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        <rss:title>Government Engagement</rss:title>
        <rss:link>http://socialedge.org/blogs/government-engagement</rss:link>

        <rss:description>Andrew Wolk, founder and CEO of Root Cause and senior lecturer in social entrepreneurship at MIT, writes on social entrepreneurship and government. This blog features highlights from the Small Business Administration’s 2007 Report to the President and the follow-up paper co-published with the Aspen Institute “Advancing Social Entrepreneurship: Recommendations for Policy Makers and Government Agencies.” Learn more at www.publicinnovators.com.</rss:description>
        

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    <rss:image rdf:about="http://socialedge.org/logo.png">
        <rss:title>Government Engagement</rss:title>
        <rss:link>http://socialedge.org/blogs/government-engagement</rss:link>
        <rss:url>http://socialedge.org/logo.png</rss:url>
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    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/05/13/how-social-entrepreneurship-helps-government-part-ii-testing-developing-solutions">

        <rss:title>How Social Entrepreneurship Helps Government Part II: Testing &amp; Developing Solutions</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/05/13/how-social-entrepreneurship-helps-government-part-ii-testing-developing-solutions</rss:link>       

        

        <content:encoded>
          <![CDATA[
          Despite the best efforts of government, nonprofits, and individual citizens, solutions for social problems can be hard to find. As Gregory Dees notes, &amp;ldquo;With all of our scientific knowledge and rational planning, we still do not know in advance what will work effectively. Thus, progress in the social sphere depends on a process of innovation and experimentation&amp;hellip;an active, messy, highly decentralized learning process.&amp;rdquo;&amp;nbsp; Given the challenges&amp;mdash;and frequent failures&amp;mdash;of attempts to innovate, social entrepreneurs supply a second valuable benefit to government. According to Jeffrey Robinson, assistant professor of management and entrepreneurship at NYU&amp;rsquo;s Stern School of Business, &amp;ldquo;Experimentation is the value of social entrepreneurship to government. How do you break a logjam? Social entrepreneurs are often successful in figuring it out.&amp;rdquo;&amp;nbsp; &lt;br /&gt;
&lt;br /&gt;
Both Benetech and New Leaders for New Schools provide examples of social entrepreneurs helping government benefit Americans by developing solutions, testing new theories, or designing new approaches to addressing social problems. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Benetech&lt;/span&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;Market Failure&lt;/span&gt;&lt;br /&gt;
Twenty years ago, the best available technology for a blind person to read printed text was a machine the size of a clothes dryer with a five-figure price tag. It was an unrealistic and unaffordable option for accomplishing daily tasks like browsing a newspaper or looking over a piece of mail. Although the technology for creating an affordable, portable machine existed, the potential customer base&amp;mdash;blind individuals and their employers&amp;mdash;was too small to promise a traditional return on investment. As a result, technology investors were unwilling to take the risk to develop such a product. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;Transformative, Financially Sustainable Social Innovation&lt;/span&gt;&lt;br /&gt;
Benetech was founded as a low-profit-market approach to ensuring the development of technology that promises to have a high social value despite low potential for generating a typical return on investment. The company&amp;rsquo;s first product, the Arkenstone Reading Machine, makes use of the optical character recognition (OCR) technology found in scanners and can be used with a personal computer to scan and read text aloud. &lt;br /&gt;
&lt;br /&gt;
At a cost of less than $2,000, the Arkenstone Reading Machine quickly found a large customer base. In addition to blind individuals and their employers, people with learning disabilities and government agencies that serve the disabled, including the U.S. Department of Veterans Affairs, began purchasing the product. This expansive customer base helped to generate millions of dollars in revenue annually and ultimately led to the sale of the reading machine and the Arkenstone brand to a for-profit distributor of disabilities products, an example of how a low-profit-market approach can eventually develop a market that could be served by a traditional for-profit approach. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;Societal Benefits&lt;/span&gt;&lt;br /&gt;
Benetech was able to test and ultimately develop a self-sustaining solution to a problem caused by a market failure that government was unable to address. Its inexpensive reading machine, tested in the early stages by accepting below-average returns, ultimately ended up creating a new and profitable market while serving the thousands of Americans&amp;mdash;veterans in particular&amp;mdash;who previously were unable to read printed text on their own. &lt;br /&gt;
&lt;br /&gt;
Next week: &lt;span style="font-weight: bold;"&gt;Testing &amp;amp; Developing Solutions continued - New Leaders for New Schools&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-05-13T17:16:44-07:00</dc:date>

        <dc:modified>2008-05-13T17:16:44-07:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        

