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Business With a Conscience: the Rise of Social Enterprise

October 24, 2022
Megan Ferringer
6 minute read
Business With a Conscience: the Rise of Social Enterprise
Business With a Conscience: the Rise of Social Enterprise

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Swyft Filings is committed to providing accurate, reliable information to help you make informed decisions for your business. That's why our content is written and edited by professional editors, writers, and subject matter experts. Learn more about how Swyft Filings works, our editorial team and standards, what our customers think of us, and more on our trust page.

Megan Ferringer
Written by Megan Ferringer
Written byMegan Ferringer
Updated November 02, 2023
Edited by Zachary Ace Aiuppa
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Today's entrepreneurs have their sights set on more than just making a profit. They want to solve some of the world's biggest problems while they're at it.

Take Blake Mycoskie, for example. After a trip to Argentina many years ago, he came home inspired to launch his own shoe retail business, TOMS. But Mycoskie pledged to make his business different — for every pair of shoes sold, he would donate one pair to communities in need.

Known as the "One-For-One" campaign, it has since expanded to support water, sight, birth, and anti-bullying initiatives, helping to raise awareness about issues like global poverty and health. As of 2019, the organization had provided people in developing countries with 95 million pairs of shoes.

This is called "social entrepreneurship" or a "social enterprise," and it's an approach to business that's sparked by people asking themselves, "What can I do to make the world a better place?"

Today, this business model is a fast-growing and undeniable force in the global economy (and a fierce catalyst for social change, too). One-third of startups globally have made doing social good a part of their core mission.

This rise in social enterprises makes sense — and it's due, in large part, to the changing priorities of younger generations like millennials. Today's younger generations are just as interested in making a positive impact on the world as they are with financial success.

In fact, nearly 94% of millennials want to use their skills to make a difference for a cause they care about. Couple that statistic with the fact that 86% of millennial consumers value businesses as much for their citizenry as their products, and you have the perfect formula for success — combining capitalism with a do-gooder mentality.

Are you interested in building a business that can help save the world? Before you jump in and start mapping out your own business plan for a social enterprise, there are a few things you should know, starting with what social enterprises are, what they look like, and tips for forming one of your own.

What does it mean to be a social enterprise?

At its simplest, a social enterprise is a type of business where the success metrics are measured in more than just profits; it's about using your business model to enact positive change in the world, too.

Think of it this way — a social enterprise exists to achieve a social mission, such as providing safe and accessible drinking water for the poor or introducing career development and training opportunities in underprivileged communities. This means their ultimate bottom-line is to contribute to a better world instead of reaping financial benefits.

While profits aren't the primary motivator behind a social enterprise, revenue plays a vital role in its sustainability and success. Sustainable revenue is what differentiates a social enterprise from a traditional charity, which usually relies on outside funding in the form of donations or grants to achieve its social mission.  

This doesn't mean a social enterprise can't be profitable (because they certainly can be). Instead, it means that the priority is to reinvest that money into their social mission.

A social enterprise will usually measure its success by looking at three major factors:


This is the impact your business has on the environment. Are you doing your part to build a more sustainable planet and reduce the carbon footprint of your business and customers?


This is the impact your business has on other people and communities, as well as your business' ability to improve lives and communities sustainably.


To make a positive impact, your business needs to make money to sustain itself, pay workers, and grow. The more profit you make, the bigger impact your social enterprise can potentially have on the world.  

What Kind of Social Enterprises Exist?

Social enterprises are rooted in a shared goal to make the world a better place, but that's usually where the similarities end. That's because finding a cause that matters is personal. Everyone has their own unique motivations and reasons for becoming a social entrepreneur. For that reason, the term "social enterprise" winds up being a pretty broad and overwhelming type of business model for any entrepreneur looking to do some social good.

So if you're looking into starting a social enterprise of your own, how would you know where to start? Fortunately, there are a few overarching models that social entrepreneurs mold their businesses from.

The Innovation Model

Do new ideas and innovation drive you? Do you love building new products or services to make other people's lives easier? If so, the Innovation Model may be the best path for your social enterprise. This is all about addressing a social need through innovative products designed to improve lives or solve a problem.


