Benefiting society with products and services holds more weight than just money when it comes to social entrepreneurship. (Photo: iStock)

Giving people fish, teaching them how to fish, and revolutionizing the fishing industry are three phases in the history of social entrepreneurship.

“There is broad agreement that social entrepreneurs and their undertakings are driven by social goals; that is, the desire to benefit society in some way or ways,” reads Social Entrepreneurship: A Critical Review of the Concept, an article published in The Journal of World Business by Ana María Peredo, a researcher at the Faculty of Business of the University of Victoria in Canada.

This is another way of saying that the social entrepreneur aims in some way to increase “social value,” i.e. to contribute to the welfare or well-being in a given human community.

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Giving people fish

In this sense, civil associations that donate food to marginalized people, for example, are an expression of the first phase of social entrepreneurship development, in which 100% of the focus is on “giving people fish”.

These organizations are normally based on voluntary work, in which participants give their time and talent to meet altruistic objectives.

No profit of any kind is obtained with these tasks, other than that of complying with the precept of helping others.

Teaching people how to fish

However, when the goal is to “teach people how to fish”, the social entrepreneurship structure becomes more complex. One example of this is Pro México Indígena, a 20-year-old foundation focused on providing self-sustainability to Mazahua, Otomi, Tseltal, Maya, Mazatec, Chinantec, Purépecha, and Me’phaas communities in seven of the country’s states.

Lucía Gómez Arriola, general director of this foundation, says in an interview for Tec Review that for her, social entrepreneurship has putting the common good at its core, rather than the good of the individual.

“This fast-paced world in which we live invites us to be selfish, but social entrepreneurship is just the opposite, since it’s about generating empathy and resilience towards the problems of others, and then being able to say, ‘If the problem belongs to somebody else, it also belongs to me’,” she says.

The star projects of this foundation include Maz B’itu (whose meaning in Mazahua is cloth), which consists of online sales of dog collars and horse earmuffs, among other products embroidered by Mazahua women from the State of Mexico.

The money obtained is for these artisans, and also to continue with altruistic consultancy projects for marginalized communities in Mexico.

“We’re a bridge in commercialization. We want to strengthen the indigenous peoples’ talent, and to enhance their crafts,” Gómez Arriola says.

Revolutionizing the fishing industry

Social entrepreneurship and profit aren’t as opposite as oil and water. They can even be two sides of the same coin.

In its most developed phase, social entrepreneurship goes beyond “giving people fish”, or “teaching people how to fish”, and becomes a means to “revolutionize the fishing industry” through a business plan that doesn’t serve as a sole or main objective.

“This type of entrepreneurship is the best of the organizations that seek to solve a problem, but that use a business model as a means, and not as an end, to make the project sustainable,” says Jairo Ruiz Nava, National Director of Innovative Social Entrepreneurship (ESi), at the Eugenio Garza Lagüera Entrepreneurship Institute of Tecnológico de Monterrey, in an interview for Tec Review.

Ruiz Nava explains that it’d be very difficult for social enterprises to one day compete with big commercial companies such as Amazon or Google. However, their profits aren’t insignificant.

“There are social enterprises in Mexico that earn 10 million pesos a year, not at all insignificant, since there are commercial companies which don’t even reach a million pesos in annual profits,” he says.

According to the national director of ESi, Mexican social enterprises aren’t only capable of offering products or services that benefit society, but also of paying their employees market-competitive salaries.

One example of these is Iluméxico, a company that provides electricity from solar panels to isolated villages that in the past only had coal or firewood as sources of energy at home.

There’s also Pixza, a pizzeria that gives away slices of their product to homeless people for every pizza that customers buy.

Another example is Isla Urbana, a company that provides drinking water to marginalized communities in the country through home-made systems for collecting and purifying rain.

This is how it’s possible to close the virtuous cycle between business and philanthropy, as Bill Drayton, creator of Ashoka, the world’s largest social entrepreneur association, asserted in the late 1980s:

“Social entrepreneurs are not content just to give a fish or teach how to fish. They will not rest until they have revolutionized the fishing industry.”