        
            <dc:subject>Benetech</dc:subject>
        
        
            <dc:subject>Greg Dees</dc:subject>
        
        
            <dc:subject>Jim Fruchterman</dc:subject>
        
        
            <dc:subject>accessibility</dc:subject>
        
        
            <dc:subject>Social Entrepreneurship</dc:subject>
        

    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/05/06/how-social-entrepreneurship-helps-government-part-i-leveraging-public-private-resources-itnamerica-con-t-from-last-week">

        <rss:title>How social entrepreneurship helps government Part I: Leveraging Public &amp; Private Resources - ITNAmerica (continued from last week)</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/05/06/how-social-entrepreneurship-helps-government-part-i-leveraging-public-private-resources-itnamerica-con-t-from-last-week</rss:link>       

        

        <content:encoded>
          <![CDATA[
          &lt;span style="font-weight: bold;"&gt;Transformative, Financially Sustainable Innovation&lt;/span&gt;&lt;br /&gt;
ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; provides rides in private cars available 365 days a year, 24 hours a day, with &amp;ldquo;door-through-door&amp;rdquo; service using a combination of paid and volunteer drivers. Taking a limited-market approach, ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; charges a nominal one-time membership fee of $35 and about 50 percent of the cost of a taxi for each ride. Payments must be made for every ride, but no money changes hands in the vehicle. Seniors fund personal transportation accounts in advance and receive a monthly statement by mail. &lt;br /&gt;
&lt;br /&gt;
In embarking on an ambitious five-year growth strategy, ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; has been efficient in leveraging private resources. According to founder Katherine Freund, &amp;ldquo;We have a very flexible approach to resources. We say money is one kind of resource, but there are other kinds of assets that have economic value. And if we can find a way to capture different kinds of economic value, then we can use those resources also to pay for rides.&amp;rdquo;&amp;nbsp;&amp;nbsp; Volunteer drivers make up about 40 to 60 percent of the driving team. This helps the organization keep costs manageable, and offers seniors a way to subsidize the cost of their own rides. Many of the volunteers who are over the age of 60 contribute their own volunteer driving time through ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt;&amp;rsquo;s Transportation Social Security program, building up credits in their personal transportation accounts for their own future use while they are still safe and healthy to transport others. Family members also supply volunteer time and make in-kind contributions of their driving credits to their relatives who are using the service. Seniors may trade their personal vehicles when they are no longer able to use them and apply the liquidated equity to fund their personal transportation accounts. The donated vehicles are often used to deliver rides. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Societal Benefits&lt;/span&gt;&lt;br /&gt;
ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; has developed a highly efficient model that ultimately funds itself. When the organization starts an affiliate program in a new city, it limits the amount of public funding it accepts to 50 percent or less of the capital necessary. Moreover, no public funds may be used for day-to-day operations, because ongoing use of public funds crowds out the development of the private community support so essential for long-term sustainability. Freund explains, &amp;ldquo;Most of the resources for transportation are private. If you don&amp;rsquo;t have a model that is built to access them, then you&amp;rsquo;ll fall into the pattern of being one of many providers in a turf war over the public dollars.&amp;rdquo;&amp;nbsp; She notes that while many social problems require ongoing public support, senior transport&amp;mdash;which targets a population willing and able to pay modest fees&amp;mdash;is not one of them. Once ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; affiliates reach their full capacity, the public funding that helped to get them started can be directed to other needs. As a result, ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; leverages minimal initial support from government to meet the transportation needs of older Americans across the country.&lt;br /&gt;
&lt;br /&gt;
Learn how &lt;a href="http://www.publicinnovators.com/resources/case_studies"&gt;KaBOOM!&lt;/a&gt; has leveraged public and private resources to build nearly 2,000 new playgrounds in underserved communities.&lt;br /&gt;
&lt;br /&gt;
Next week: &lt;span style="font-weight: bold;"&gt;How social entrepreneurship helps government Part II: Testing &amp;amp; Developing Solutions&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-05-06T17:13:09-07:00</dc:date>

        <dc:modified>2008-05-06T17:13:09-07:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        

        
            <dc:subject>social entrepreneurs</dc:subject>
        
        
            <dc:subject>government</dc:subject>
        
        
            <dc:subject>hybrid</dc:subject>
        
        
            <dc:subject>accessibility</dc:subject>
        
        
            <dc:subject>nonprofit</dc:subject>
        
        
            <dc:subject>public policy</dc:subject>
        

    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/04/29/how-social-entrepreneurship-helps-government-part-i-leveraging-public-private-resources">

        <rss:title>How social entrepreneurship helps government Part I: Leveraging Public &amp; Private Resources</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/04/29/how-social-entrepreneurship-helps-government-part-i-leveraging-public-private-resources</rss:link>       

        

