What a frustrating read this article is in the WSJ: "Why social enterprise rarely works", which is apparently 'true' because the researchers of a report "failed to find a single subsidy-free social enterprise", and therefore "few if any of the businesses set up by nonprofits are truly self-sustaining". This is the kind of ridiculously reductive territory we get into where people insist on defining things so narrowly by structure. So, because organisations have funding from mixed sources, they're a failure? Great analysis there. There's more as well:
"The report advocates a new model that embraces the entrepreneurial spirit of the business world without expecting social-service groups to be self-supporting. "There's no shame in subsidy," says Neil Kleiman, one of the report's authors."
Ah! Now we're getting it: the structure alone doesn't guarantee success, but entrepreneurial spirit and flair will....coupled with an opportunism to marshal resources to achieve desired outcomes. Of course there is no shame in subsidy or grant in achieving a social mission....the problems come in over-reliance in any one area, be that a single grant or one big contract, and in not costing to recover full costs and generating unrestricted income for reserves. It is less entrepreneurial to stick rigidly to a model that isn't working, and ignore opportunities that could help further the social mission.
The sad thing is that the WSJ article simply brands this as a failure, and uses one example to generalise widely: "stick to what you know....business is hard". Which feels a little like third sector orgs being patted on the head. But the insight this organisation (Seedco) and its report reached is a pretty simple one: an entrepreneurial drive, spirit, creativity and opportunism can help further a social mission and help ensure its sustainability (in all senses, human, environmental as well as financial). A legal structure or model won't do that on its own, so "getting caught up in the [social enterprise] mantra", as they refer to it, can be misleading.
Look forward to the WSJ article that says: social entrepreneurs are changing things, using their characteristics and traits to create social change, using a whole range of different legal structures, business models and organisational types. Or perhaps we should follow their lead: "stick to what you know....social entrepreneurship is hard."