EXPLORING SOCIAL ENTERPRISE February 19, 2007 BACI aetmanski@plan.ca
Social Entrepreneurs are not content just to give a fish or to teach how to fish. They will not rest until they have revolutionized the fishing industry. Bill Drayton, Founder Ashoka
10 Great Social Entrepreneurs • St. Marguerite d’Youville (Quebec) • Alphonse Desjardins (Quebec) • Rev. Moses Coady (Nova Scotia) • Milton Wong (British Columbia) • Ian Gill (British Columbia) • Nicole Rycroft (British Columbia) • Florence Nightingale (UK) • Maria Montessori (Italy) • Bill Drayton (United States) • Muhammad Yunis (Bangladesh)
Social Enterprise • Earning revenue and achieving social objectives • Often inventing new approaches, creating innovative solutions to deeply rooted problems • Wealth as a means to an end
Social Enterprise Objectives 1. Achieve our social mission and program goals 2. Earn revenue 3. Increases distribution, market, constituency 4. Achieve value and concrete results for our partners
Additional Outcomes • Discipline and Creativity • Accountability (internal) • Influence • Changes the culture of your organization
Questions • Does social enterprise let government off the hook? • Do the values of social enterprise clash with our not for profit values?
Value of Social Enterprise • To diversify funding base • To acquire ‘flexible’ discretionary dollars • To attract new allies and collaborators • To prepare for predicted fiscal crisis (smaller fiscal pie-larger share to health)
Value (cont’d) • To change the ‘psychology’ from victim to agent (from scarcity to abundance) • To utilize untapped resources for social and economic justice • To address the new ‘worthiness’ agenda • To establish an economic power base
Social entrepreneurs • Convert social to economic assets • Unite social and economic justice
$250 million annually Registered Belonging Disability Initiative Savings NO ONE Plan ALONE FUND Pooled Master Trust $40 billion
Qualities of Social Entrepreneur • Risk Taker – breaks free of established ways of thinking & acting • Bias toward action - corrects the course along the way • Shares the credit • Crosses sectoral boundaries - collaborative • Often works quietly behind the scenes • Strong ethical motivation
Assets of Businesses and Corporations • Distribution and Communication Systems • Employee Assistance programs • In kind (printing, mailing) • Personnel • Business Alliances • Donations
Assets of your membership, constituency • Spending patterns • Business opportunities Ex: if Canada captured 1% of US disabled traveler’s market our tourism revenues increase by $2 Billion Ex: Disability Savings Plan: $80 Billion
Assets Memberships (cont’d) • Products and services purchased, needed • Referrals • Resource to EAP • Links (web; newsletter) • Branding • Profile – halo effect • Tax receipts
4 Key Questions 1) What products, services, spending patterns does your membership have that may be of value to others? (companies, professionals, organizations…) 2) Who needs or wants what you have to offer? (Who are your natural partners?)
4 Key Questions (cont’d) 3) Who knows who? (You, your board, your membership, staff, friends…?) 4) How might you use your connections for the benefit of your social enterprise?
Lessons Learned • It’s about relationships • Stick to what you know • Competencies • Capabilities • Constituency • Give it room • Stay focused on mission and margin • Dream big
$80 Billion Registered Belonging Disability Initiative Savings NO ONE Plan ALONE FUND Pooled Master Trust $40 billion
Social Finance – we are not alone • Muhammad Yunis (micro credit pioneer) Nobel Peace Prize • Deutsche Bank with International Agency for Prevention of Blindness - $20 Million investment fund to finance eye care hospitals in developing countries with near market rates of return • $180m securitization of micro-credit program receivables by Grameen Bank, Citibank, KfW and Bangladeshi banks • Milestone achievement of $100m in loans to community finance institutions and social enterprises by Calvert Foundation’s Community Investment Note
Social Finance (cont’d) • Issuance of the UK’s first AAA-rated bond by a charity, (Wellcome Trust) • Issuance of a bond, supported by France’s AFD, by the Kenyan micro-credit organization Faulu, raising $7m • Structuring of a $10m debt facility by the social housing non-profit Common Ground of NYC, involving $2m in unsecured debt from foundations and $8m in senior commercial financing secured by properties acquired by Common Ground
How Money Works – Glossary • investment capital • gift capital • senior and subordinated loans • insured and uninsured deposits • debt-with-equity features • SROI – social return on investment • CSR – corporate social responsibility • structured derivative products • collateralized debt obligation (CDO) • loan guarantees
How Money Works (cont’d) • PRI’s (program related investment) • fixed income securities • real estate mortgages • stock purchases • microfinance • private equity • patient capital • social capital markets • social venture (philanthropy; capital)
Social Finance 21 (national roundtable) Goals: • Improved knowledge and awareness • Partnership and strategy development • Sectoral capacity-building (capital users and providers) • Support for development of social finance instruments, mechanisms, products and services
Resources • www.ashoka.ca Ashoka • www.tidescanada.org Tides Canada • www.enterprisingnonprofits.ca Enterprising Non Profits Program • www.bctsvp.org BC Technology S ocial Venture Partners • www.changemakers.net Changemakers • www.sea-change.org S ea-Change • www.cedworks.com Centre for Community Enterprise • www.csen.ca Canadian S ocial Enterprise Network • www.svpseattle.org S ocial Ventures Partner S eattle • www.socialenterprisemag.co.uk S ocial Enterprise Magazine • www.se-alliance.org S ocial Enterprise alliance • www.svn.org S ocial Ventures Network • www.socialcapitalpartners.ca S ocial Capital Partners • www.socialenterprisemagazine.org S ocial Enterprise Magazine • www.socialedge.org S ocial Edge • www.blendedvalue.org Blended Value • www.coastcapitalsavings.com/ Community Coast Capital Credit Union • www.vancity.com/ vcf Vancity Community Foundation • www.venturesome.org
Resources • David Bornstein, How to Change the World – Social Entrepreneurs and the Power of New Ideas • Richard Steckel, Filthy Rich – How to Turn Your Non Profit Fantasies into Cold Hard Cash • http://www.ashoka.org/news/04november/ (excellent article by Bill Drayton on creating new financial services industry for social entrepreneurs)
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