A guy, Anna knows from university, recently quit his job at a large advertising agency and founded a company with a friend and now produces, no joke, lemonade: They spent some time in the kitchen mixing up ingredients, found a funky Swedish design agency that came up with the bottle and logo design and started a more-or-less "viral" marketing campaign in some of Hamburg's coolest hang-outs to spread the news about their product, called LemonAID.
So far everything is great. However, a few weeks ago, I read an article in the German online newspaper SPIEGEL, that calls the LemonAID creators "Social Entrepreneurs". Social, because all the ingredients are fair-traded. But what the hell exactly is a "Social Entrepreneur"? Let's check Wikipedia:
Social entrepreneurship is the work of a social entrepreneur. A social entrepreneur is someone who recognizes a social problem and uses entrepreneurial principles to organize, create, and manage a venture to make social change. Whereas a business entrepreneur typically measures performance in profit and return, a social entrepreneur assesses success in terms of the impact s/he has on society as well as in profit and return. While social entrepreneurs often work through nonprofits and citizen groups, many are now working in the private and governmental sectors and making a real impact on society.
The main aim of a social entrepreneurship as well as social enterprise is to further social and environmental goals for a good cause. Although social entrepreneurs are often non-profits, this need not be incompatible with making a profit. Social enterprises are for 'more-than-profit,' using blended value business models that combine a revenue-generating business with a social-value-generating structure or component. A social entrepreneur in the 21st century will redefine entrepreneurship as we know it due to their progressive business models.
Now that is interesting. The makers of LemonAID recognized a social problem (Lack of fair trade? Or lack of coolness of fair trade? Or even lack of lemonade?), enjoy the fun of creating their own product and company, and using modern business skills to do something good.
As you may read between the lines, I'm highly skeptical on the moral grounds of such "social entrepreneurs". Isn't doing something good itself abused as a marketing tool? Shouldn't fair trade be the standard instead of something exceptional? The motto of LemonAID is "Trinken hilft!" which translates into "Drinking helps!" - wew, it almost sounds like your rescuing a malnourished African war-victim when having a sip.
Before Social Entrepreneurship there was Corporate Social Responsibility (CSR), which went the other way round: First there is a business, then they needed to be social to keep being attractive for customers (and their own employees). Like Coca-Cola and their water projects. For many reasons, I never really liked "Corporate Citizenship" either.
Finally, there's many a voice that thinks fair trade isn't social at all.
Enough ranting.
I do consider myself a pragmatic, so I guess I do have to recognize something good in all this: Better social responsible companies as irresponsible ones! Also, if being morally good sells a product, society seems to be on the right track. Finally, who ever does anything just because its morally good? Don't we all love travelling and partying as a side-effect of our CISV-involvements? And since I brought up CISV, wouldn't some "Social Entrepreneurship" integrated into our non-profit landscape lead to something good?
Back to LemonAID: I'm quite impressed by the stunt of founding a company that creates a new, sexy softdrink, competing locally with giants such as Coca-Cola and Pepsi. And the taste, by the way, is fantastic.
Update: This sign I found in Zurich last week in front of a Starkbuck's says: "Three ways to improve the future of a coffee farmer". Hmmm...what now....LemonAID or Starbucks Latte?
Very interesting... however, social entrepreneurship isn't only about fair trade with cool design but can be so many other things. One very different example is the concept of micro-credits developed by Muhammad Yunus in India (who is also nobel peace prize laureate of 2006 http://nobelprize.org/nobel_prizes/peace/laureates/2006/press.html ). There is also an organisation, Ashoka, which supports people with great ideas for social entrepreneurship in order for them to be able to fully develop ideas until they are self-sustainable. Reading about the projects and social businesses started by their fellows is also very interesting ( http://www.ashoka.org/fellows ). Could even be a source of inspiration for project-ideas or cooperations (in- and outside of cisv).
I have to say, as wonderful as this "lemonaid" may be, I don't think it's social entrepreneurship, I think it's plain old entrepreneurship recognizing the marketing value of social change. There is a lot of debate about whether that, in the end, will bring about social change because it will be more "cool", but that alone doesn't make the company socially responsible or contributing to a social good. Do part of the profits go to charity? Is the bottle made from biodegradable corn or potato plastic? How far are the lemons shipped before they reach Germany?
It's easier to criticize than to do it better, as always. I think this links back to an earlier post about CISVers starting non-profits and whether CISV would support them. If Lemonaid were made by a CISVer (and a little more about social entrepreneurship), would you say CISV should make a point to buy it? Should we support our members in their for-profit ventures so long as they are also for-good?
@Aninia: You're perfectly right, Social Entrepreneurship obviously goes beyond fair-trade. Micro-credits is a great example for social entrepreneurship in the banking business.
@Sarah: "Old entrepreneurship with social marketing" is exactly what I think this is. Nevertheless, I'm convinced that LemonAID was founded with good intensions, and I'm sure it's not like they thought, "Hey let's add some social value, so that we make more money." They just wanted a product, that they could identify with, therefore the ingredient of social value.
BTW, I've added a picture of a sign I found in Zurich the other days to the post above. The text translates: "Three ways to improve the future of a coffee farmer". "...and the turnover of our Starbucks branch", they should add.
My impression is that there are 2 issues that people tend to confuse:
* Social Responsibility: doing things considering their impact on society. Seems these LemonAID guys are kind of doing that: producing something that at least do not jeopardize other people, if not helping a bit.
* Social entrepreneurship: endeavors which actually are aimed into improving the social context in which they are performed. An example is micro-credit business.
Anyhow I feel all of this is kind of border line with "I make money but I don't feel bad about it", especially in the first case...
I think Social Entrepreneurship can be seen as a branch of CSR. However LemonAid to me looks more as case of CSR itself rather than a perfect example of Social Entrepreneurship;
a social entrepreneur is pursuing a goal that falls within the area of the common good and does so through private means(business methodology). CSR activities in general are ultimatley addressed keeping a private eye (profit)and private means.
This doesn't make one better than the other and nor of them would satisfy someone s mind who s looking for the 100%socially responsible company.Corporates are like people: you might be recycling but then you go to work by car and pollute. You can start buying FairTrade clothes but then you love McDonald.
I don t think the debate (academic and social) is still on what is CSR and what is not. I think it's more on how CSR relates to Sustainability.
But this is probably another topic.
I agree, Ico, that the more interesting discussion is "how social" is a company, and not whether to lable it CSR or Social Entrepreneurship.
I can see advantages of both concepts for society all along the way:
- Companies that implement CSR become more attractive for both customers and employees - so the social impact is a welcomed side-effect while working towards maximizing profit.
- Social Entrepreneurs will have a double motivation to iimprove performance - a social one and a financial one - so it's likely they will be effective.
I've only losely related this post to CISV, but it seems interesting, how CISVers could become social entrepreneurs - inside or outside the organisation.