        <content:encoded>
          <![CDATA[
          As new contributors in the realm of social problem solving, social entrepreneurs have come to serve as resources for government as it addresses social problems to improve the lives of Americans. As Citizens Schools Co-founder and CEO Eric Schwarz explains, &amp;ldquo;The best social entrepreneurs have great results. Government is looking at ways to get results at low costs. Social entrepreneurs can help them achieve this. They can test new ideas and innovations, and partner with government to bring successful ones to scale.&amp;rdquo; &lt;br /&gt;
&lt;br /&gt;
Government leaders continually face pressures to allocate limited tax revenues to address pressing societal needs, and many have achieved a great degree of success. While social entrepreneurs will never take the place of government, conversations with social entrepreneurs and experts in the field suggest that social entrepreneurship is uniquely positioned to help government officials better address societal needs. Specifically, the social entrepreneurs interviewed help government improve the lives of their constituents in two primary ways: (1) leveraging public and private resources and (2) testing and developing solutions. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Leveraging Public and Private Resources: ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt;&lt;/span&gt;&lt;br /&gt;
Because of their focus on financial sustainability, social entrepreneurs identify and utilize new and existing resources, both financial and nonfinancial, to help them address social problems. Often this means that social entrepreneurs are able to implement solutions to social problems on a wider scale that have previously been too costly. At times, social entrepreneurs also end up shifting costs from public budgets to private resources, thus freeing up government tax revenue to address other needs.&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Market Failure &lt;/span&gt;&lt;br /&gt;
ITN&lt;span style="font-style: italic;"&gt;America&lt;/span&gt; provides a good example. Too often, older Americans must choose between their safety and their mobility&amp;mdash;between continuing to drive as their abilities decline or remaining homebound and dependent on others after giving up their cars. Prior attempts to address this problem have failed to fully meet the needs of their target senior consumers. Senior transportation programs, often government funded, have typically relied on attempts to convince older people to ride buses or subways; on organizing volunteers to pick up vanloads of seniors for group trips; or offering rides to a handful of specific destinations, such as medical appointments. Finding these options insufficient, many seniors continue to drive when they are no longer fit to operate a vehicle, or become increasingly housebound as they restrict their own driving and become dependent on favors from family and friends. As ITN&lt;span style="font-style: italic;"&gt;America &lt;/span&gt;Founder Katherine Freund explains, &amp;ldquo;Depending on the private automobile for transportation is inadequate for years before people actually stop driving. And then people who do stop driving outlive that decision by about ten years. It&amp;rsquo;s a very big problem because of the aging of the population. There are more older people. There are more older people living longer. There are more older people outliving the ability to drive longer. You can see if you multiply those things together you come up with a pretty big social problem.&amp;rdquo; &lt;br /&gt;
&lt;br /&gt;
Next week: &lt;span style="font-weight: bold;"&gt;Leveraging public &amp;amp; private resources, continued:&amp;nbsp; ITN&lt;span style="font-style: italic;"&gt;America&amp;rsquo;&lt;/span&gt;s solution&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-04-29T12:00:17-07:00</dc:date>

        <dc:modified>2008-04-29T12:00:17-07:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        

        
            <dc:subject>social entrepreneurs</dc:subject>
        
        
            <dc:subject>nonprofit</dc:subject>
        
        
            <dc:subject>partnerships</dc:subject>
        
        
            <dc:subject>accessibility</dc:subject>
        
        
            <dc:subject>government</dc:subject>
        

    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/04/22/case-study-of-a-no-market-approach-to-reducing-recidivism-resolve-to-stop-the-violence-program-rsvp">

        <rss:title>Case Study of a No-Market Approach to Reducing Recidivism: Resolve to Stop the Violence Program (RSVP)</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/04/22/case-study-of-a-no-market-approach-to-reducing-recidivism-resolve-to-stop-the-violence-program-rsvp</rss:link>       

        

