Grameen Foundation -- Social Entrepreneurship

Recipient of the 2006 Nobel Peace Prize, Professor Muhammad Yunus is internationally recognized for his work in poverty alleviation and the empowerment of poor women. Professor Yunus has successfully melded capitalism with social responsibility to create the Grameen Bank, a microcredit institution committed to providing small amounts of working capital to the poor for self-employment. From its origins as an action-research project in 1976, Grameen Bank has grown to provide collateral-free loans to 7.2 million clients in nearly 80,000 villages in Bangladesh and 96% of whom are women. Over the last two decades, Grameen Bank has loaned out over 6.5 billion dollars to the poorest of the poor, while maintaining a repayment rate consistently above 98%. The innovative approach to poverty alleviation pioneered by Professor Yunus in a small village in Bangladesh has inspired a global microcredit movement reaching out to millions of poor women from rural South Africa to inner city Chicago. His autobiography, "Banker to the Poor: Microlending and the Battle Against World Poverty," has been translated in French, Italian, Spanish, English, Japanese, Portuguese, Dutch, Gujarati, Chinese, German, Turkish and Arabic.

Who we are

Mission Statement: Grameen Foundation's mission is to enable the poor, especially the poorest, to create a world without poverty.

With tiny loans, financial services and technology, we help the poor, mostly women, start self-sustaining businesses to escape poverty. Founded in 1997 by a group of friends who were inspired by the work of Grameen Bank in Bangladesh, our global network of 55 microfinance institution (MFI) partners, including our Growth Guarantee partners, has touched more than 34 million people in 24 countries. Our partners reach 6.8 million clients, and in addition, we introduced and now sustain technology initiatives (Mifos and Village Phone) in Cameroon, Kenya, Rwanda, and Uganda, bringing our total country outreach to 28.

Our team is guided by our values and our Grameen heritage, and our work is made possible by supporters who share our passion and commitment for defeating poverty through microfinance. We invite you to learn more about our work through our annual reports.

In this section:
Our People - The cadre of staff, board members and volunteers that help to nurture new ideas, innovations, and strategic thinking for fighting poverty.
Our Supporters - Individuals and organizations that share our passion and commitment for defeating global poverty through microfinance.
Annual Reports - They detail how we operate and where we work and spotlight the many people around the world we serve.
Our Grameen Heritage - The inspiration for the work we do.
Values - A compass that guides our decisions and programs
Awards and Recognition - External recognition of our work.
Partnerships - Strategic alliances that help to increase our impact.

What we do

Microfinance - a powerful poverty-fighting tool:

Microfinance helps people to escape poverty by giving them collateral-free loans and other financial services to support income-generating businesses. As each loan is repaid, the money is redistributed as loans to others, thereby mulitiplying its impact. For Fatima, a FONDEP client in Morocco, the loans have helped her build a business and new horizons for her children.

Learn more about microfinance

Client success stories

We support microfinance programs that enable the poor, mostly women, to lift themselves out of poverty and make better lives for their families. To do this, we partner with a worldwide network of microfinance institutions. Our work focuses on six key areas:

Supporting microfinance institutions

Our partner microfinance institutions (MFIs) work on the front lines daily, meeting the needs of clients and reaching out to others who can benefit from microfinance. To help them be efficient and effective and increase their outreach, we provide microfinance program support in the form of funding, technical assistance, training and new technology.

Harnessing the power of technology

Grameen Foundation's Technology Center is the leader in information and communications technology (ICT) initiatives that are dedicated exclusively to advancing microfinance. To help microfinance reach its full potential, we are driving industry-changing innovations that increase the efficiency of microfinance institutions' operations, create new microbusiness opportunities for the poor, and provide telecommunications access for the world's rural poor.

