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Social Entrepreneurs Say They Face Tough Hurdles But Making Headway

  • Reuters

FILE - A clean, efficient cookstove designed for low-cost manufacturing in Africa. The Global Alliance for Clean Cookstoves recently worked with the government of Kenya to eliminate a tax on cookstoves going to women in poor regions.

FILE - A clean, efficient cookstove designed for low-cost manufacturing in Africa. The Global Alliance for Clean Cookstoves recently worked with the government of Kenya to eliminate a tax on cookstoves going to women in poor regions.

Greater support from the public, governments and investors is needed to boost the work of entrepreneurs using business for social good, said industry activists and organizers after a Thomson Reuters Foundation poll highlighted these as key issues.

While progress overcoming those obstacles is healthy and growing, they said at SOCAP - the largest annual conference of social entrepreneurs and investors - that more could be done to support what is seen as a new way of doing business.

The Thomson Reuters Foundation poll of almost 900 social enterprise experts in the world's 45 biggest economies released this week found the vast majority - 85 percent - said the sector was growing.

But nearly 60 percent of experts cited a lack of public understanding, access to investment and selling to governments as the biggest challenges that could hamper growth.

"There's very limited awareness of what social entrepreneurship is," said Dr. Asher Hasan, whose Pakistani-based company Docthers works with corporations in Mexico and Chile to provide insurance to suppliers, factory workers and others in their supply chains.

"They understand traditional philanthropy. They understand capitalism. They don't understand the blend. There's a lot of market development that needs to be done to help the mainstream understand."

A social entrepreneur is typically someone who uses commercial strategies to tackle social and environmental problems, combining social good and financial gain.

Attendees at SOCAP said governments are promoting social entrepreneurship and schools are teaching it, while enterprises are finding fresh, creative ways to obtain credit and financing.

Jennifer Kushell, founder of Your Success Now (YSN), which connects youth with educational and career opportunities, said U.S. President Barack Obama had been supportive, promoting so-called entrepreneurship diplomacy, a strategy to find common goals in conflict areas.

YSN is designing a social entrepreneurship curriculum for business schools, she said.

‘Don’t miss the next Thomas Edison’

"You have a billion-and-a-half young people, and they don't even realize they can be entrepreneurs or realize they can work for entrepreneurial companies," she said. "It does need a lot more people to stand up and try to get the word out much more aggressively, like any movement."

Seeking to support social entrepreneurs, Autodesk, a maker of software for architecture, engineering and other industries, provides free software and licenses, said Pam Hochman, who manages the entrepreneur impact program at the Mill Valley, California company.

"I definitely hear about finance and access to capital being a real problem," she said. "We don't want the next Thomas Edison to walk by, and he didn't get the software that he needed because he didn't have enough money to buy a license."

Banks are training loan officers on the risks involved in lending to social entrepreneurs, said Marina Leytes, a consultant with Impact Alpha, an online media site covering social and environmental business.

"More and more local banks are entering this sector, providing loans to smaller enterprises," she said. "It's a way for them to gain more clients and expand their operations."

The Global Alliance for Clean Cookstoves recently worked with the government of Kenya to eliminate a tax on cookstoves going to women in poor regions, said Stevie Valdez, manager of the Washington-based group's impact investing and market development.

The Alliance aims to provide cleaner cookstoves and fuel to the 40 percent of the world's population that uses solid fuel and cooks over open fires, creating severe environmental and health problems, Valdez said.

"We need the entrepreneurs really getting out there with great products, and we need the governments really making an effort to say, 'You know what? We want healthier products," she said.

Representatives of YSN, Autodesk and the Alliance were among 2,500 people attending SOCAP last week in San Francisco. The conference brings together investors and entrepreneurs to address issues such as poverty, climate change, job creation and food supplies.

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