        <content:encoded>
          <![CDATA[
          &lt;span style="font-weight: bold;"&gt;Market Failure&lt;/span&gt;&lt;br /&gt;
U.S. recidivism rates are at about 60 percent throughout the nation.&amp;nbsp; While reducing these rates would produce significant societal benefits by reducing the overall prison population, cutting down on incarceration costs, and ultimately ending up with more productive citizens, there is little hope of a market-based solution to meeting this need. Prisoners have little ability to pay. RSVP, a San Francisco&amp;ndash;based government initiative housed in the city&amp;rsquo;s sheriff department, provides an example of a social-entrepreneurial initiative addressing a no-market opportunity.&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt; Transformative Innovation&lt;/span&gt;&lt;br /&gt;
Dissatisfied with traditional approaches to prisoner rehabilitation, a diverse planning committee of former offenders, crime victims, and community leaders participated in the development of the RSVP model.&amp;nbsp; Explains program administrator Sunny Schwartz, &amp;ldquo;We had victims&amp;rsquo; rights advocates; formerly abusive men and gang members; orthodox rabbis, Baptist ministers, atheists; and deputy sheriffs from line staff to upper echelon. And then the usual stakeholders&amp;mdash;probation and people on the bench.&amp;rdquo; &lt;br /&gt;
&lt;br /&gt;
The resulting program differs from the usual approaches by encouraging and teaching offenders to take responsibility for their crimes. The program also includes a class that teaches offenders to experience empathy for those who have been harmed by violence. Victims of crimes work with former offenders and community stakeholders to develop the curriculum used for these classes and to participate as trainers. When offenders are released from prison, many participate in an &amp;ldquo;internship&amp;rdquo; program and receive employment training while performing restorative acts in the community. Those who are successful eventually return to the prison as facilitators of RSVP sessions. Some of the victims of the RSVP participants become advocates and work with RSVP.&lt;br /&gt;
&lt;br /&gt;
RSVP&amp;rsquo;s results thus far indicate that the organization is on its way to developing a rehabilitation method for violent offenders that has the potential to transform current practices in U.S. prisons. An independent, quantitative evaluation of RSVP found that the average annual incidence rate for fights and other forms of in-prison violence for their program participants is essentially zero, compared with 28 in a traditional &amp;ldquo;lock-up&amp;rdquo; prison setting&amp;mdash;even though the participants sleep in open dorms. Further, offenders who participated in the program for at least eight weeks had a 46 percent lower rate of re-arrest for violent crime than those who served their time in a traditional jail. This difference increased to 83 percent for those who completed at least 16 weeks of the program.&amp;nbsp;&amp;nbsp; Governments and organizations around the country and world have approached RSVP for advice on replicating the program, some of which has already begun. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt; Financial Sustainability&lt;/span&gt;&lt;br /&gt;
For no-market approaches, achieving financial sustainability requires full subsidies in order to start and maintain the initiative. One option in no-market conditions is to work within the government, where public funding is available. RSVP, whose staff is made up entirely of public employees, was able to secure predictable funding with a line item in the City of San Francisco&amp;rsquo;s budget.&lt;br /&gt;
&lt;br /&gt;
Read additional case studies about Triangle Resident Options for Substance Abuse (TROSA)&amp;rsquo;s limited-market approach and Outside The Classroom&amp;rsquo;s low-profit market approach in the &lt;a href="http://www.rootcause.org/knowledge_sharing/articles/social_entrepreneurship_and_government"&gt;full chapter&lt;/a&gt;.&lt;br /&gt;
&lt;br /&gt;
Next Week: &lt;span style="font-weight: bold;"&gt;How social entrepreneurship helps government Part I: Leveraging Public &amp;amp; Private Resources&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-04-22T08:53:27-07:00</dc:date>

        <dc:modified>2008-04-22T08:53:27-07:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        


    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/04/15/definition-part-iii-financial-sustainability">

        <rss:title>Definition Part III: Financial Sustainability</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/04/15/definition-part-iii-financial-sustainability</rss:link>       

        