Connecting microfinance institutions with capital markets

Our Capital Management and Advisory Center is harnessing the vast resources of local and international capital markets to bring new financial resources to our microfinance institution partners. With more than 400 million poor people cut off from financial services, there is a huge, unmet need for microfinance. To reach them, MFIs need capital beyond the traditional philanthropic support to rapidly expand their operations and increase outreach.

Expanding microfinance industry knowledge

New ideas and innovative thinking will drive the expansion and effectiveness of microfinance. Knowledge sharing is an important component of our work. To have the greatest impact on global poverty, we are committed to sharing ideas and innovations with the wider microfinance community. We hope this "open-sourcing" of information will guide other organizations in improving the industry's outreach to the more than one billion people living in abject poverty.

Equipping the microfinance industry with measurement tools

A goal of Grameen Foundation’s work is to ensure our partners are moving their clients out of poverty after five years and to foster good practices for measuring the progress of individuals’ movement across poverty lines. MFIs must show results, yet many do not have the tools to evaluate how well they are fulfilling their mission of reducing poverty, reaching people excluded from financial services, empowering women, or promoting community solidarity. Grameen Foundation's Social Performance tools are designed to fill that need.

Social Business

In January 2008, Nobel Laureate Muhammad Yunus introduced a new term to the business lexicon: social business. Writing in his new book, Creating a World without Poverty, Yunus laid out the framework for two social business models and urged others to adopt them in the fight against global poverty. A social business is social-objective driven. In the first model, the company’s mission is achieved through creating or supporting sustainable "non-loss" business enterprises where all of the profits are ploughed back into the company rather than being distributed to shareholders. The second social business model is one which is profit-driven, but owned and operated entirely by the poor, who receive all company profits.

Learn more about social business on the Grameen Foundation blog.

Grameen Capital India and Grameen-Jameel Pan Arab Microfinance Limited are two social businesses that have already been launched with the support of Grameen Foundation.

Our People
To coordinate the activities of the Grameen Foundation network, we have staff based in Washington, D.C. and at the Grameen Technology Center, Seattle. Overseeing the staff is a Board of Directors. Our Grameen Foundation Advisory Council and our Board Committees and Councils nurture new ideas, innovations, strategic thinking and program development. Much of Grameen Foundation's work is done by our network of volunteers who are committed to our mission, some of whom have been working in partnership with us for more than ten years.

Where we work
Grameen Foundation works to reach the world's poorest people across four continents:
Learn more about our worldwide programs:

South Asia
East and Southeast Asia
Latin America and the Caribbean
The Arab World (Middle East and North Africa)
Sub-Saharan Africa
The United States

Banker to the poor

Professor Muhammad Yunus established the Grameen Bank in Bangladesh in 1983, fueled by the belief that credit is a fundamental human right. His objective was to help poor people escape from poverty by providing loans on terms suitable to them and by teaching them a few sound financial principles so they could help themselves.

From Dr. Yunus' personal loan of small amounts of money to destitute basketweavers in Bangladesh in the mid-70s, the Grameen Bank has advanced to the forefront of a burgeoning world movement toward eradicating poverty through microlending. Replicas of the Grameen Bank model operate in more than 100 countries worldwide.

Born in 1940 in the seaport city of Chittagong, Professor Yunus studied at Dhaka University in Bangladesh, then received a Fulbright scholarship to study economics at Vanderbilt University. He received his Ph.D. in economics from Vanderbilt in 1969 and the following year became an assistant professor of economics at Middle Tennessee State University. Returning to Bangladesh, Yunus headed the economics department at Chittagong University.

From 1993 to 1995, Professor Yunus was a member of the International Advisory Group for the Fourth World Conference on Women, a post to which he was appointed by the UN secretary general. He has served on the Global Commission of Women's Health, the Advisory Council for Sustainable Economic Development and the UN Expert Group on Women and Finance.

