relentless-in their pursuit of a social vision. 

Resourceful: Because social entrepreneurs operate within a social context rather than the business world, they have limited access to capital and traditional market support systems. As a result, social entrepreneurs must be exceptionally skilled at mustering and mobilizing human, financial and political resources. 

Results oriented: Ultimately, social entrepreneurs are driven to produce measurable returns. These results transform existing realities, open up new pathways for the marginalized and disadvantaged, and unlock society’s potential to effect social change. 

Today, social entrepreneurs are working in many countries to create avenues for independence and opportunity for those who otherwise would be locked into lives without hope. They range from Jim Fruchterman of Benetech, who uses technology to address pressing social problems such as the reporting of human rights violations, to John Wood of Room to Read, who helps underprivileged children gain control of their lives through literacy. They include Marie Teresa Leal, whose sewing cooperative in Brazil respects the environment and fair labor practices, and Inderjit Khurana, who teaches homeless children in India at the train stations where they beg from passengers. 

Whether they are working on a local or international scale, social entrepreneurs share a commitment to pioneering innovation that reshape society and benefit humanity. Quite simply, they are solution-minded pragmatists who are not afraid to tackle some of the world’s biggest problems.