        <content:encoded>
          <![CDATA[
          Social entrepreneurship - the practice of &lt;span style="font-style: italic;"&gt;responding to market failures&lt;/span&gt; with &lt;span style="font-style: italic;"&gt;transformative&lt;/span&gt; and &lt;span style="font-style: italic;"&gt;financially sustainable&lt;/span&gt; innovations aimed at solving social problems. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Financial Sustainability&lt;/span&gt;&lt;br /&gt;
While social entrepreneurship is not defined by any one standard model for achieving financial sustainability, working toward financial sustainability is essential if an approach to a social problem caused by market failure is to be successful enough to have transformative potential. Each organization must find a model responsive to the unique character of the social problem they are trying to solve, and grounded in the realities of the type of approach to market failure they have adopted. Social entrepreneurs also tend to prefer business-like productivity and efficiency measures to determine their capture and use of resources. Many produce cost-benefit analyses, reports on &amp;ldquo;social&amp;rdquo; return on investment, report cards on organizational performance, or other integrated measures of financial and programmatic success that will ultimately help the organization optimize their use of resources and maximize their results.&lt;br /&gt;
&lt;br /&gt;
While the details vary, such financial models generally include two components: nonfinancial resources and predictable revenue sources.&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;&lt;span style="font-style: italic;"&gt;Nonfinancial resources&amp;nbsp;&lt;/span&gt;&amp;nbsp;&amp;nbsp; &lt;/span&gt;&lt;br /&gt;
These are skilled or unskilled volunteers, and one-time or recurring in-kind donations that enable social entrepreneurs to increase the sustainability of their initiatives.&amp;nbsp; For instance, David Eisner CEO of the Corporation for National and Community Service points out that &amp;ldquo;Engaging the public in developing and implementing social solutions is a proven and inexpensive strategy. Look at the way nearly 600,000 volunteers were leveraged to complete intensely needed work in the year after Hurricane Katrina in a way we never could have paid for.&amp;rdquo;&amp;nbsp; &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;Predictable revenue sources&lt;/span&gt;&lt;br /&gt;
These are long-term, repeat, and performance-based funding sources&amp;mdash;foundation, individual, government, corporate, and fee-based&amp;mdash;that will provide predictable funding, despite conditions of market failure. Which type of predictable revenue sources a financial sustainability model contains will depend on the organization&amp;rsquo;s approach to market failure, as well as the social problem being addressed. No-market approaches will look for long-term, repeat, and performance-based funding sources, and may also develop an earned-income venture to build into the model an alternative to receiving income from the direct beneficiary. Limited-market approaches will focus on the same funding sources as no-market approaches, in addition to collecting a portion of their costs from the beneficiaries of their product or service. Low-profit-market approaches will ask the beneficiary to pay, and look for &amp;ldquo;patient capital&amp;rdquo; from socially motivated investors who are willing to accept below-market returns, or wait for profits while the market is developed, in exchange for social impact. &lt;br /&gt;
&lt;br /&gt;
I&lt;span style="font-weight: bold;"&gt;n summary,&lt;/span&gt; social entrepreneurship provides a solution that has great potential societal benefit, but little hope of generating the profits required by traditional for-profit companies. Social entrepreneurs&amp;mdash;adopting no-market, limited-market, and low-profit-market approaches&amp;mdash;address these problems while striving for what can be considered a different kind of profit: the generation of new and transformative solutions to the nation&amp;rsquo;s most pressing social problems.&amp;nbsp; Next week, we&amp;rsquo;ll look at a case study of the Resolve to Stop the Violence Program (RSVP), a no-profit approach to lowering recidivism rates. &lt;br /&gt;
&lt;br /&gt;
Next Week: &lt;span style="font-weight: bold;"&gt;Case Study of a No-Market Approach: Resolve to Stop the Violence Program (RSVP)&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-04-15T13:25:38-07:00</dc:date>

        <dc:modified>2008-04-15T13:25:38-07:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        

        
            <dc:subject>government</dc:subject>
        

    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/04/08/definition-part-ii-transformative-innovations">

        <rss:title>Definition Part II: Transformative Innovations</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/04/08/definition-part-ii-transformative-innovations</rss:link>       

        

        <content:encoded>
          <![CDATA[
          Social entrepreneurship - the practice of &lt;span style="font-style: italic;"&gt;responding to market failures&lt;/span&gt; with &lt;span style="font-style: italic;"&gt;transformative &lt;/span&gt;and &lt;span style="font-style: italic;"&gt;financially sustainable&lt;/span&gt; innovations aimed at solving social problems. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Transformative Innovations&lt;/span&gt;&lt;br /&gt;
Ashoka Founder Bill Drayton has famously commented that &amp;ldquo;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.&amp;rdquo;&amp;nbsp; Like other entrepreneurs, social entrepreneurs are creative thinkers, continuously striving for innovation, which can involve new technologies, supply sources, distribution outlets, or methods of production.&amp;nbsp; Innovation may also mean starting new organizations, or offering new products or services.&amp;nbsp; Innovative ideas can be completely new inventions or creative adaptations of existing ones.&amp;nbsp; &lt;br /&gt;
&lt;br /&gt;
Many scholars take this focus on innovation even further. Social entrepreneurs are &amp;ldquo;change agents,&amp;rdquo;&amp;nbsp; creating &amp;ldquo;large-scale change through pattern-breaking ideas,&amp;rdquo;&amp;nbsp; &amp;ldquo;addressing the root causes&amp;rdquo; of social problems,&amp;nbsp; possessing &amp;ldquo;the ambition to create systemic change by introducing a new idea and persuading others to adopt it,&amp;rdquo;&amp;nbsp; and changing &amp;ldquo;the social systems that create and maintain&amp;rdquo; problems.&amp;nbsp; These types of transformative changes can be national or global. They can also often be highly localized&amp;mdash;but no less powerful&amp;mdash;in their impact. Most often, social entrepreneurs who create transformative changes combine innovative practices, deep and targeted knowledge of their social issue area, applied and cutting-edge research, and political savvy to reach their goals. For all entrepreneurs, whether in the business or social realm, innovation is not a one-time event&amp;mdash;but continues over time. &lt;br /&gt;
&lt;br /&gt;
Of course, while addressing a social problem with a potentially transformative innovation is an essential component of the definition of social entrepreneurship offered here, succeeding in generating such transformation is not. The field, like any other, includes success stories and strong leaders, as well as those who fall short of their aspirations.&amp;nbsp; Nonetheless, the definition of social entrepreneurship requires that initiatives at least have the potential for transformative social innovation on a local, national, or global scale. This characteristic distinguishes social entrepreneurship from other nonprofit, business, or government service providers that may be more narrowly focused on meeting the most pressing social needs as they emerge. &lt;br /&gt;
&lt;br /&gt;
Next Week: &lt;span style="font-weight: bold;"&gt;Definition Part III: Financial Sustainability&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-04-08T07:17:26-07:00</dc:date>