D.Light is just one example out of hundreds of companies using innovation to help others. This company designs affordable solar-powered devices that provide an option to people who lack access to reliable energy sources. In its eight-year history, D.Light has sold more than 10 million solar lamps, improving 50 million people's lives.


Benetech uses software to create positive social change. One of Benetech's signature programs is Bookshare, the largest literacy resource for people with disabilities. Before Bookshare, only 5% of printed materials were accessible to people with disabilities. Today, Bookshare's more than 330,000 subscribers have access to more than 300,000 titles in accessible formats.

The Employment Model

This social enterprise model is for the entrepreneur who wants to help disadvantaged populations through education, training, and career opportunities.

Faire Collection

Faire Collection, for example, is a social enterprise that employs disadvantaged people at a fair wage. The company hires local artisans to create jewelry that's eventually sold in markets. This provides dignified living wages to help others get out of poverty.


SIMPLi supports international farmers in their fight against poverty. SIMPLi co-owners Sarela Herrada and Matt Cohen work directly with farmers in communities around the world to bring produce to consumers ethically. In doing so, they're ditching unfair practices often seen in traditional supply chains and instead empowering international farmers to fight inequality.

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The Give Back Model

The Give Back Model might be the most well-known model for social enterprises. Businesses like TOMS, Warby Parker, and hundreds more have built their businesses around a relatively simple concept — for every purchase a consumer makes, they'll give something back in return to a community in need. This can be anything from the exact product your business makes to matching the cost of a product in donations to a cause you care about most.

Lord Jameson

For example, Lord Jameson is a small business that's on a mission to foster the bond between dogs and humans. One way the company does this is by making high-quality, organic dog treats and donating the proceeds to animal welfare organizations.

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1For1 Water

Another business using the Give Back Model is 1For1 Water, which sells natural spring water in eco-friendly, biodegradable bottles. For every bottle bought, they donate one liter of clean drinking water to people in need. The company donates time, money, and resources to digging wells in developing rural communities.

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How Do You Start a Social Enterprise?

Do you firmly believe that every child in America should have access to fresh, affordable produce? Are you passionate about creating career opportunities for communities with high unemployment rates? If you've ever found yourself driven to better the lives of others, then social entrepreneurship just might be your calling.

But where do you even start? How do you know what cause to focus on, and how can you turn that into a business model? Here are a few tips to help you get started.

Figure Out What You Care About Most

For the most successful social enterprises, passion comes first, and the product comes second. That means you need to figure out your "why" before zeroing in on the "what" and "how."

This mindset helps keep your business grounded and focused on what truly matters. From there, you can plug in your existing knowledge and expertise to find the right solution, product, or service to help you get there.

Leverage Your Strengths

Like starting any other business, you need to use your knowledge, leverage your strengths, tap into your past experiences, and turn them into innovative ideas that are practical and profitable.

For example, Dan Kurzrock took his passion for beer and background in economics and entrepreneurship to create ReGrained. He combined these things to create a business that turns the spent grain left behind from brewers into tasty, healthy treats. In doing so, he's helping to reduce waste and protect the environment.  

Whatever your expertise is, the goal is to keep your eyes and mind open to see how you can take your existing skillsets and use them to solve social problems in new, different, and more innovative ways.

Listen To Your Customers

If you're still not sure where to start, look towards your customers and your community. They can tell you a lot about the demand in the market and what people actually need.

To build a social enterprise that resonates, you need to show how and why your business is relevant and how you solve their problems. Do your research, get into the trenches (visit local homeless shelters, underserved neighborhoods, or medical centers), talk to your community members, and identify the gap before you build a solution.

Are you ready to start your social enterprise?

Some people start businesses to create a new source of income. Others seek to improve their quality of life. And some see an unmet need in the market that they can't resist filling.

But sometimes, the desire to use a business as a catalyst for positive change ignites the entrepreneurial spirit, too. Acknowledging this passion, and what causes you care about most, is the first step to embarking on a journey to raise awareness, grow funding, and changing the world for the better.

As a social entrepreneur, you should spend your time on changing the world — not worrying about paperwork for your business. When you're ready to make your business idea official, Swyft Filings can help you get started. Reach out to our experts to learn how to establish an LLC for your social enterprise today in as few as 10 minutes!

Originally published on October 24, 2022, and last edited on November 02, 2023.
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