Social Enterprises and Impact Investing
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What is a common consequence of pressure from impact investors on social enterprises?

  • A decrease in the overall mission of the enterprise.
  • Increased financial transparency.
  • A stronger focus on the social mission.
  • The social impact becomes secondary to growth. (correct)

    • According to the content, what are the two meanings embedded in the term 'profit'?

  • Social good and shared value.
  • Tax reduction and operational efficiency.
  • Reinvestable margin and financial extraction. (correct)
  • Increased market share and brand recognition.

    • What is the key to eliminating financial extraction?

  • Implementing robust CSR initiatives
  • Caps on compensation (correct)
  • Optimizing any organization for social impact
  • Maximizing profits for shareholders

    • What is the core problem with the concept of the 'Triple Bottom Line' as indicated in the text?

    <p>It creates confusion because of how profit and other motives are defined. (D)</p> Signup and view all the answers

    What does 'ethics by design' entail according to the text?

    <p>Building ethical considerations into a new venture from its inception. (C)</p> Signup and view all the answers

    In the context of the individual assignment, what is a 'PGE Playbook'?

    <p>A plan outlining the company's initial strategies for a fictional company. (B)</p> Signup and view all the answers

    What is the suggested compensation level for optimal happiness, according to the text?

    <p>A salary of around $75,000 per year. (A)</p> Signup and view all the answers

    What is the primary focus of Impact Venture Capital (VC) firms?

    <p>Funding businesses that pursue social enterprises and underserved communities. (C)</p> Signup and view all the answers

    What does the assignment ask students to do regarding the 'University of Amsterdam Entrepreneurship curriculum'?

    <p>Propose ideas for new courses while describing how to reinvent the current curriculum. (C)</p> Signup and view all the answers

    What does the text say about equity compensation?

    <p>Equity compensation should be avoided. (A)</p> Signup and view all the answers

    What does the term 'mission drift' refer to, in the context of social enterprises?

    <p>When the social impact becomes less of a priority in favor of hypergrowth. (B)</p> Signup and view all the answers

    What is 'Balkenende norm' according to the text?

    <p>A guideline of around 200,000 Euros for CEO compensation. (B)</p> Signup and view all the answers

    What is a typical historic compensation ratio for CEOs according to the text?

    <p>10:1 (C)</p> Signup and view all the answers

    What is the suggested approach for designing a 'non-extractive company' according to the content?

    <p>Designing a Sustainable Business Model Canvas, an MVP experiment, and a 'PGE Playbook'. (A)</p> Signup and view all the answers

    What is the primary focus of many social enterprises, according to the text?

    <p>Working on Sustainable Development Goals (SDGs). (A)</p> Signup and view all the answers

    What is a core assumption of the 'one big push' approach to business?

    <p>Business is a 'winner take all' / zero-sum game. (B)</p> Signup and view all the answers

    What is the relationship between financial extraction and compensation?

    <p>Financial extraction can be eliminated via compensation restrictions. (B)</p> Signup and view all the answers

    In the context of dart-throwing, what does walking across the room and placing the dart on the target represent?

    <p>Bootstrapping (A)</p> Signup and view all the answers

    What is the relationship between Lean Startup and Agile, as described in this text?

    <p>Lean Startup is the 'agile' of business. (A)</p> Signup and view all the answers

    In the Stone Soup parable, what is the most accurate representation of the 'stone'?

    <p>The vision and idea that brings people together. (A)</p> Signup and view all the answers

    What does the principle of 'talking to everyone who will listen' emphasize in an entrepreneurial environment?

    <p>Engaging with a wide range of stakeholders, regardless of their expertise. (A)</p> Signup and view all the answers

    What is the main purpose of using the dart-throwing analogy?

    <p>To explain the distinction between rapid growth and bootstrapping. (A)</p> Signup and view all the answers

    What is the primary role of the poor man in the Stone Soup parable, within the entrepreneurial context?

    <p>To convey his vision to gather the required elements. (C)</p> Signup and view all the answers

    Software engineering concepts like 'Waterfall model', 'Agile', and 'DevOps' are used in the context to demonstrate what?

    <p>That business approaches can also be iterative, like software. (A)</p> Signup and view all the answers

    What mindset shift is necessary for better cooperation in business?

    <p>From a scarcity to an abundance mindset (D)</p> Signup and view all the answers

    Which of the following is NOT mentioned as a requirement for non-extractive companies?

    <p>Establishing a strong market dominance (D)</p> Signup and view all the answers

    What did the open source community achieve that relates to non-extractive entities?

    <p>Used contract law to establish their framework (D)</p> Signup and view all the answers

    According to the content, what does a good product-market fit entail?

    <p>It ensures alignment between product offerings and market demand (B)</p> Signup and view all the answers

    What is implied as a potential outcome of DIY approaches to business entity forms?

    <p>It might inspire legislative changes for non-extractive entities (A)</p> Signup and view all the answers

    What role do taxes play in supporting entrepreneurs according to the content?

    <p>They help create social safety nets that reduce entrepreneurial risk. (D)</p> Signup and view all the answers

    What is suggested about founders and their financial stability in the Post Growth Economy?