        <dc:modified>2008-04-08T07:20:39-07:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        

        
            <dc:subject>Bill Drayton</dc:subject>
        
        
            <dc:subject>public policy</dc:subject>
        
        
            <dc:subject>Business Models</dc:subject>
        
        
            <dc:subject>government</dc:subject>
        
        
            <dc:subject>Social Entrepreneurship</dc:subject>
        
        
            <dc:subject>for-profit</dc:subject>
        
        
            <dc:subject>Innovation</dc:subject>
        
        
            <dc:subject>nonprofit</dc:subject>
        
        
            <dc:subject>Ashoka</dc:subject>
        

    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/04/01/definition-part-i-response-to-market-failures">

        <rss:title>Definition Part I: Response to Market Failures</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/04/01/definition-part-i-response-to-market-failures</rss:link>       

        

        <content:encoded>
          <![CDATA[
          Social entrepreneurship - the practice of &lt;span style="font-style: italic;"&gt;responding to market failures &lt;/span&gt;with &lt;span style="font-style: italic;"&gt;transformative&lt;/span&gt; and &lt;span style="font-style: italic;"&gt;financially sustainable &lt;/span&gt;innovations aimed at solving social problems&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Response to Market Failure&lt;/span&gt;&lt;br /&gt;
The social problems that social entrepreneurs address result from market failures&amp;mdash;in which profitable markets are unavailable, insufficient, or underdeveloped and where the potential monetary gains for responding to a societal problem are less than the overall, society-wide positive impact of that response. Because of the lack of opportunity to generate profit, private-sector entrepreneurs&amp;mdash;who succeed by finding market opportunities and maximizing profits&amp;mdash;often leave these needs unaddressed. Traditionally, government responds in such cases by deploying public funds to address the unmet needs. &lt;br /&gt;
&lt;br /&gt;
Social entrepreneurship presents another option. Like private-sector entrepreneurs, social entrepreneurs seek opportunities to create value&amp;mdash;but the value they pursue is social rather than purely economic. As Gregory Dees explains, &amp;ldquo;Markets do not do a good job of valuing social improvements, public goods and harms, and benefits for people who cannot afford to pay. These elements are often essential to social entrepreneurship. That is what makes it social entrepreneurship.&amp;rdquo;&amp;nbsp; Roger L. Martin and Sally Osberg echo this idea that social entrepreneurs can be considered entrepreneurs who pursue social value: &amp;ldquo;Unlike the entrepreneurial value proposition that assumes a market that can pay for the innovation, and may even provide substantial upside for investors, the social entrepreneur&amp;rsquo;s value proposition targets an underserved, neglected, or highly disadvantaged population that lacks the financial means or political clout to achieve the transformative benefit on its own.&amp;rdquo; &lt;br /&gt;
&lt;br /&gt;
Through interviews with leading social entrepreneurs and conversations with experts in the field, the author has identified three different types of approaches that social entrepreneurs take in targeting beneficiaries and responding to market failures (Figure 3).&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;No Market &lt;/span&gt;&lt;br /&gt;
In a no-market approach to solving a social problem, the beneficiaries of the potential product or service will not be able to pay for it.&amp;nbsp; As a result, a social entrepreneur who selects such an approach cannot rely on any earned revenues from the beneficiary to sustain the initiative. Most commonly, no-market approaches take the form of government initiatives or nonprofit organizations. &lt;br /&gt;
&lt;br /&gt;
Market-Failure Continuum of Social-Entrepreneurial Approaches to Solving Social Problems&lt;br /&gt;
&amp;nbsp; &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;Limited Market&lt;/span&gt;&lt;br /&gt;
In a limited-market approach, the beneficiaries or clients have some ability to pay. As a result, a social entrepreneur who selects such an approach can rely on some earned revenues from the beneficiary to sustain the initiative. Most commonly, limited-market approaches tend to be nonprofit organizations. &lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold; font-style: italic;"&gt;Low-profit Market&lt;/span&gt;&lt;br /&gt;
In a low-profit-market approach, the beneficiary has the potential to pay the full cost while solving the social problem and thus has the potential to generate a profit. However, the market may be underdeveloped, or investments in this market may yield returns that are less than typical for for-profit ventures. Examples of this type of approach exist in both the nonprofit and private sectors. In some cases, low-profit-market approaches eventually develop the market for a product or service enough that they become traditional for-profit enterprises.&lt;br /&gt;
&lt;br /&gt;
&lt;span style="font-weight: bold;"&gt;Next Week: Definition Part II: Transformative Innovations&lt;/span&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-04-01T06:37:02-08:00</dc:date>

