For years, it seemed that people who wanted to do good in the world thought they needed to create a non-profit. Now we are seeing a change as for-profit businesses tackle what were traditionally non-profit goals. Social entrepreneurship is the growing realm of mission driven business enterprises that view financial success as a way to create more and better good. The benefits are total control of how to make an impact and none of the regulation, inefficiency or bureaucracy of a non-profit.
Social entrepreneurship is a big, all encompassing term used in many ways but let’s focus here on for-profit businesses that explicitly factor mission delivery into their bottom line. They aren’t just donating profits or materials to a related issue (e.g., TOMS shoes, Ben & Jerry’s) or practicing corporate social responsibility by recycling, saving energy or giving money to charitable causes. Their business model is structured around providing or supporting products or services that address social or environmental needs.
Mission-driven companies have a lot of choices on how to structure their organization. But some entrepreneurs are deciding that the benefits of the for-profit model (e.g., total control, access to capital) and the disadvantages of nonprofit structure (e.g., cumbersome governance) make straight for-profit the best way to do a lot of good.
The rise of for-profit social enterprise is being reinforced by the parallel rise of impact investing and support; people wanting to do good with their money not through charity but through investing in companies that give a return both in profit and in mission-driven results. Funders, especially younger, high-wealth donors, fund according to measurable impact rather than a fuzzy desire to support the arts or help their community. They believe their dollars will have far more impact through investing in a hybrid nonprofit or a for-profit business.
If you are still not sure what a mission-driven for-profit company looks like, here are four companies for you to emulate that definitely have a social, planet and people based mission in their DNA.
Solo Eyewear: “To live and to give” is the motto that SOLO Eyewear lives by. Visually impaired founder, Jenny Amaraneni, was inspired by Paul Polak’s novel, Out of Poverty, where she discovered the massive amounts of people who don’t have access to eye care could go legally blind. As of today, the company has helped over 13,000 people across 32 countries by giving ten percent of SOLO’s profits to fund preventive eye care surgeries. By empowering others with the gift of eyesight, their efforts are compounded across the nations they affect. The name SOLO sprung from the idea that all it takes is one idea, one person, and one action to change the world.