This article first appeared on Social Change Central.
Although the social enterprise sector is still young in Australia, social entrepreneurs are on the rise in response to the social and environmental challenges that we are currently facing. In the recent Finding Australia’s Social Enterprise Sector (FASES) 2016 report, social entrepreneurs face major external constraints in growing both their businesses and impacts. Constraints include:
– a patchy ecosystem for social enterprise start-up and growth, including limited geographic spread of intermediaries and insufficient opportunities for peer to peer learning and development
– the continuing piecemeal awareness of and support for social enterprise development by Australian governments; and
– limited public awareness of social enterprises and their work.
Regardless of the challenges that social entrepreneurs currently face, here are 4 reasons why it is an exciting time to be a social entrepreneur in Australia!
Government buy-in
There are at least 20,000 social enterprises in Australia and at the moment, the lack of public policy and regulation in Australia remains a barrier to social enterprises looking to grow and/or fulfil their potential. Fortunately, the state and federal government are recognising the value of social enterprises in tackling the country’s economic and social challenges – in particular providing new solutions to tackle disadvantage and job creation. The Victorian government for example has formed the Social Enterprise Ministerial Committee to give the sector oversight across government, and has recently backed the creation of an Australian first social enterprise sector-wide strategy.
What you can expect:
– A raise in profile of social enterprises in the business environment, including the rise in social procurement opportunities for you to access government markets and compete with other businesses and service providers.
Improving funding
Currently, philanthropy appears to be playing a proportionately more significant role in financially supporting Australian social enterprises. Nevertheless, greater flows of financing to the social enterprise space is growing – whether it’s generating early-stage capital, increasing access to innovative approaches such as crowdfunding or further diversifying the overall funding vehicles available to social innovators. Impact investing is an area that is already blowing up – it has been identified that there are at least $18 billion of pent-up demand among local investors!
What you can expect:
– Within the next five years, investors will become more active and impact investing will become more significant. Investors are willing to invest in diverse areas such as children and older people; housing and health; arts and culture; clean energy and the environment.
– There will be significant growth in crowdfunding as people are beginning to bring more capital into this sector. Crowdfunding is becoming the place where the most exciting social enterprises often launch today and will play a key role in funding emerging social enterprises.
Better practices in measuring social impact
65% of Australian social enterprises report that they measure their impacts in relation to their missions. As of today, social impact assessment is costly and a complex issue for social enterprises operating on very lean resources, trying to meet the expectations of a diversity of stakeholders. Despite that, impact measurement appears to be of relatively greater interest to budding social enterprises that are seeking to establish legitimacy. Social enterprises seeking impact investment or other forms of social finance also place greater importance on measuring or predicting their impacts.
What you can expect:
– New models and tools for social impact measurement will continuously be developed and refined as donors and investors demand clarity of impacts in an increasingly crowded market.
– Social impact assessment will transition from being a supplement for organisational assessment to being an integrated and essential feature of any product or service analysis in this sector.
Increasing resources
As social entrepreneurship becomes more mainstream entrepreneurship, there will be an increase in available resources for social entrepreneurs. Organisations such as The School for Social Entrepreneurs Australia and Centre for Social Impact run learning programs for entrepreneurial individuals, and universities around Australia are offering social entrepreneurship subjects – with Macquarie University offering Australia’s first Master of Social Entrepreneurship.
What you can expect:
– An increasing availability of learning programs and resources through a variety of avenues – not limited to educational institutions but also intermediaries, to support and help social entrepreneurs succeed.
– Teaching agenda will not only focus on the social entrepreneur and individual ventures, but also help build the environment around them.
The growth in social enterprise has meant that many services that were traditionally provided by the public sector are now provided by social enterprises. If you are a social entrepreneur or even a budding one, now is the best time to embark on this journey to be part of the growing ecosystem and shaping this sector in Australia.