        <dc:modified>2008-04-01T06:37:02-08:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        


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    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/03/25/the-blurring-of-sectors-social-entrepreneurship-emerges-at-the-nexus-1">

        <rss:title>The Blurring of Sectors: Social Entrepreneurship Emerges at the Nexus</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/03/25/the-blurring-of-sectors-social-entrepreneurship-emerges-at-the-nexus-1</rss:link>       

        

        <content:encoded>
          <![CDATA[
          &lt;br /&gt;
&lt;p&gt;Traditionally, each of the three sectors maintained distinct roles and approaches&amp;mdash;with the private sector focused on profitable markets, the public sector solving market failures, and the nonprofit sector engaging citizens in meeting societal needs. &lt;br /&gt;
&lt;br /&gt;
&lt;img width="468" height="369" border="0" alt="diagram1.jpg" src="./resolveUid/2bfbf46bf87c40a21dc22bc5c1a371c5" /&gt;&lt;/p&gt;
&lt;p&gt;Recently, however, several trends have reduced these distinctions, increasingly blurring the social and economic roles that businesses, government agencies, and nonprofits are playing. &lt;br /&gt;
&lt;br /&gt;
In the private sector, businesses and their employees are increasingly engaging in activities that previously fell under the domain of nonprofits and government. For instance, private-sector companies have begun competing in fields such as education and social services, which were once considered core government activities.&amp;nbsp; &lt;br /&gt;
&lt;br /&gt;
The public sector, too, has seen a shift in practices. As &lt;em&gt;Reinventing Government &lt;/em&gt;authors David Osborne and Ted Gaebler describe, government is increasingly steering rather than rowing and emphasizing cost-effective results over bureaucratic rules.&amp;nbsp;&amp;nbsp; According to Stephen Goldsmith, professor at Harvard&amp;rsquo;s Kennedy School of Government and director of its Innovations in American Government Awards Program, &amp;ldquo;New Deal-style initiatives, in which government assumes the dominant service-delivery role, have become increasingly rare, especially for newly developed programs.&amp;rdquo;&amp;nbsp; &lt;br /&gt;
&lt;br /&gt;
For the nonprofit sector, pressures are growing to fill gaps in public service delivery, ensuring that citizens can get the services they need even when government is unwilling or unable to provide it. In providing essential services, nonprofit leaders are striving for sustainability to ensure that they will continue to be able to meet the needs of those they serve. Following the national scandal at a major nonprofit in 1992, and as many foundations adopt outcomes-driven approaches to funding, nonprofits also face demands for accountability.&lt;br /&gt;
&lt;br /&gt;
As each sector has entered the territory of the others, the blurring between them has given rise to a host of new phenomena. An increase in public-private partnerships has involved more businesses and nonprofits as collaborators in government projects. At the same time, the increased popularity of earned-income ventures has led many nonprofits to develop business-like ventures to generate revenues.&amp;nbsp; Lastly, corporate social responsibility movements have entered the mainstream, motivating businesses to account for their community, environmental, and labor practices along with their profits. &lt;br /&gt;
&lt;br /&gt;
By blending some of the social and economic responsibilities traditionally associated with each of the three sectors, social entrepreneurship may take the form of a nonprofit, business, or government initiative. No matter what organizational form it takes, social entrepreneurship tends to exhibit characteristics of all three. Like business, social entrepreneurship utilizes markets to drive innovation and productivity. Like government, social entrepreneurship responds to market failures by providing public goods and services. Like nonprofits, social entrepreneurship engages individuals in action to achieve social goals. Alex Nicholls of Oxford University&amp;rsquo;s Skoll Centre concludes, &amp;ldquo;The organizational mechanisms employed are largely irrelevant: social entrepreneurs work in the public, private, and social sectors alike, employing for-profit, not-for-profit, and hybrid organizational forms (or a mix of all three) to deliver social value and bring about change.&amp;rdquo;&amp;nbsp; Social entrepreneurship, then, is the practice of &lt;em&gt;responding to market failures&lt;/em&gt; with &lt;em&gt;transformative&lt;/em&gt; and &lt;em&gt;financially sustainable&lt;/em&gt; innovations aimed at solving social problems. Next, we examine the three essential components of this definition.&lt;br /&gt;
&lt;/p&gt;
&lt;p&gt;&lt;img width="468" height="432" border="0" alt="diagram2.jpg" src="./resolveUid/9a91efea887e74801441fa64f8a66414" /&gt;&amp;nbsp;&lt;/p&gt;
&lt;p&gt;Next Week: &lt;strong&gt;Definition Part I: Response to Market Failures&lt;/strong&gt;&lt;/p&gt;
          ]]>
        </content:encoded>        

