The Questionable Premise of Social Entrepreneurship
Social entrepreneurship and impact investing are based on market tools solving social problems. But is that the right way to think about it?
Sometimes Uncharted encounters entrepreneurs who say some version of the following: “I was outraged by our society’s lack of commitment to fighting climate change, so I started an environmentally-friendly coffee company.” Our industry often acknowledges how these entrepreneurs are doing “inspiring work to change the world.” But there seems to be a disproportionality between problem and solution: your solution to society’s apathy towards climate change is an environmentally friendly coffee company? Really?
In Anand Giridharadas’s new book Winners Take All, he contends that the tools—like social entrepreneurship and impact investing—to change the world are not only ineffective at achieving major change, but that by directing time and resources towards private business and capital, aspiring changemakers are neglecting more effective, structural approaches through public policy and political arenas. Giridharadas suggests that so much focus on the conspicuous and sexy might be a way to avoid making sacrifices to do the slow, nonlinear work of changing systems and structures.