What is social enterprise?
Social enterprise is an emerging field with many varying definitions. Simply put, social enterprise is about solving old problems in new ways. We define social enterprises as “entities that use sound business practices and the power of market demand to create social and/or environmental benefits for a community or region”. They can be for-profit businesses, non-profit programs, and everything in between. While legal structure can vary widely, social enterprises generate revenue through the sale of a product or service that impacts a social or environmental problem.
Why does social enterprise matter?
Social enterprise is an emerging trend in social change work worldwide. Interest in social enterprise comes from several directions at once. Consumers are pushing businesses to incorporate social and economic considerations into their business models, and non-profits are looking for innovative ways to pursue their social or environmental mission. In rural areas in particular, a decline in government resources and philanthropic dollars is forcing leaders and organizations to consider ways to use the power of the marketplace to advance their cause.
Social enterprise is catching on in Appalachia and the rural Southeast. While it is a small segment of the region’s overall economy, we see the acceleration of the social enterprise sector as a crucial driver of economic transition Social enterprises capitalize on growing consumer demand for values-oriented goods and services. They offer an opportunity for the region’s many non-profits with revenue-generating activities to sustain and expand their services and products. For the region’s many entrepreneurs and small businesses with social missions, a social enterprise model makes it possible to make ends meet and begin to fill the gaps in rural social and environmental services. In persistently distressed communities, social enterprises can explore and grow market opportunities that wouldn’t exist otherwise. And by pursuing double or triple bottom line results, social enterprises and social entrepreneurs act as change agents, gradually shifting the region’s economy toward one that promotes sustainability and broadly shared benefits.
This concept paper, developed by Rural Support Partners for the Mountain Association for Community Economic Development (MACED), was supported by the One Foundation. It shares the results of a year of learning about what social enterprise means, including definitions of fundamental concepts and real-life examples from within Central Appalachia.
This research paper provides the background for a research project conducted over several months, shares some core social enterprise concepts, overviews the major interview findings, and lays out a beginning vision for a regional social enterprise support system. This summary report also includes two Appendices: a social enterprise literature review and the interview methodology.