Professor Yunus is the recipient of numerous international awards for his ideas and endeavors, including the Mohamed Shabdeen Award for Science (1993), Sri Lanka; Humanitarian Award (1993), CARE, USA; World Food Prize (1994), World Food Prize Foundation, USA; lndependence Day Award (1987), Bangladesh's highest award; King Hussein Humanitarian Leadership Award (2000), King Hussien Foundation, Jordan; Volvo Environment Prize (2003), Volvo Environment Prize Foundation, Sweden; Nikkei Asia Prize for Regional Growth (2004), Nihon Keizai Shimbun, Japan; Franklin D. Roosevelt Freedom Award (2006), Roosevelt Institute of The Netherlands; and the Seoul Peace Prize (2006), Seoul Peace Prize Cultural Foundation, Seoul, Korea. He is a member of the board of the United Nations Foundation.

Nicholas Chan

Nicholas Chan, born November 14, 1978 is now a successful entrepreneur/venture capitalist. He is helping young people who are interested in starting up their own business. His first successful venture was when he was 17 years old. Nicholas together with his secondary classmate Benjamin Soon set up an IT Solutions company. And he was either setting up his own companies after that or joining others.

He then became a volunteer for the Project: Senso Ltd. which aspires to encourage the spirit of enterprise to the youth residents of Singapore. He was also a part of another non-profit organization called Social Creatives Ltd. Up to now he is the executive director of two companies namely, Azione Capital Pte Ltd. and Executive Publishing Pte Ltd.

“Social entrepreneurs are not content just to give a fish or teach how to fish.They will not rest until they have revolutionized the fishing industry"

quoted by: Bill Drayton, CEO, chair and founder of Ashoka

Social Entrepreneurship is applying innovative, sustainable, and practical approaches for the society’s benefits especially for the poor. Its main focus is to have a big social improvement.

Canadian Social Entrepreneurship Foundation, a sixty percent virtual organization, conceptualized in 2003 with the intentions to be more innovative and to reach out the gap between government sectors, not for profit, and businesses. For the CSEF, they can bridge the gap by being a major for in Social Entrepreneurship and by providing blended value for innovation.

JL Carvalho, the founder of CSEF says that their organization exist in order to educate, recognize, and fund existing and emerging Canadian and Global Social Entrepreneurs. CSEF invests more on Canadian social enterprises that produces revenues focusing on social inventors, children and youth, women at risk, aborginal youth ventures, environment, health, civic engagement, economic development, technology social enterprises/intellectual property based social ventures/social software (Example: efficient technology to maximize impact of social sector organizations).

“Profit should not be the only reason that businesses exist…”- Muhammad Yunus

Muhammad Yunus, a Bangladesh banker and economist, was the one who developed the concept of microcredit. He gives loans in small rates for those people who want to create business but doesn’t have enough money. He built the Grameen Bank in 1983 to make loans for the poor in Bangladeshis.

The main intention of his bank is to lend money for the people who had nothing. Traditional banks, do not want the concept of having small loans with a low interest rate, for they are afraid that they might not be repaid. Yunus, on the other hand believed that the poor would repay the money that they borrowed. M.Y, did not failed on doing this, the Grameen Bank he established received a Noble Peace Prize award in 2006, because of his efforts to improve the economy through social entrepreneurship.

“It is a company which is focused on the social good and which makes a profit, but it is not focused on maximizing its profits. I am not interested in turning all profit-oriented companies into socially conscious operations. They are two different categories of companies -- there will always be businesses whose primary goal is that of earning as much money as possible. That is okay. But earning as much money as possible can only be a means to an end, not an end in itself. One has to invest money in something meaningful -- and I would make a case for it being something that improves the quality of life for all people.” Dr. Yunus said this on one of interviews in Spiegel Online.

Truly, Dr. Yunus helped a lot of people. He believed that the poor doesn’t ask for charity and charity is not the solution to poverty. He does not only do business just to maximize profits like other companies do. There’s a need for a lot of companies who do not only focuses on the profits they are earning, but that of providing greatest benefits for human kind.

