What is Social Enterprise?
Social enterprises, unlike the traditional profit maximizing enterprises, do not aim to offer any benefit to their investors, except where they believe that doing so will ultimately further their capacity to realize their social and environmental goals. A social enterprise product addresses a failure in the government or commercial market while it also works to alleviate poverty by providing employment to the underserved demographic to which the failure has effected. (1) The company makes this product or service better available to the needy than the market or charitable distribution is able. The company does this both/either through economic discounts and/or geographic location.
A social enterprise can be structured as a for-profit or a non-profit, and may take the form of a co-operative, mutual organization, a disregarded entity, a social business or a charity organization. (1) In any of these structures the net revenue must flow back into the social mission of the enterprise. A social enterprise must also have a viable plan for self-sustainability.
Why Invest in Social Enterprise?
Social enterprises are highly influential in the alleviation of poverty because they empower the disadvantaged to sustainably solve social problems in their own communities without dependence on aid.
Social enterprises, unlike charities, are self-sustaining. Therefore social enterprise investments are especially influential, the loans can be invested and reinvested over and over. EverGift provides revolving loans, meaning that once the loan is repaid it is recycled as a loan to another social enterprise. By providing a loan for a social enterprise you are helping the poor build the infrastructure they need to provide for themselves.
Sources: (1) Wikipedia
Videos on Social Enterprise:
Muhammad Yunus with the World Economic Forum. Father and visionary of micro-finance and social business:
TEDx A basic explanation. Social + entrepreneurship and how individuals engage:
TEDx How to create an infrastructure to support social enterprise.
Financial Inclusion 2020 Forum: Social enterprises that provide micro-loans with the bottom 2billion in mind allow individuals to become financially independent and secure.
En español: ¿Qué es inclusión financiera? ¿Y por qué es importante?
What is financial inclusion? And why is it important?