“To Change Something, Build A New Model That Makes The Existing Model Obsolete.” – Carl Frankel Author Of The Art Of Social Enterprise: Business As If People Mattered
Social enterprises are characteristically different from conventional commercial startups in that the core of a social enterprise is the impact it creates. Thus the nature and scale of social impact determines its valuation. That being said there are practically no examples of social startups becoming unicorns. This is because no social startups have achieved the scale their tech counterparts have.
Thus a question that begs an answer is can social enterprises scale their social impact exponentially? The answer is Yes. Social enterprises can create large-scale impact. However the fundamental nature of their impact needs a fresh new approach.
Large scale social impact cannot be achieved by increasing the size of social enterprises but by increasing the number of social enterprises.
We Need More Local Solutions
One of the most basic nature of social impact is that it is based on local context. In a vast country like India where language and traditions change every 100 kilometers, a social impact model needs to be highly customized to benefit local communities. This means taking into consideration local socioeconomic dynamics and local influencers.
In a 2009 TED speech, professor Anil Gupta of Indian Institute of Management, Ahmedabad says, “Scale should not become the enemy of sustainability. There should be a place in the world for solutions that are only applicable in a locality, and yet one should be able to fund them. One of the greatest tragedies we’ve been finding is that investors would often ask “where is the scalable model“? As if need of a community located in a space and time and has those needs only located in those places have no legitimate right to get those needs fulfilled because they are part of this large-scale”.
Santosh More of EduMentum says
“India has more than 1.5 million schools spanned across 29 states with huge cultural differences. It clearly means a ‘one-size-fits-all approach is never going to work. This demands contextual solutions to be designed based on the needs of the geography. Who could design contextual solutions better than local change leaders?”
In conventional sense scalability refers to producing more through automation, innovation, and increasing workforce while bringing down the cost of production per unit. This does not apply to a social enterprise. The greatest strength of a social entrepreneur is to engage with and to understand local communities and their problems. However I am not arguing that a social enterprise cannot be scaled. Its operational model can be replicated across different geographies with local customization.
Haqdarshak is a good example of scaling up with localization. They have created a team of 3200 trained Haqdarshaks across more than 10 states in India. These Haqdarshaks reach out to last mile households to help them benefit from local, state and central govt schemes.
“All these haqdarshaks are essentially entrepreneurs, so they are not on our rolls.”- Aniket Doegar,CEO & Co-founder of Haqdarshak
Collaboration With Other Stakeholders
Large scale social impact cannot be achieved by piecemeal solutions. Most of the problems facing our country in education, healthcare, clean energy, water & sanitation, agriculture and livelihood creation need cross-disciplinary approach. This means social enterprise across different domains need to collaborate to achieve sustainable development.
We need to adopt the analogy that “it takes a village to raise a child”. The whole social impact ecosystem has to work collaboratively and transparently. Best outcome is achieved by leveraging synergies and collaboration from all key and dependent stakeholders.
Let’s say you are a healthcare services startup primarily working in rural communities. You have detailed data on the health profile of your local beneficiaries. Typically, women suffering from respiratory problems are victims of household air pollution caused by mud stoves used in their kitchens. These women can be potential buyers of clean energy products like smoke-free stoves or biogas. You could share this information with social enterprises operating in clean energy space thus collaborating with them in holistically solving real world problems.
Social enterprises can collaborate with big corporations to achieve scale of reach and community networks.
“The fact that both social enterprises and multinational corporations are businesses can help facilitate partnerships that achieve large-scale impact in more sustainable ways, given shared goals around achieving viable business models.” – Yasmina Zaidman, Director, Strategic Partnerships, Acumen
Social enterprises by the very nature of their purpose are not poised to scale exponentially. This means that the most effective way for them to achieve large-scale social impact is to collaborate with each other and with different stakeholders across the impact ecosystem. We need more number of social enterprises and not a few big ones.