Social entrepreneurs use profit as a tool, not a goal

Social entrepreneurs solve social problems by unleashing various resources on less-advantaged populations.

Social entrepreneurs solve social problems by unleashing various resources on less-advantaged populations.

The resources empower these populations to create their own opportunities to increase their quality of life, access employment, and become active participants in their environment and local community.

In a nutshell, these populations are finally given the tools to solve their own problems.

Nonetheless, social entrepreneurs find a sustainable way to solve social problems that have yet to be solved for decades. Centuries. Try to imagine profit as a tool, rather than the end goal of our everyday life, and you’ll be on your way to coming up with some incredible ideas.

Social entrepreneurs will develop a product or service that may prevent domestic violence, or an idea that may provide assistance to homeless people, or an idea that may reverse the effects of global warming. The purpose in this thought process is to generate ideas for new business models that use profit as the engine to sustain itself.

Having to rely on philanthropy and charitable donations is not sustainable, it creates gaps in leadership, it causes mission creep, and it can be stressful if you have not been able to lock down continuous yearly funding.

In the next section, I discuss some techniques I use to discover new business models buried beneath the dense bureaucracies of the current systems in place.

Unpack old business models

Starting a business and generating a profit for yourself is the easy part. The hard part is to find an idea that helps people, and continues to help people by generating revenue to sustain the company. This is the mark of a true entrepreneur. The entrepreneurs who build social empires that exist for generations long after they are gone. The entrepreneurs like Henry Ford and Alli Sosna.

If you’re wondering how to come up with one of these ideas, think back to Henry Ford. How did he create an innovation so incredibly disruptive that it created a product for a market that was waiting to be set free? He deconstructed the problem. He unpacked the old business model that took over 12 hours to build a car. He picked up the pieces of the old business model that he liked and created a new business model that only took 30 minutes to build a car. He reduced the cost of the vehicle, he created more jobs in the process, and he reinvested his money.

Social Entrepreneurs Build for We, the People

Without the social entrepreneur there would be no self-sustaining initiatives adding value to the economy. Profit-centric businesses focus on money, money, money  – and don’t forget, it’s your money which is the object of their affection. They are looking inside your pocket to see how much is in your wallet so they can figure out which pricing strategy to use. “How can we make sure our customers rationalize the purchase of yet another unnecessary product?” They are monitoring your activity on social networks and search engines to find out the best way to sell you their next product.

Eventually, these types of products lose value because humans don’t require them for survival. When the economy crashes again, which is supposed to happen any day now, people stop spending money on products that don’t add value to their lives. So if you’re thinking of starting a business it might be wise to think about an idea that fills basic human needs. Not only will you be one of the first in your industry, but you will also outlive the productivity tools.

As history has shown, if you build something that people need and you can get them to start using it, continue using it, can’t live without it, then getting the money later is easy. Facebook hadn’t generated one cent of revenue when it received its first billion dollar valuation. Instagram hadn’t generated one cent of revenue before it was purchased for $1 billion in cash and stocks by Facebook. The difficult part in building these types of businesses is having the time, money, and vision to build something for the long-haul. These businesses operate at a loss for many years before generating a profit.

To get to the root of many complex global problems it boils down to the way our society teaches people to behave. If society teaches people that survival is tied to individual accumulation of wealth, then it’s not hard to understand why people who run profit-hungry corporations don’t care about other people. It’s not hard to understand why you and I aren’t dedicating our lives to preventing domestic violence, hunger, poverty, and obesity. Just because I vote for a politician who believes in women’s rights does not substitute my active participation in the community.

Voting is a drug. Don’t wait for the right politician to be elected. It will never come. This country was not built to be run by one all-mighty ruler. It was meant to be run by you.

 

by Daniel D'Alonzo

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