2. Key Ingredients of a Social
Entrepreneur
+ =
Social Activist Business Social
pioneer Entrepreneur
Copyright 2010 by Raj Melville
3. What Is Social Entrepreneurship ?
Business entrepreneurs change the face of
business
Social entrepreneurs play the role of change
agents in the social sector
Social entrepreneurs create sustainable
solutions that change society for the better
"Social entrepreneurs are not content just to give a fish or teach
how to fish. They will not rest until they have revolutionized the
fishing industry."
Bill Drayton, CEO, chair and founder of Ashoka Foundation
Copyright 2010 by Raj Melville
4. Business and Social Entrepreneurs
Share Common Traits
Strategic thinkers: Like business entrepreneurs, social
entrepreneurs act upon what others miss
Mission driven: Work hard to generate value
Focused: Both entrepreneurs are intensely focused and
hard-driving in their pursuit of a social vision
Resourceful: They are skilled at mobilizing and
motivating resources
Results oriented: Driven to produce tangible results
Challenge Seekers: Tackle major issues, opportunities
or challenges
Perseverance: Continue efforts despite obstacles
Copyright 2010 by Raj Melville
5. SEs Bring New Approaches to
Social Issues
New Design Solutions
Process Redesign – Aravind Eye Care (www.aravind.org )
Product Redesign – Jaipur Foot
Distribution/Logistics – Saafwater www.saafwater.com
Infrastructure/Technology – Grameen Phone
New Business Models
Micro-Finance
Grameen
Cooperatives
SEWA http://www.sewa.org
Muthu Velayutham, Gram Mooligai Co Ltd http://www.new-
ventures.org/arquivos/GramMooligai.pdf
Triple Bottom Line
New Funding Models
Venture Philanthropy
Socially responsible funds.
Calvert Funds
Acumen Fund
Creative Leverage models
Copyright 2010 by Raj Melville
6. Social Entrepreneurship
Non-Profits
Social
Entrepreneurs
Governmental
For Profit Businesses
Organizations
Copyright 2010 by Raj Melville
7. Questions?
Contact me
Raj Melville
Email: rajmelville@gmail.com
Blog: http://blog.ambientengines.com/
Copyright 2010 by Raj Melville
9. The Non-profit Sector
Total US Non Profit Organizations (2006): 1,478,194
904,313 Public Charities
Organizations do not pay federal tax
Donations are tax deductible
109,852 Private Foundations
Created to distribute money to charities or individuals
About 29 % of Americans over the age of 16 volunteered in 2005
In 2004, public charities reported nearly $1.1 trillion in total
revenues
(Source: National Center for Charitable Statistics)
Total charitable giving in the U.S (2007): $306.39 billion, consists
of 2.2 % of GDP
(Source: Giving USA Foundation)
Copyright 2010 by Raj Melville
10. What Challenges do Social
Entrepreneurs tackle?
Social entrepreneurs typically address areas of unmet
social need or social opportunity creation that the
public or private sectors have failed to address
Health
Water/Sanitation
Education
Sustainable Infrastructure: Housing, Communications
Renewable Energy
Environmental Sustainability
Food and Nutrition
Women’s Issues
Sustainable Agriculture & Technology
Also see the UN Millennium Development Goals
http://www.un.org/millenniumgoals/
Copyright 2010 by Raj Melville
11. Examples of Social Entrepreneurs
Grameen
Aravind and Aurolab
Agastya
Additional examples:
“How to Change the World” by D. Bornstein
“The Fortune at the Bottom of the Pyramid” by C. K.
Prahalad
www.Ashoka.org
Copyright 2010 by Raj Melville
12. Grameen
Grameen Bank was started by Prof. Muhammad Yunus
in Bangladesh in 1976 (http://www.grameen-info.org/ )
Social goal was to
Extend banking facilities to poor men and women who otherwise
would not get bank loans
Eliminate the exploitation of the poor by money lenders
Create opportunities for self-employment for the large number of
unemployed people in rural Bangladesh
Currently Grameen has
7.61 million borrowers, 97 per cent of whom are women
2,535 branches in 83,343 villages
Loan recovery rate is 98.24 per cent.
