How do for-profit social enterprises differ from non-profits?

Discussion is emerging on the idea of a for-profit social enterprise ecosystem. In a recent Yale School of Management interview, two innovative CEOs of social enterprises are questioned on social goals and profit motives.

An increasing factor that matters to employees is being part of a business with a social mission. Businesses with a social mission and the ability to generate revenue to fund it will ultimately reach higher success rates with that goal.

A call is made for policy makers to look at policy that acts as a disincentive to sustainability and socially-positive activity by businesses. Current policy causes behavior that increases difficulty of consumers to make social minded decisions that, if resolved, would benefit certain organizations with sustainability in mind as well.

The question begging to be asked was “Should non-profits be concerned that for-profit social enterprises will compete with them?” Simply, a for-profit’s ability to generate revenue and deliver a superior product will be resilient. Too many non-profits are fragile and at risk, they will continue to hope the big donors come to dinner while burning the midnight oil with marketing dollars and watching for-profit social enterprises flourish.

The paradigm is shifting on social enterprises and sustainability.