Business or non-profit alike, don’t get left behind: New Orleans is ramping up the Impact Economy in 2013 alongside national and international trends. From greening the Super Bowl, to the Impact Economy Track featured during New Orleans Entrepreneur Week, don’t miss an opportunity to join the leading ecosystem of social enterprise in the South. Whether you are a start-up looking for a more convincing pitch, a business looking for greater consumer support, a non-profit looking to capture talent in a growing and competitive market, or even a government agency, you want to familiarize yourself with the growing Impact Economy trends as poverty-alleviation and environmental regulators are turning to private company solutions for better results.
But what is social entrepreneurship anyway?
It takes a couple of years working in the field of social entrepreneurship before you even understand the meaning of the term. This is simply the reality facing any new sector or shift in our economy. Although new phrases, terms, and trends are brought forth daily, Ashoka, pioneer and leader of the field, defines social entrepreneurship as striving “to solve social problems at a systemic level using innovative, sustainable, scalable, inclusive and measurable approaches.”
But what are these approaches? When we divide social entrepreneurship into several subcategories that together make up the “Impact Economy”, we have a clearer idea of what we mean:
Impact Investing. In the early 2000s, many funders moved away from micro-finance to a more innovative idea of funding startups with high-growth potential and significant social impact. In 2007, these groups created the Global Impact Investing Network (GIIN) to promote their work. Today, this kind of investing is called “impact investing”, also referred to as “patient capital”, “venture philanthropy”, or “social venture capital”. In 2011 the Global Impact Investing Network and J.P. Morgan published a report predicting nearly $4 billion of impact investments in 2012, and, as much as $1 trillion in the coming decade. At the 2012 Giving Pledge conference, whose billionaire attendees have pledged to donate at least half their wealth to charity, impact investing was the “hottest topic,” according to The Economist. And a 2012 Credit Suisse report affirmed J.P. Morgan’s claim that impact investing is a $1 trillion-plus market opportunity. Although these predictions are at a minimum ambitious, and at a maximum wildly inflated, there is no doubt that impact investing has captured the world’s imagination.
Micro-finance. This subcategory of the Impact Economy captures a democratization of financial exchange that allows more equitable access to financial resources, in and of itself a social impact, particularly in the developing world. Organizations like New Corps, the Idea Village, and Rebirth Financial are local entities that support local entrepreneurs in getting better access to capital. Typically, micro-finance organizations offer loans that are smaller amounts and have lower interest rates than existing banks and moneylenders. Kiva, an online marketplace for microloans, is probably the most well-known.
Social Enterprise. The individuals and organizations that loan agencies like Kiva fund are called social enterprises. They can be big, small, for-profit, or non-profit – just like any organization. The difference is that these organizations are formed to create scalable and sustainable solutions to our world’s social and environmental challenges. Such a company doesn’t simply replace their incandescent light bulbs with more efficient technology; they actually build energy efficient stoves with a mission to create a product that reduces our energy consumption.
The Global Citizen. A new worldview is forming for individuals across the globe as they identify with an ecosystem that goes far beyond their backyard, but all around the globe. A growing group of individuals who question, doubt, wonder, and consider their role in the world are shifting to a worldview that looks at our ecosystem on a planetary scale, instead of just a local one. This perspective allows individuals to be more conscious of their consumer choices and how they might effect our environment and communities worldwide.
New Civic Infrastructure and Collaboration. From developing cultural cognition or social consensus on climate change, to public-private partnerships that provide long-term solutions across election cycles, the Impact Economy depends upon an infrastructure of connectivity among the roles and players that drive collective impact. LifeCity falls in this camp of connecting organizations and individuals to leverage and maximize social and environmental returns. Urban Institute’s Sarah Wartell spoke of a sobering reality in light of diminishing federal resources due to inflation: “Our $1 will turn into $0.80, but instead of scaling back, we need to figure out how to get $1.20 of value from $0.80.” The only way to achieve that level of efficiency is through unprecedented collaboration across sectors.
The reality is that we need integrated solutions, not just investment capital, to solve our world’s greatest problems. Social enterprises need the support of conscious consumers and civic infrastructure to move us all forward and protect our long-term future.
Join the Impact Economy in New Orleans in 2013
There are several ways for your organization to get involved in this exciting movement and shift in our economy locally. We hope you will join us in any of the following ways:
1. Attend Quarterly Impact Economy Forums
2. Start a social venture through the Idea Village, Propeller, Good Work Network, or New Corps Business Assistance Center
3. Become a Certified LifeCity Company and get listed on the Impact Directory as you grow your development as a social enterprise
4. Participate in the Impact Economy Track during New Orleans Entrepreneur Week
5. Buy a Green Card and support conscious companies who can help you live a more sustainable life