Sang Lee CEO and Founder, Return on Change | via Huffington Post
The modern era has brought such advancements in medicine, technology and energy that have continued to bring higher quality of life and sustainability for the whole world. However, concurrently we continue to face significant challenges around poverty, disease and accessibility to education just to name a few. We are collectively searching for the ideal solutions, and platforms such as the Youth Assembly at the United Nations are working towards creating fundamental and sustainable solutions that will not only provide immediate alleviations for current issues, but also serve as a spring board for further innovation to create systematic change.
There has been much misunderstanding that social entrepreneurship is nothing but a rebranding of charity and philanthropy. This is a fundamental flaw in the understanding of what social entrepreneurship seeks to accomplish, which is to create sustainable ground level and systematic change for all stakeholders in the world, which includes investors, consumers, community and environment. The public image that social entrepreneurship equates to charity has created difficulty in spreading the concept to the broader industry, but we are definitely moving in the right direction. Social entrepreneurship has the true potential of changing the world on a fundamental scale.
While today’s companies engage in corporate social responsibility, they have limited flexibility and are often unable to deliver high impact results. Large corporations also primarily contribute by means of philanthropy as opposed to sustainable business. Social entrepreneurs think outside of the box and think about disrupting the way issues are dealt with. We’ve seen entrepreneurs developing methodologies to make people ‘invisible’ to mosquitoes to fight the proliferation of disease or creating portable medical devices which allows doctors to provide their expertise to regions of the world that lack access to healthcare. As with other startups industries, social entrepreneurs have the ability to walk away from the established path to create new solutions for what is more often than not an old problem.
Additionally, the current model of philanthropy, while having certain uses has limited impact as compared to social entrepreneurship. Social entrepreneurs are motivated by maximizing the impact they are able to deliver, while concurrently creating a self-sustaining business model that is able to truly benefit everyone. This has the potential to have longer lasting impact as social entrepreneurs do not rely on a donation model, but actually create their own revenue to sustain the business. Financial systems are also evolving in order to promote financial inclusion and the democratization of the capital markets. Crowdfunding all over the globe has breathed new life into entrepreneurship and has facilitated the creation of new impact delivering businesses and the creation of jobs. There have been new regulatory changes such as the JOBS Act which will give everyone the opportunity to invest in community and businesses that they truly care about. Crowdfunding to date has shown that the number one type of campaigns to get funded are for social causes.
I have the honor and privilege of participating in the Youth Assembly at the United Nations this February with various panelists that bring unique and inspiring perspectives on how we could continue to collaborate and brainstorm on leveraging social entrepreneurship to deal with our most pressing issues. It’s also going to be so important that all entrepreneurs bring long term value creation into their business model and thesis. If all of our early stage businesses were simultaneously focused on creating multiple forms of value, we may not even need to have this discussion in the near future.
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