Although the words “social entrepreneur” might seem new, the Ashoka organization adopted them to describe their mission 20 years ago.1 As Ashoka states, “the job of a social entrepreneur is to recognize when a part of society is stuck and to provide new ways to get it unstuck. He or she finds what is not working and solves the problem by changing the system, spreading the solution and persuading entire societies to take new leaps. Social entrepreneurs are not content to give a fish or teach how to fish. They will not rest until they have revolutionized the fishing industry.
“Identifying and solving large scale social problems requires a social entrepreneur because only the entrepreneur has the committed vision and inexhaustible determination to persist until they have transformed an entire system… The professional succeeds when she solves a client’s problem. The manager calls it quits when he has enabled his organization to succeed.
Social entrepreneurs go beyond the immediate problem to fundamentally change communities, societies, the world.”
If you’ve worked in the nonprofit sector for any length of time, you likely know one or many people like this. Entrepreneurs and entrepreneurial organizations are nothing new to the sector—in fact, they epitomize the core qualities of the nonprofit sector at its best.
What distinguishes entrepreneurial nonprofits? These organizations adopt a mission to create and sustain social value; recognize and relentlessly pursue new opportunities to serve the mission; engage in a process of continuous innovation, adaptation, and learning; exhibit a high sense of accountability to the constituencies served and for the outcomes created; act boldly without being limited to resources currently in hand; aggressively seek diversified funding sources; are in a continuous process of identifying new resources; and build support for the mission from their own passion and excitement.2
As with any organization, nonprofits can become complacent—relying on old thought patterns and structures even as their environments change. This lack of responsiveness is anathema to our purpose as a sector. Perhaps some of the calls for more entrepreneurship in nonprofits are born from frustration over the absence of relevance, responsiveness and effectiveness.
Dick Boone, director of the Tides Foundation Program on Participatory Democracy in Santa Barbara, California, believes the real issues nonprofit leaders should be concerned with are mission clarity and accountability. Are they achieving their mission? Is the mission clear to those who should benefit? Does it need renewal? Boone’s concern about relevancy, responsiveness and renewal extend from mission to strategy. What were the original goals of the strategy? How effective has it been? What has leadership done to ensure its effectiveness?
Constraints: Boone suggests that some of the constraints to nonprofit effectiveness are entrenched bureaucracies unwilling to be flexible and change with the times, the perpetuation of staff mediocrity, egocentric leadership, and inadequate funding to get the job done.
One reason some nonprofits drift into ineffectiveness is because leaders are so consumed with fundraising, especially in small organizations, that they have little time to perform appropriate oversight, nor do they have the proper staff to monitor and ensure program quality.
Such criticisms are quite valid. The attributes of entrepreneurial organizations in the definition above address these issues—being entrepreneurial within a nonprofit organization, therefore, necessitates a deep concern for mission, learning, constituencies, effectiveness, and resourcefulness.
Stellar Examples: My forthcoming book, The New Urban Leaders, documents my recent discussions with a number of young urban leaders in which effectiveness and relevance emerged as the two central unifying elements critical to success. The leaders structure their organizations so that they are disciplined and organic, highly regimented and aggressively adaptable. They must be readily able to identify problems and equipped to take immediate corrective action.
A stellar example of this can be found with social entrepreneurs David Domenici and James Forman, who head the See Forever foundation and the Maya Angelou Charter school in Washington, D.C. They enroll children in the school who are remanded by the juvenile courts. Through an enormous investment of effort, energy and economic capital, children who were once on a path to jail are now headed to college. In order to address the ever-changing needs of these children, and to continue to operate an organization at the highest standards of excellence, the See Forever Foundation performs a delicate, deliberate balancing act. They encourage their kids to “reach for the stars” through a combination of rules and rewards, and their fundraising efforts combine those of a nonprofit and an entrepreneurial business. In short, they must be prepared for any possibility, opportunity, or setback, and the design of their organization must be flexible enough to allow for inclusion of these unexpected adjustments.
As we think about social entrepreneurship within the nonprofit sector, the conversation should be about helping stagnant, rigid, bureaucratic nonprofit organizations find their way back to a more dynamic and reflective way of operating. And driving that learning should be the passion, dreams, and feedback of the organization’s constituents.
1. Founded in 1980, Ashoka supports a network of some 1,100 “social entrepreneurs” operating in 41 nations. Their Web address is (www.ashoka.org).
2. See Greg Dees, Jed Emerson and Peter Economy. 2001. Enterprising Nonprofits: A Toolkit for Social Entrepreneurs. New York: John Wiley and Sons. The book provides a hands-on guide to social enterprise.
Joyce A. Ladner is a senior fellow in the government studies program at the Brookings Institution, former interim president of Howard University, and a former member of the District of Columbia financial control board. Her forthcoming book, New Urban Leaders, profiles nonprofit leaders developing effective solutions to complex inner city challenges. She explores how and why they chose their career paths, what qualities make them especially successful, and how they’re beginning to train the next generation.