Harvard Business School Professor V. Kasturi Rangan, one of the pioneers of Harvard Business School's Social Enterprise Initiative made the following comments in a Q&A available on the Harvard Business School Working Knowledge site: The Coming Transformation of Social Enterprise (September 15, 2008): Q: Many alumni get involved with corporate social...
SOCIAL ENTERPRISE
Social enterprises are businesses whose primary purpose is the common good. They use the methods and disciplines of business and the power of the marketplace to advance their social, environmental and human justice agendas. … In its early days, the social enterprise movement was identified mainly with nonprofits that used business models and earned income strategies to pursue their mission. Today, it also encompasses for-profits whose driving purpose is social. Mission is primary and fundamental; organizational form is a strategic question of what will best advance the social mission. – Social Enterprise Alliance
Entrepreneurs with social goals must consider many factors in determining the appropriate structure – whether it involves a nonprofit organization, a for-profit entity (including the so-called hybrid entities—B corporations, benefit corporations, flexible purpose corporations, and L3Cs), or both. Understanding the different forms and utilizing the appropriate ones may be critical in the implementation of the social/business plan.
L3C – Low-profit Limited Liability Company
The low-profit, limited liability company, or L3C, is sometimes referred to as a type of hybrid of a nonprofit and for-profit organization. More specifically, it is a new type of limited liability company (LLC) designed to attract private investments and philanthropic capital in ventures designed to provide a social...
New York Times on the “Fourth Sector”
In the May 6, 2007 edition of the New York Times: "Businesses Try to Make Money and Save the World." Here are some interesting points made in the article: Bay Area attorney R. Todd Johnson is working on creating an online wiki focused on "for-benefit corporations" Goldman Sachs has...
CoF Advanced Legal Seminar – Low-profit Limited Liability Company (L3C)
At the Council on Foundation Conference, former director of the Exempt Organizations division of the IRS Marcus Owens discussed the concept of a new form of legal entity that might be an appropriate vehicle (1) for social enterprises, and (2) to receive program-related investments – the low-profit limited liability...
CoF Advanced Legal Seminar – Program-Related Investments
The Advanced Legal Seminar given at the Council on Foundations Conference featured Lisa Johnsen of Kirkpatrick & Lockhart Preston Gates Ellis; Marcus Owens of Caplin & Drysdale and former head of the Exempt Organizations division of the IRS; LaVerne Woods of Davis Wright & Tremaine and Chair of the...
Net Impact Annual Conference – October 27-29, 2006
Net Impact, a charitable nonprofit organization with a network of 10,000 members in 75 cities on 4 continents, held its 14th Annual Conference in Chicago last weekend. The theme of the Conference, hosted this year by the Kellogg School of Management: Navigating Global Change. The principal keynote speaker was...
Nonprofit Joint Ventures – Introduction
What is a joint venture? Broadly defined, a joint venture is a relationship which arises from an express or implied agreement between two or more parties to undertake some common objective for their mutual benefit. More narrowly defined, a joint venture is a separate legal entity formed by two...
Venture Philanthropy – An Introduction
According to Social Venture Partners, venture philanthropy means "funding organizations that support enterprising nonprofits and social entrepreneurs with not only financial resources, but also management and technical support as well. This support is focused on enabling nonprofits to build greater organizational capacity and infrastructure via long term, engaged relationships...
Social Enterprises – Some Basics
The Social Enterprise Alliance (SEA), a 501(c)(3) membership organization devoted exclusively to building sustainable nonprofits through earned income strategies, defines social enterprise as: an organization or venture that advances its social mission through entrepreneurial, earned income strategies. San Francisco-based REDF, a 501(c)(3) organization formerly known as The Roberts Enterprise...
Google.org – Not a Nonprofit
Google.org, self-referred to as the philanthropic arm of Google, was featured in the September 13, 2006 issue of The New York Times. The interesting aspect of Google.org, which will focus on on several areas including global poverty, energy and the environment, is that the organization has been established as...