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Social entrepreneurs should take heart

Social entrepreneurs are an unrealised asset in the fight for a more inclusive and prosperous society. Thankfully, there is growing support for their work.

Social entrepreneurs straddle the divide between capitalism and charity, harnessing business savvy to create an organisation with a social purpose.

In the words of author and social entrepreneur, Bill Drayton: “Social entrepreneurs are not content just to give a fish or teach how to fish. They will not rest until they have revolutionised the fishing industry.”

In a country like South Africa, where widespread inequality and poverty go hand in hand, government cannot make headway without partnering with the private sector, including social entrepreneurs. Their drive to change the way things operate, while also generating jobs and income to sustain themselves, gives them a unique leverage to strengthen both the economy and society itself.

Grameen Bank is a good example. It aims to reinvent financing to help micro-enterprises flourish, and so change people’s economic—and thus social—destinies. But it also aims to make enough profit to be sustainable.

Another benefit is that social entrepreneurs have to innovate, and their solutions can frequently be used in conventional businesses.

Rare birds

Perhaps unsurprisingly, these hybrid businesspeople and social activists are rare. Globally, according to a recent study by the Gordon Institute for Business Science, social entrepreneurship involves under 4 percent of the working population. Here’s the kicker: although we fit the profile of a country in which social entrepreneurship should thrive—middle income, industrialised, high inequality and youth employment—under 2 percent of South African adults are involved in social entrepreneurship. There is thus “considerable potential” to improve the support systems social entrepreneurs need, the study says.

These support systems would include easier access to finance, both at start-up and to cope with the irregular cash flow that bedevils this sector, as well as help with the nuts and bolts of business.

At the same time, it must be acknowledged that managing social enterprises is necessarily complex. There is an inherent tension between the demands of running a business and of addressing social issues; in addition, a social enterprise’s workforce is likely to be highly motivated in terms of its social goals, and less amenable to traditional business practices.

Funders are waking up

All of this points to the value that intelligent funding and mentoring could deliver to social enterprises. Funders have a growing awareness of these needs and are aligning their activities accordingly. A range of financing options is on offer, including crowdfunding, entrepreneurship competitions and venture capitalists. There are also many incubators and support organisations.

For all these reasons, the Diageo Empowerment Trust has identified social enterprises as a funding area, and we have been overwhelmed by the impact they aim to make.

Two examples will make the point. Bursarynetwork, the brainchild of Emmanuel Luthuli, is using crowdfunding to allow ordinary South Africans to contribute to tertiary education fees for specific individuals. The hearX Group is midway through a project to provide community-based hearing and vision screening—plus follow-up where needed—to 5 000 preschool and school-going children in Tembisa by August 2019.

These are just two of the many bold ideas for changing the way things are done for the better, and we are excited by the potential we are unlocking. I hope that anyone who is involved in social entrepreneurship, or is thinking of it, will take heart—your work is valued and there is support out there if you take the time to find it.


By Sinethemba Mafanya, Manager Diageo Empowerment Trust SA