2008 Projected loan disbursement of US $ 874 million
For profit concern generating dividends to borrowers who are
shareholders
Copyright 2010 by Raj Melville
14. Grameen
What did they do differently?
Went after untapped sector
Were willing to take a risk with uncollateralized loans to poor
Focused on women entrepreneurs
Introduced new business processes
No legal paperwork for loans
Created self help groups to ensure repayment thru social
pressure
Simplified loan repayments with weekly meetings for
incremental loan payments
Created competitive product
Set market rates of interest versus usurious money lender
rates
Websites like www.kiva.org and www.microplace.org now allow
individuals to help entrepreneurs by Raj developing countries
Copyright 2010
in Melville
15. Aravind Eye Hospital
Founded in 1976 by Dr. G. Venkataswamy, in Madurai,
India (http://www.aravind.org/ )
A social organization committed to the goal of elimination
of needless blindness through comprehensive eye care
services.
Every year the Aravind Eye Care System
Sees over 2.4 million patients
Does over 200,000 cataract operations, nearly half of them free
Average cost at one hundredth of that in the US.
Doctors conduct over 2000 operations a year, over 6 times the
national average
Aurolab, a manufacturing spinoff, makes interocular
lenses to world class standards at tenth of international
cost ($4-5 versus $100 -$150)
Copyright 2010 by Raj Melville
16. Aravind Eye Hospital
What did they do differently?
Focused on the social objective
"But Aurolab sells the lenses for less, not only because their
costs are lower but because they chose to price them lower –
because our goal is maximizing service rather than
maximizing profit."
Streamlined the entire operation process
Setup as a production line
Increased the utilization of doctors and equipment
Built new multi-tiered pricing models
Cross subsidized free patients with higher charges for those
who could pay
Copyright 2010 by Raj Melville
17. Agastya
Founded in 1999 by Ramji Raghavan in Bangalore, India
(http://www.agastya.org/ )
Non-profit focused on transforming education in India through a
scalable and interactive education model
India, one of the most populous countries, has over 35% illiteracy rate
Rural schools are poorly staffed with teachers with inadequate training
Created a science training center with distributed centers in each
rural district
Developed a new style of interactive teaching
Agastya Mobile Labs take science education out remote schools
Mobile Labs reach over 800 rural teachers and 40,000 students a year
Over 30 Agastya Mobile Labs make it largest science outreach program
in the world
Results show passing rates at Agastya schools up from 40% to
96%.
Having touched over 80,000 teachers and 2.5 million children,
Prime Minister’s National Knowledge Commission has
recommended the ‘Agastya model’ for nationwide dissemination
Copyright 2010 by Raj Melville
19. Agastya
What did they do differently?
Disruptive business model
Developed a unique teaching model
Break the typical mold of teacher/student interaction
Redesigned the supply chain
Took classes out to the student
Matched resources to talent available
High school students as capable instructors
Scales reasonably well
Engage the ‘customer’ i.e. student
Created a product that satisfied both student and teacher’s
needs
Copyright 2010 by Raj Melville
20. Getting Started
Social entrepreneurs play the role of
change agents in the social sector, 1. Define a clear vision around a
by: social issue or challenge
Adopting a mission to create and
sustain social value (not just private 2. Identify market opportunity and
value) define innovative or disruptive
Recognizing and relentlessly solutions
pursuing new opportunities to serve
that mission
3. Build a sustainable business
Engaging in a process of
continuous innovation, adaptation, model
and learning
Acting boldly without being limited
4. Clearly define social impact
by resources currently in hand metrics
Exhibiting heightened accountability
to the constituencies served and for 5. Recruit and attract resources
the outcomes created and volunteers
(Source: The Meaning of Social Entrepreneurship, J.
Gregory Dees)
Copyright 2010 by Raj Melville
21. The Funding Gap
Concept Implement Growth Sustain
Stage Stage Stage Stage
Developing Implement Scale Long Term
Concept and Build Concept Sustainability
Concept
Venture Philanthropists
The GAP
Family Foundations
Corporate Foundations
Government
Echoing
Green Draper New Profit
Richards Skoll
($60K) Schwab ($1 Mill)
($100K)
Foundation
Social Inno
Ashoka
Forum
(Stipend)
Copyright 2010 by Raj Melville
Confidential