I keep hearing about “social enterprise.” What is it and do I need it in my organization?

Yes, social enterprise is indeed a major concept in the nonprofit and business sector with many different interpretations. In the nonprofit sector, social enterprise generally refers to mission related earned income–when a nonprofit organization generates revenue for products, services or programs that are based on the organization’s core competencies and skills. In other words, your organization’s mission. Examples of social enterprise in the nonprofit sector include:

Delancy Street Foundation – Established in San Francisco in 1971, Delancey Street is the country’s leading residential self-help organization for former substance abusers, ex-convicts, homeless and others who have hit bottom. Delancey Street is considered a pioneer of social entrepreneurship development in America–developing business skills to help solve social problems. Since 1972, Delancey Street has created twelve successful ventures that have trained residents in marketable skills, created positive interactions between residents and customers in the community and helped support the organization financially–the best known is the moving and trucking business; however, they also offer catering and event planning, private car service, a print shop and several other income generating services.

Chrysalis – A Los Angeles nonprofit organization that assists homeless and low-income residents find and retain employment. Through a job training program, the organization generates unrestricted income for the organization’s social service programs through Chrysalis Enterprises, a business established in 1991 that provides cleaning, trash removal and staffing services.

Rubicon Bakery – Rubicon started in 1993 as a social enterprise to provide support, employment and training opportunities for former substance abusers, homeless and ex-convicts. Living up to their motto “Treat Yourself, Transform Lives,” Rubicon offers employees training, fair wages, health insurance and most importantly, a way to get their lives back on track.

Starting a social enterprise is just like starting a business and requires a period of time to conduct the necessary research to determine operational viability, market need, competition, investment requirements and other relevant factors, in addition to assuring the relationship to mission or internal capacities (expertise, skills, etc. that can be assigned to the social enterprise). In some cases, social enterprise might be as straightforward as offering an organization’s current services on a sliding scale to clients who do not qualify for fully subsidized services. To learn more about social enterprise in the nonprofit sector, contact The Academies for Social Entrepreneurship.

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