About Social Entrepreneurship
Social entrepreneurship has exploded with the turn of the 21st century. At its most basic, the term refers to applying the principles of entrepreneurship to advancing a social cause, good, or solution — a company or organization that is run with its mission placed above profits. That doesn’t mean it is non-profit (though it can be) nor that it doesn’t make much money; it simply means that profits are not the primary goal.
This can include any of the following types of organizational structures (examples in parentheses):
- A traditional non-profit organization, either 501(c)3 or unincorporated, that operates using entrepreneurial principles (First Book, Pencils of Promise)
- A for-profit businesses owned by a non-profit organization (Mozilla Corporation owned by the Mozilla Foundation)
- A non-profit organization owned by a for-profit company (Panera Cares)
- A for-profit business with an embedded social mission that is integral to the company; without it, the company model would not be the same or would cease to exist (TOMS Shoes)
- A traditional for-profit business that puts its social mission above profits (Honest Tea)
- A low-profit limited liability company (L3C), currently a legal entity in 11 states (MOOMilk)
- A benefit corporation, currently a legal entity in 12 states (Actuality Media); this is Social Motion Publishing’s legal structure as a project of The 180 Lab Inc.
Incidentally, “B Corp” is often confused with “benefit corporation” and sometimes erroneously used synonymously. B Corp is not a legal structure, but rather it’s a certification by the nonprofit B Lab that for-profit companies that can earn by meeting rigorous standards of social and environmental performance, accountability, and transparency.