    <p>Founders should have a reasonable salary and pension to ensure retirement. (D)</p> Signup and view all the answers

    According to the content, what is the general attitude towards entrepreneurial risk?

    <p>It is considered significantly overrated. (A)</p> Signup and view all the answers

    In the context of the Post Growth Economy, what is emphasized about the financial structure of businesses?

    <p>It should be self-funding and manageable within reasonable limits. (A)</p> Signup and view all the answers

    What is a key reason founders seek to ‘cash out’ according to the content?

    <p>To ensure financial independence for retirement. (B)</p> Signup and view all the answers

    What percentage of shareholder support do shareholder proposals submitted by gadflies win on average?

    <p>47.8% (A)</p> Signup and view all the answers

    What is the minimum shareholding requirement for submitting a shareholder resolution in the UK?

    <p>100+ shareholders and 100 GBP (D)</p> Signup and view all the answers

    Which of the following is NOT a way to maximize proxy votes?

    <p>Maximizing returns for shareholders (B)</p> Signup and view all the answers

    What is the main reason for the high share capital requirements for submitting shareholder resolutions in some countries?

    <p>To discourage frivolous proposals (D)</p> Signup and view all the answers

    What is the approximate market share of the two leading proxy advisory firms, ISS and Glass Lewis?

    <p>95% (B)</p> Signup and view all the answers

    What is a potential issue with the use of index funds for corporate governance?

    <p>Index funds typically have a passive approach to voting, which can overlook important governance concerns. (A)</p> Signup and view all the answers

    Which of the following is NOT a proxy advisory service mentioned in the text?

    <p>ProxyVote (D)</p> Signup and view all the answers

    What is the main reason why asset owners often rely on proxy advisory services to make voting decisions?

    <p>Asset owners lack the resources and expertise to conduct thorough research. (B)</p> Signup and view all the answers

    Study Notes

    Post-Growth Entrepreneurship

    • Presentation by Dr. Melanie Rieback, University of Amsterdam
    • Focuses on the concept of post-growth entrepreneurship, a movement advocating for non-extractive business models, questioning current growth-driven systems.

    Open Source License

    • Slide deck licensed under Creative Commons (CC BY-SA 4.0)

    Fundamental Questions

    • Is growth good?
    • What is financial extraction?
    • Who is the startup ecosystem working for?

    Objectives

    • Achieve system change vs. fighting symptoms
    • Provide actionable alternatives for:
      • Entrepreneurs
      • Corporations
      • Governments
      • NGOs
      • Financial industry

    Course Outline (Part I – Introduction)

    • Setting the stage
    • Speaker introduction
    • Making business personal:
      • Importance of personal values in business
    • Business as activism/art/spirituality/creative expression

    Course Outline (Part II – Status Quo)

    • Questioning business:
      • Examining the flaws in the current business models
    • Financial extraction + growth
    • Silicon Valley Model
    • Capital/Scale/Exit
    • Startup Ecosystem
    • Business education
    • Incubators + business schools
    • Social enterprise
    • Building blocks
    • What is wrong? (greenwashing)
    • How to fix it?

    Course Outline (Part IV – PGE Methodology)

    • Micro-level (personal)
    • Meso-level (business)
    • Macro-level (economics)

    Course Outline (Part V – Infrastructure)

    • Reinventing:
      • Startup Ecosystem
      • Investment and Finance
    • "The New Normal": how can we move forward together?

    Course Outline (Other Parts)

