NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, February 14, 2013

Social entrepreneurship is a hot trend in the startup space today, but the fact is, not all social entrepreneurs are created equal. The innovators we ought to support are the ones who see a need and design a business solution to address it, rather than those who start businesses to make money and choose to give a little back. Profit is OK, we’re talking business here, but to achieve deep and long-term social impact, profit can’t come before purpose.

Here’s an example of why this distinction matters. In December 1955, Rosa Parks was arrested and convicted of disorderly conduct for refusing to leave her seat on a segregated bus in Montgomery, Alabama. The leadership of the city’s African American community responded in support of Parks by founding the Montgomery Improvement Association (MIA), an organization deeply committed to justice and equality, two critical societal needs. The founders soon looked to a young preacher by the name of Dr. Martin Luther King, Jr. to lead the fledgling organization and guide a bus boycott—the campaign that would later make Dr. King a household name in the fight for civil rights.