We talked with Ayesha Khan: CEO of Acumen Pakistan about identifying social entrepreneurship and how it is vital for social entrepreneurs to have a viable business plan as well as an impact plan.
Social entrepreneurship is a greatly misunderstood phenomenon. What do you think we can do to overcome this hurdle?
I don’t think it is possible to have a one size fits all categorization of social entrepreneurship. By definition, this is a rather loose term that can encompass a lot and that is not necessarily a bad thing. Instead of getting caught up in the semantics of whether a business leveraging grants/donations to solve a social problem (e.g. TCF) is a social enterprise or whether that term is limited to those businesses that earn revenues directly from end users (e.g. Grameen bank), we need to think about the primary focus of a business. A business that places an equal, if not greater importance on social impact (in terms of social or environmental indicators) instead of a singular push on financial indicators is a social enterprise. The more activity we see in this space, the more we will all start intuitively understanding what it really means.
In your opinion, what is impact and how important is it to look at the business side while keeping impact in mind?
Financial sustainability is critical for any business to survive. As such, there really is no question of being fuzzy headed about the “business side” of things. If you are not able to manage your cash flows, you will not survive, no matter how worthy your goals and how lofty your aspirations for social change may be. Similarly, when we talk about impact, we have to be very careful to define precisely what we mean by that. Are we referring to depth of impact? Breadth of impact? And impact on whom?