    • Who Am I?
    • Making Business Personal
    • Business as Activism
    • Business as Art
    • Business as Spirituality
      • Eastern Religions (Buddhism, Taoism)
      • Semitic Religions (Judaism, Christianity, Islam)
      • Ancient Greek and Roman Philosophies
    • Business as Self Expression
      • Hero's Journey (Joseph Campbell)
      • Synchronicity and Scavenger Hunts
    • Financial Extraction:
      • The Story of the 11th Round by Bernhard Lietaer and Charles Eisenstein
    • Questions About Growth
    • Growth Curves in Business by Kate Raworth
    • Silicon Valley Model
      • Capital
      • Scale
      • Exit
      • Valuations
    • Pump and Dump
    • Who Pays For This?
    • Unicorns
    • Term Sheets Matter
    • Liquidation Preference
    • Multiples + Participation
    • Preference Stacks
    • Why Founders Accept This
    • Business Education
      • General Education
      • Business Schools
        • Case Study: EC10 Walkout
        • Critiques of current business schools
      • Startup Incubators
        • Batavia Industrial Center
        • High-Tech Incubators
        • Conflict of Interest
    • Social Enterprise
      • Systemic problems require systemic solutions
      • Blaming individuals/consumers is counterproductive
      • Consumer choice implies the availability of viable and cost-effective alternatives
    • Social Enterprise Building Blocks
    • Social Mission
      • Commitment to social mission and Triple Bottom Line
      • Writing into statutes to make it legally binding
      • Attempts to overcome shareholder primacy
      • B Corp movement
    • Low-Profit Entity Forms
      • Official legal entity forms
      • Feature asset locks
    • Non-Profit Entity Forms
      • Foundations as companies
      • Examples (universities, hospitals, Wikipedia)
      • Foundation-owned companies
      • Hybrid forms are common in social enterprise
    • Steward Ownership
      • Led by Armin Steuernagel (2017) and Purpose Foundation
      • “Self-ownership”, profit rights separated from voting rights
      • Golden share: “poison pill”
    • Cooperatives
      • Co-ops as a stakeholder governance model
      • Worker-owned/employee-owned
      • Stakeholder ownership
      • Platform cooperatives
    • Sustainability
      • Ecological sustainability (climate change, biodiversity)
      • Resource usage (reduce, reuse, recycle)
      • Ecological regeneration
      • Rebuilding non-monetized human relationships
      • Cradle-to-cradle approach
    • Inclusive
      • Transparency (financial data, KPIs, strategic information)
      • Participatory
    • Local
      • Business focused on stimulating local ecosystems
      • Community shops, pubs, community banks
      • Decentralized organization (Buurtzorg)
      • Horizontal organization
      • Note: separate issue from blockchains, cryptocurrency, etc
    • Charitable
      • Percentage of profits to charity
      • No-dividend companies for solving human problems
        • Type 1 and Type 2 companies
        • Examples (Arvind Eye Care Center, Aga Khan University Hospital
    • What's Wrong With Social Enterprise?
      • Social enterprise being extractive
      • Greenwashing
      • Social mission statements covering harmful business models
      • Mission drift
      • Impact watering down over time in favor of growth
    • Profit's Double Meaning
    • Limits to Growth
    • 1972 report
    • Post-Growth Economics
    • Degrowth
      • Thought leaders (19th century, Décroissance, etc)
    • Doughnut Economics by Kate Raworth
    • New Economics
      • More Thought Leaders (Douglas Rushkoff, Charles Eisenstein, etc)
    • PGE
      • Definition of PGE
      • Main elements of PGE (Bootstrapping, Flat Growth, Non-extraction)
    • Beyond the SDGs
      • What are the SDGs?
    • Ethics by Design
    • Cybersecurity and ethics parallels
    • Compensation Caps
      • Elimination of financial extraction
    • Who Is PGE For?
    • Bootstrapping
      • Why bootstrapping is important
    • Capital is a distraction
    • Extraction Hurts Businesses
    • Network Effects + Economies of Scale
    • Playing Darts
      • Analogies of hypergrowth vs. bootstrapping
    • Software Engineering
      • Similar Concepts (waterfall, agile, DevOps)
    • Bootstrapping Principles
    • Stone Soup Parable
    • My Version of the Parable
    • Talk to Everyone Who Will Listen
    • Preach to Your Choir
    • Start Small
    • Refactoring
      • Keeping overhead low
      • Refactoring repeating activities
    • PGE Playbook
      • Act I and II getting started
    • Possible Non-Extractive Companies
    • Business Model Recipes
    • What Does This Look Like In Practice?
    • PGE Startup Bootcamp
    • Journey (place, time)
    • Location
    • Ideation
    • Check-In
    • Community (nature, peer learning, presentations, art, culture)
    • The New Normal
    • Online PGE 10-Week Incubation Program
    • 2022 Cohort
    • Monicah Muhoya (PGE 2021)
    • Part IV: PGE Methodology
    • Micro-Level (Personal)
      • Personal Qualities (vulnerability, patience, communications, listening, self-care)
    • Meso-Level (Business)
      • Collaboration vs. Competition
      • Business is Creative Alignment
      • Implementing Non-Extraction
    • Sales and Marketing (product-market fit, evangelism, earned media)
    • Management (horizontal management, holocracy, sociocracy, teal)
    • Intellectual Property (patents, copyrights, trademarks, open-source)
    • Law (mediation, visual contracts)
    • Pricing (different pricing strategies, cross-subsidization)
    • Taxes (non-extractive business and tax breaks)
    • Retirement (financial sustainability and avoiding exploitation)
    • Macro-Level (Economy)
      • Governments (role in entrepreneurial enterprise, socializing costs)
      • Global Development (extractive business' impact)
      • Universal Basic Income (UBI)
      • Modern Monetary Theory (MMT)
      • Central Banks
      • Dutch Central Bank (DNB)
    • Part VI: Finance and Investment (political act of investment, money flows)
      • Extraction in finance
      • Stock buybacks (case study: Apple, Meta)
      • Engine No. 1
    • "Woke" Finance War
    • "Anti-Woke" Activism
    • Leveraged Buyouts (LBOs) (Case Study: Elon Musk's LBO of Twitter)
    • ESG Investing
    • The Problem With ESG (taxonomies, environmental and social issues)
    • Conclusion
    • Group Assignment (Feb 12)
    • Questions?

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    Description

    This quiz explores the dynamics between social enterprises and impact investors, focusing on key concepts such as profit, ethics, and compensation. It challenges learners to think critically about the implications of financial priorities and mission sustainability in social ventures.

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