        <dc:date>2008-03-25T08:34:41-08:00</dc:date>

        <dc:modified>2008-04-01T13:57:11-08:00</dc:modified>

        <dc:creator>Andrew Wolk</dc:creator>

        

        
            <dc:subject>Social Entrepreneurship</dc:subject>
        

    </rss:item>

    
    

    <rss:item rdf:about="http://socialedge.org/blogs/government-engagement/archive/2008/03/18/social-entrepreneurship-and-the-case-for-government-engagement">

        <rss:title>Social Entrepreneurship and the Case for Government Engagement</rss:title>

        <rss:link>http://socialedge.org/blogs/government-engagement/archive/2008/03/18/social-entrepreneurship-and-the-case-for-government-engagement</rss:link>       

        

        <content:encoded>
          <![CDATA[
          Among President Bush&amp;rsquo;s honored guests at the 2007 State of the Union address was Julie Aigner-Clark, founder of the profitable children&amp;rsquo;s video company, Baby Einstein, and current producer of child safety videos with the National Center for Missing and Exploited Children. The president praised her, saying: &amp;ldquo;Julie represents the great enterprising spirit of America. And she is using her success to help others&amp;hellip;we are pleased to welcome this talented business entrepreneur and generous social entrepreneur.&amp;rdquo; &lt;br /&gt;
&lt;br /&gt;
That the president of the United States honored a &amp;ldquo;social entrepreneur&amp;rdquo; in his State of the Union address exemplifies the growing recognition social entrepreneurship has received in recent years. The boom of the field and its promise as a means of addressing America&amp;rsquo;s daunting social problems is of particular importance for policymakers. By far, the largest sources of services and funding to help solve these problems are federal, state, and local governments. In the domestic budget alone, the federal government spends over $1 trillion each year providing direct benefits to constituents, awarding service grants and contracts, and employing government agency staff.&amp;nbsp; State and local governments raise and spend their own funds to benefit their constituents&amp;mdash;creating an even larger pool of governmental spending and activities to solve social problems.&lt;br /&gt;
&lt;br /&gt;
Government funding dwarfs the amount spent by the nation&amp;rsquo;s largest foundations, which together donate $16.4 billion annually to nonprofits,&amp;nbsp; as well as the giving by individuals, who donate $163.5 billion each year to social causes.&amp;nbsp; Of the nation&amp;rsquo;s 144 largest and fastest-growing nonprofits&amp;mdash;all of which have $50 million or more in annual revenue&amp;mdash;more than 40 percent rely on government as their primary funding source. The next most common funding comes from service fees, which are paid at least in part by government agencies in 90 percent of cases. &lt;br /&gt;
&lt;br /&gt;
Given both the magnitude of needs and the scope of spending, government leaders constantly face tough decisions about how to improve the lives of their constituents while most effectively using tax dollars. As elected officials and government agency staff approach these tough choices, social entrepreneurs offer a new source of assistance. Government leaders and social entrepreneurs share an interest in identifying efficient, effective, and sustainable ways to solve difficult social problems. &lt;br /&gt;
&lt;br /&gt;
Although collaboration thus far between social entrepreneurs and government has occurred in isolated incidents, working together more strategically represents a yet-to-be harnessed opportunity for government leaders working to resolve social problems. By adapting some of the same levers that have successfully encouraged U.S. entrepreneurialism, government leaders have a similar opportunity to support social entrepreneurship&amp;mdash;and thereby generate transformative, financially sustainable solutions to social problems facing the nation. As Roger Martin and Sally Osberg state in a recent article for the Stanford Social Innovation Review, &amp;ldquo;Social entrepreneurship, we believe, is as vital to the progress of societies as is entrepreneurship to the progress of economies, and it merits more rigorous, serious attention than it has attracted so far.&amp;rdquo;&amp;nbsp; Just as government support of private markets and entrepreneurship has fueled growth in the U.S. economy, so too can government&amp;rsquo;s support of social entrepreneurship accelerate the solving of social problems.
          ]]>
        </content:encoded>        

        <dc:date>2008-03-18T08:41:11-08:00</dc:date>

        <dc:modified>2008-03-18T08:41:11-08:00</dc:modified>

        <dc:creator>Social Edge</dc:creator>

        


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