The social enterprise sector is of increasing interest to the students who arrive at business school, I've noticed, and it coincides with a deeper understanding of how business can make a profit while contributing to society—and what governments can do to support this.
But what is a social enterprise—and how can you explore this career route further?
What is a social enterprise?
While there are several definitions, I consider a social enterprise simply to be a business that—while making a profit for the founder—has the main aim of addressing a social or environmental issue. With recent events such as Covid, concerns over the environment, and wars around the world acting as catalysts—and an increasing sense of frustration that we are being let down by our politicians—students are turning to “conscious capitalism” to be part of the solution.
Social enterprises aim to address social problems for vulnerable or underrepresented groups and the environment, ranging from issues such as homelessness, mental and physical health, food security, access to clean water, removing plastic waste, rehabilitating prisoners, to improving education.
What are some examples of social enterprises?
Examples include TerraCycle, a US social enterprise which collects are reuses hard to recycle plastics; The Big Issue, a magazine sold by homeless people in the UK to earn money; Grameen Bank, based in Bangladesh, which provides loans accessible to communities that would otherwise not be eligible; and Barefoot College which provides education, electrification and women’s empowerment in India.
What’s causing a growth in interest in social enterprise?
Thanks to social media, we all have much more awareness of what’s happening in the world, showing us clear problems that need addressing. There has also been more recognition by governments, creating formal legal structures, such as Community Interest Company (CIC) in the UK, and a clearer understanding that unlike a charity, you can still earn a living if you start a social enterprise.
The 17 United Nations Sustainable Development Goals are also a highly publicised focus on some of the most serious social issues affecting the world currently, and a good basis for generating social enterprise ideas.
What skills do social entrepreneurs need?
To be a social entrepreneur you obviously need entrepreneurship skills, but there are some subtle differences between social—and more general—entrepreneurship. The ecosystem in which your social enterprise operates in might be delicately balanced, with your enterprise competing with existing government or council provision, causing it to be diluted. Or your enterprise taking some of the market might prevent a competitor from being able to operate with economy of scale, making provision for those in need more expensive.
Many social enterprises are started by people who have “lived experience” of the problem. Trying to gain this knowledge is an important issue to address. Networking skills to speak to end users, local (or municipal) government, charities, and other social enterprises is vital—you might work on a live project on your course or even doing voluntary work in the area can help.
Your skill in understanding a complex market and sifting reports and data from multiple sources also would be needed to identify the core of the current problem, as would a grasp of costs and finance when setting the balance between your profit and maximising affordable provision.
As a social entrepreneur, you may also need to learn how to tender for central or local government contracts. Learning to scale up can also be challenging—one of the biggest issues is that the ecosystem for provision for those in need even in different cities in the same country can be so different. Unlike a regular business where success is measured by profit, there is also the complexity of differentiating between outputs and outcomes. You can easily measure how many people use your service, but how can you measure accurately the effect it has had on society? And how can you determine whether this was down to your efforts and not to other factors?
How can business students get involved?
At most business schools, you can get involved in social enterprises through your program, or via extra-curricular activities. You may have the option of dedicated social enterprise units or courses, or at least some discussion of social enterprise within general entrepreneurship modules.
I always include social enterprise in my general entrepreneurship units I teach at Alliance. MBA students often have the opportunity to work on a live business project with a social enterprise.
Why is getting involved with business school clubs or competitions a good option?
To develop social entrepreneurship skills or knowledge at business school, you might want to get involved with venture competitions. Harvard Business School has a $75k prize exclusively for social enterprises. The University of Manchester Venture Further competition, for which I am a judge, has a social enterprise category with recent winners including Open Source Policy, Generation Purple, and Bounceback Education.
There are also accelerator programmes and incubation facilities that can help take your idea forward—ZNotes, which emerged from the UCL Hatchery Incubator, provides study notes and materials to students and aims to reduce educational inequality, and has been used by over 5.5 million students.
You can also look for opportunities outside the university—for example Enactus, a worldwide network that encourages students to think about social enterprise, has both national competitions and a World Cup, held in Astana, Kazakhstan in 2024.
Ignite, is a competition aimed at students and recent graduates with the finals held at The Shard in London and a £20k prize won in 2024 by Medily AI. The Hult Prize is a worldwide competition offering the winner $1 million to build their social enterprise.
Even if you don’t end up continuing your social enterprise after you graduate, your entrepreneurship skills will still be highly marketable–and many regular businesses are turning towards the “triple bottom line” (measuring business performance towards people, planet and profit) and social responsibility—which you will be in a great position to contribute towards.
Dr Robert A. Phillips is a senior lecturer in entrepreneurship at Alliance Manchester Business School, University of Manchester. He has a Ph.D. in Biochemistry from the University of Southampton and an M.Sc. in Biotechnology from University College London. He has worked with a range of startups and larger corporates and his current research includes student entrepreneurship and crowdfunding.
