Ecological Model of Social Entrepreneurship

• Social Entrepreneurship is the focus of week 2.
• Participation in class discussions is optional but encouraged.
• Motivation can be intrinsic or extrinsic.
• Random Socratic Method will be used.

Idea Review

• The class will discuss the Ecological Model of Social Entrepreneurship.
• Utilitarian vs categorical reasoning is the philosophical grounding for social enterprise.

Ecological Model of Social Entrepreneurship

• The "seed" involves identifying what "bugs" or worries you.
• "Roots" involve clarifying the problem you wish to address, how you know it's a problem, and for whom it is a problem.
• The "stem" considers what the organization will do to solve the problem, and the theory of change.
• "Fertilizer" concerns sources of outside funding and how to fund the organization at start-up.
• "Water" asks how to generate revenue on a steady, ongoing basis.
• The "landscape" considers what types of organizations already address the problem, who you can collaborate with, and who you will compete with.
• Measuring tools are used to evaluate the organization's impact.

Moral Principles

• Utilitarianism (Bentham): Decisions driven by the consequences of actions (5>1).
• Categorical Reasoning (Kant): Decisions driven by the intrinsic quality of the act itself.
• Utilitarian thinker Bentham had his head embalmed.

Today's Focus

• Today's focus is on the seed and roots of social entrepreneurship.
• Identify the problems that trouble you.
• Determine what makes something a social problem.
• Discuss how to differentiate between social and commercial enterprises.
• Consider how social enterprises "shift the equilibrium" to address problems.

Response Memos

• Response memos are designed to help you prepare for class.
• Draw on readings, make connections/extensions, and use your own experiences/knowledge.
• May have to investigate an org that does not shift the equilibrium.

Group Report

• There are 3 options for the group report: Consult for an existing social enterprise, design and pitch your own, or research a strategic problem faced by social enterprises.
• Groups are assigned at random, unless you have an ongoing project; in which case you must communicate this.

Other Questions

• Course aims, deliverables, logistics and assignment info on Quercus will be discussed.

Rules of Engagement

• Expected to consider what kind of class discussions help people feel excited, engaged, curious and challenged.
• Expected to consider what steps can be taken to create those discussions.
• Considerations on how to approach difference of opinion.
• Considerations on how to make it ok for people to learn/be wrong.
• Can devices/AI enhance learning?
• Conversations should open up ideas rather than shooting them down.
• Recognize that we disagree about what makes a good society.
• Practice curiosity about what others believe about a good society.
• Use devices/AI in ways that enhance rather than detract.
• Laptops for non-class activities should be used in the back row.
• Multitasking reduces comprehension.
• Neighbors of multitaskers are also indirectly distracted.

Social Entrepreneurship Questions

• Social entrepreneurship asks what kind of society is good, prosperous, and just?
• Social entrepreneurship asks how can we create a better, more prosperous, more just society?
• Social entrepreneurship asks what does it mean to earn money in that pursuit?

Social Problems

• Rubington & Weinberg (2011) defines social problems via a sociological approach.
• Definition: "an alleged situation that is incompatible with the values of a significant number of people who agree that action is needed to alter the situation” (pg. 3)
• A social problem is a condition that disrupts or damages society (e.g., crime, racism, climate change).
• Sometimes, what is considered a problem might not actually be problematic because evidence does not support it.
• There could be evidence, but others do not agree that it is a problem (e.g. abortion (48% vs 48%)).

Social Problems Components

• Objective features: Facts that identify/measure/demonstrate the extent of the problem; based on academic research, government reports, & scientific measurements.
• Subjective features: Moral grounds on which we view those objective features as problematic; there is the "social constructivist" view that facts are problems because we believe they are problems based on our values.
• Peter L. Berger and Thomas Luckmann introduced the term "social construction" to social science in 1966.
• "Society, identity and reality are subjectively crystallized in the same process of internalization" (Berger & Luckmann).
• We decide what is real and problematic by observing others and talking about it.
• Objective Features: Based on facts, researched, measured, reported and verified state of the world
• Subjective Features: Based on values, through language & interaction, we view a state of the world as problematic (or not).
• For example: homelessness in Toronto.
• Objective Features: are what evidence makes you think this is a problem?
• Subjective Features: are what moral assumptions or frameworks make you think this is a problem? Or not a problem?
• To assess something as a social problem, we often need to understand others’ experiences.
• It can be very difficult to do this.

Understanding Others

• Psychologist Nick Epley states it is difficult for us to understand others' interior experiences.
• Understanding is more pronounced when others are more socially & psychologically distant from us.
• When others are different from us, we see them as more animal-like.
• Ascribing less intelligence, less articulation and less emotional understanding.
• Those who want to help and those targeted often differ on social class, ethnic background, education, etc.
• The challenge: If we struggle to understand others, is it possible to meaningfully help them?
• Later, in Mindwise it will be highlighted to ask people what they want/need and avoid assumptions.

Social Entrepreneurship

• Social problems have been defined, social entrepreneurship can now also be defined.
• Martin & Osberg state that Social entrepreneurship consists of:
• Identify an unjust and stable equilibrium
• Seek to shift-rather than tweak-it
• Test, refine, and scale an equilibrium-shifting change
• Results in a better quality of life for those operating within a system
• Examples of unsatisfactory equilibriums:

Equilibrium Shift

• What is a "system"? What is the unit of analysis?
• How big or small can a change be to constitute an equilibrium shift?
• What is the time horizon for change?
• Social Entrepreneurs build organizations that sustainably and radically address social problems.
• They work to maximize social impact.
• They are willing to forgo economic returns to realize social goals.

Social Vs Commercial Enterprises

• Social enterprises work primarily to create social value. Profits/revenue help them forward the social aim.
• Commercial enterprises work primarily to create financial value, although social goals help them forward the financial aim (e.g., Facebook, Google).
• Social and commercial enterprises are differentiated via primary value creation and the way they fund themselves is less important.
• Primary value creation identifies What gets measured (e.g., MicroBank).
• When one outcome needs to be prioritized over the other, which wins out?
• What happens to profits? (reinvested in addressing the problem, or accrue to investors/owners/shareholders?)
• Where would you place each of these organizations on the graph? (Tom's Shoes, Fundación Capital, Amazom, Tesla, United Way, etc)
• Organizations are not static on this graph, they're alive and likely shift over time.

Recap

• SE starts with a "seed": the notion that something is categorically or morally unjust (a la Immanuel Kant).
• Social problems are the roots of any social enterprise.
• This entails objective and subjective features.
• SEs prioritize social value creation.
• According to Martin & Osberg: social entrepreneurs "shift the equilibrium".
• This is the gold standard, most SE's don't reach it.

The Future

• It was "clear that not all social purpose organizations performed equally well" - Bornstein & Davis.
• SEs are not alone in addressing social problems and include: Govts, activists, social service providers
• How can we differentiate them? How can we "map the landscape"?
• Bring a printed or digital copy of Embrace C, which will be read in class.