Survival of Social Enterprises - Lack of funds is one of the biggest challenges faced by social enterprises that hamper its smooth functioning. |
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You are here: DIME Home > Business > Survival of Social Enterprises
Lack of funds is one of the biggest challenges faced by social enterprises that hamper its smooth functioning.
Author: Kevin Long
Date: Nov 9, 2009 - 8:52:36 AM
There are several threats and challenges associated with the growth of social enterprises. The present need is to identify remedies for promoting the development of more social enterprises across the globe.
What are social enterprises?
In order to raise income, social organizations employ entrepreneurial skills and business concepts that cause less destruction to the society and environment. As compared to other social organizations that reply on charity or donations for income, social enterprises use business skills to do so. One of the major factors that separate social enterprises from mainstream companies is their social objective. Private sector companies mostly reply on profit making for its stakeholders but social enterprises tend to strike a balance between the corporate and social world to fulfill the social objectives.
Challenges for social enterprises:
In
today’s time, everyone is worried about their job and business. In this
scenario, it may not be the right thing to encourage social enterprises as the
global financial crunch is still showing its effects on economies worldwide.
But if industry experts are to be believed, the present economic condition is
best suited to make sure that social enterprises grow. This is the best time
for such enterprises to take hold of the social, financial and environmental
challenges out there. There are many business owners who feel that a company
can either make profit or do ‘good’ to the society. One can’t deny the fact
that it is sometimes difficult to achieve efficiency and effectiveness at the same
time, but it isn’t impossible. One of the main challenges faced by social
enterprises is the lack of funds. Such enterprises always require a
stable and strong financial backing so that their objectives are fulfilled. Banks
are risk-averse and financial institutions don’t offer grants to social
enterprises on easy terms. This is the reason why business experts believe that
social entrepreneurs should operate as a commercial businessman and take all
aspects into consideration so that irregular cash flow doesn’t affect the
quality and continuity of their services. Lack of finance will also be solved
with the emergence of more social entrepreneurship funds.
Author's Bio:-
Kevin Long is the founder of Global Deaf Connection and the co-founder of Justmeans, a social utility site that helps companies to attract and ignite advocates of better business and good work related to social enterprise trends, social enterprise report & Sustainable Investment. Kevin has done significant business development work for both for-profit and non-profit organizations.
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