Social Entrepreneurships & Commercial Businesses
It all starts with the different purposes the social and commercial enterprises have for setting up the business in the first place. This can be found in the different perceptions of value, since social entrepreneurships have different values than a commercial business. For the commercial entrepreneurship the main value lies in the profit they want to earn, which is not only important
to them but also for the investors. Also the commercial entrepreneurship is accountable to their investors and shareholders for generating these profits. It could be that a commercial business is also contributing to society, but this is not their business and would be more accidentally.
On the other hand, for the social entrepreneurships, there’s also value in earning profits to keep the business going. However their value can also be found in the social benefit to a community or transformation of a community that lacks the resources to fulfil its own needs. So the main difference is that social entrepreneurship focuses beyond simply generating a profit, and measures its performance on the positive impact the business has on society. This can be on a social, cultural or environmental field.
to them but also for the investors. Also the commercial entrepreneurship is accountable to their investors and shareholders for generating these profits. It could be that a commercial business is also contributing to society, but this is not their business and would be more accidentally.
On the other hand, for the social entrepreneurships, there’s also value in earning profits to keep the business going. However their value can also be found in the social benefit to a community or transformation of a community that lacks the resources to fulfil its own needs. So the main difference is that social entrepreneurship focuses beyond simply generating a profit, and measures its performance on the positive impact the business has on society. This can be on a social, cultural or environmental field.
Why would businesses become a social entrepreneurship instead of a commercial business?
More and more, kids, teens and young adults want to have a positive impact on the world. That is why social entrepreneurship is a new hype in the world of entrepreneurs. Because, who doesn’t like to do something for community, and also make money out of it.
Like other entrepreneurs change the face of business, social entrepreneurs change the business to create value for the society. By searching for opportunities others miss to improve systems, invent new approaches, and create solutions to change society in a positive way. While a normal business is searching for a new market or product, the social entrepreneur is searching for innovative solutions to social problems within an existing market. It might be easier to find the opportunity that already exist then creating a new market.
Besides that are there also some juridical benefits for being a social entrepreneur instead of a business entrepreneur. For example the United States started in 2008 with the Low-Profit Limited Liability Company (L3C), this legal form is created in the United States for the entrepreneurs with a ‘for-profit entity with a non-profit soul’. This legal form also has his fiscal advantages.
In the United Kingdom they started in 2005 with the Community Interest Company (CIC), businesses will only be titled as a CIC when they pass the community interest test, to ensure that their goal is a social goal. Like the L3C, the CIC also has his fiscal advantages, with for example a tax deduction.
And last but not least, is it easier to get investors when you are a social entrepreneur instead of a business entrepreneur. Because the choice for investors between a normal business either a social business is easy. The number one interest of investors is off course the return. But the return with investing in a normal business is only in money but with the same investment in a social entrepreneur, you could earn money and also helping the society, what makes the return even higher.
Altogether it is easier to start a social entrepreneurship when you compare it with a normal business in the area of finding investors and finding the opportunity within the market. Additionally, there are a lot of fiscal advantages for being a social entrepreneur instead of a business entrepreneur, as well.
Like other entrepreneurs change the face of business, social entrepreneurs change the business to create value for the society. By searching for opportunities others miss to improve systems, invent new approaches, and create solutions to change society in a positive way. While a normal business is searching for a new market or product, the social entrepreneur is searching for innovative solutions to social problems within an existing market. It might be easier to find the opportunity that already exist then creating a new market.
Besides that are there also some juridical benefits for being a social entrepreneur instead of a business entrepreneur. For example the United States started in 2008 with the Low-Profit Limited Liability Company (L3C), this legal form is created in the United States for the entrepreneurs with a ‘for-profit entity with a non-profit soul’. This legal form also has his fiscal advantages.
In the United Kingdom they started in 2005 with the Community Interest Company (CIC), businesses will only be titled as a CIC when they pass the community interest test, to ensure that their goal is a social goal. Like the L3C, the CIC also has his fiscal advantages, with for example a tax deduction.
And last but not least, is it easier to get investors when you are a social entrepreneur instead of a business entrepreneur. Because the choice for investors between a normal business either a social business is easy. The number one interest of investors is off course the return. But the return with investing in a normal business is only in money but with the same investment in a social entrepreneur, you could earn money and also helping the society, what makes the return even higher.
Altogether it is easier to start a social entrepreneurship when you compare it with a normal business in the area of finding investors and finding the opportunity within the market. Additionally, there are a lot of fiscal advantages for being a social entrepreneur instead of a business entrepreneur, as well.