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Business Model for Social Entrepreneurship

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In Search of Business Models in Social Entrepreneurship

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Abstract

Social entrepreneurship is known to works toward achieving the developmental goals that are associated with the social and basic needs of the people, suggesting a commonality with sustainable development. Sustainable development is based on the interdependence of environmental, social, and economic systems, and is expected to promote equality and justice through people empowerment. Assuming a synergy between social entrepreneurship and sustainable development, this study draws from the literature to bring the characteristics of social entrepreneurship that can be seen as a strategy to achieve the goals of providing for the basic needs of the people. These characteristics are social value creation, the inclusion of the bottom of the pyramid, social innovation, and market orientation. As essential constituents of the strategy of social entrepreneurship, they suggest bringing sustainable development. This is an exploratory study that aims to develop a conceptual framework for a social entrepreneurship business model that could combine the practices and operational strategies of social entrepreneurship. This conceptual model is based on Hamel’s business model framework and how it operationalizes social entrepreneurship to achieve sustainable development.

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Notes

  1. 1.

    The “base (or bottom) of the pyramid” was first used in a paper written by two University of Michigan professors in 2002. In “The fortune at the bottom of the pyramid,” C K Prahalad and Stuart Hart indicated that the global population is divided into three segments, based on purchasing power parity (PPP). The base of the pyramid customer is defined as those with a PPP of less than $1,500 per year.

  2. 2.

    SELCO Private Limited is a social enterprise established in 1995, providing sustainable energy solutions and services to under−served households (having grid electricity without adequate supply, or not having any electricity at all) and businesses. SELCO aims to empower its customers by providing a complete package of product, service, and consumer financing through grameen banks, cooperative societies, commercial banks, and micro−finance institutions. They create channels for end users to afford systems based on their cash flow. SELCO emerges as a successful social enterprise, which has well−defined strategies that can be studied as a business model.

  3. 3.

    In Europe, the term ‘social economy’ is identified with the third sector comprising of non-profit organizations and organizations in which ‘the material interest of capital investors is subject to limits and in which creating a common patrimony is given priority over a return on individual investment’ (Laville and Nyssens 2001).

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  1. Centre for Study of Change and Development (CSSCD), Institute for Social and Economic Change, Bengaluru, 560103, Karnataka, India

    Neeti Singh

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  1. Ctr Social Entrepreneurship, Tata Institute of Social Sciences, Mumbai, Maharashtra, India

    Samapti Guha

  2. Ctr Social Entrepreneurship, Tata Institute of Social Sciences, Mumbai, Maharashtra, India

    Satyajit Majumdar

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Singh, N. (2021). Business Model for Social Entrepreneurship. In: Guha, S., Majumdar, S. (eds) In Search of Business Models in Social Entrepreneurship. Springer, Singapore. https://doi.org/10.1007/978-981-16-0390-7_2

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