Why Capitalists Need To Embrace Social Entrepreneurship

Here’s an interesting blog post: Why Capitalists Need To Embrace Social Entrepreneurship

As I understand it, social entrepreneurship means using the entrepreneurial creativity one would use for personal profit in a venture designed to benefit others or fund a particular venture that has social good as the primary aim while maintaining it’s ability to sustain itself based on market dynamics instead of donations and subsidies.

This author describes the difference as whether the social good is active or passive. Any legal business has the potential to provide passive good. A social entrepreneurial venture actively seeks a good beyond the ability of its staff to provide for families or make the occasional donation.

I think it’s important to define terms. Some people think they’re social entrepreneurs because they can dream up new ways to steal money from existing businesses. I once received a newsletter about “Community Wealth”… it was about how local governments could steal the profits of business by new and creative socialism. They considered that “entrepreneurial”.

In my definition also, entrepreneurs create through creative service. At best, socialists only steal through coercive means.

Entrepreneurship, at its base, is the willingness, for profit, to serve a customer in a voluntary transaction. Socialism on the other hand is coercive. It presumes the ability to leech the profits of others and assumes their profitability is automatic, perpetual, and inexhaustible – free for the pickings.

Profits are not automatic though. Profits only come through intelligent and effective service that produces a positive net return on investment after expenses. Anything else is charity to some extent. Charity is fine in it’s place… simply don’t disguise it as “entrepreneurship”.

If a venture can accomplish a particular positive social aim while funding itself through a moral entrepreneurial model, then, to me it’s “social entrepreneurship”.