Helping Hand

By: Icy Luzano

Philippine Youth Business Foundation (PYBF), is a nonprofit, non stock organization under the Prince of Wale’s Youth Business International (YBI) network. It aims to empower the next generation of entrepreneurs and eventually bridge the unemployment gap in the country.

The PYBF provides start up funds from P15,000 to P200,000 to deserving would-be entrepreneurs between the ages 18 and 30 who have clear business ideas. A mentor is then assigned to give continuing business advice to the beneficiary.

Since 2003, the PYBF has turned a total of 19 young Filipinos into businesspeople. Their businesses have in turn created a total of 56 jobs.

John Baybay, the PYBF executive director says that PYBF hopes to fill the vacuum left by banks and microfinanciers, which are unlikely to lend cash to people who have just stepped out of college.

PYBF has a panel that assesses not only how much potential beneficiary needs but also helps figure out which business plan is the most feasible. It also provides young entrepreneurs access to other business networks.

Besides creating jobs, the PYBF program also helps young entrepreneurs avoid bureaucracy and red tape usually encountered in government-run or private financing institutions. More importantly, it gives an option to young Filipinos who would otherwise leave and work abroad to earn their livelihood.

Rags in Fashion

At the nation’s rag capital, a group of priests, young professionals, and a top fashion designer collaborate on a social enterprise with a fashion statement [By Nia Terol]

If someone were to tell you that they had just come from Payatas wth an upscale fashion fund, you would likely think you had heard it all wrong. The word “Payatas,” after all, connotes images of destitute surroundings- a squalid area where impoverished families live atop mountains of garbage. It is hardly the environment you would expect for creativity and innovation, yet this is what Rags to Riches (R2R), a social development enterprise, found when it dug deeper into the Payatas situation.

Bro. Javy Alpasa, S.J., a Jesuit scholastic who ministers to the community around the Payatas dumpsite, relates that although he had seen clear evidence of pastoral growth among the Payatas folk, their economic circumstances had not been improving alongside with it. He then pondered the situation with a group of young professionals who wanted to do something to help.
Their assessment: Although Payatas had become well-known as the “rag capital of the Philippines,” the nanays [literally “mothers,” but here it means “women”] producing the rags were making only a measly P1 for each rag sold. In contrast, the retailers were making in huge profits of as much as P15 to P20 per rag.

They suggested this solution: eliminate the middlemen and add value to the merchandise so the nanays can make more money from their efforts.

With the donation of 2 students from Bro. Javy’s theology class at the Ateneo de Manila University, Rags 2 Riches was born.

The original idea of the young professionals was to create “designer rags” that could be sold to the market at a premium. They came up with so many ideas and took so many steps to make this happen, but to no avail. Eventually, however, through a series of serendipitous events, they ended up at the doorsteps of Rajo Laurel, one of Asia’s top fashion designers.

The end result of that meeting was an initial line of 11 well-designed accessory products made from rags- bags, totes, purses, and other personal items- under the “RIIR by Rajo” brand. They were to become an instant hit among the upscale, socially aware fashionista crowd.

Aside from Rajo Laurel, several other first-rate professionals volunteered their services to make the R2R product launch possible. Among them were Jake Versosa for photography, Krista Ranillo for endorsements, Maylin Vergara of the beauty salon, Propaganda for makeup and styling, popular events director Robbie Carmona, and the models from the Philippines’ Next Top Model search who graced the R2R launching event.

Part of R2R’s long-range plans is to also venture into men’s accessories and home accessories for both domestic and export markets.

Bro. Javy makes this observation abouy R2R’s social enterprise model: “It’s a win-win formula. The Payatas women earn more over time, certainly more than what they could make from time deposits or from putting up other enterprises. The adage ‘A high tide raises all boats’ rings true here.”

Indeed, the experience of R2R has shown that in social development, encouraging productive social partnerships between and across sectors is much better than espousing one-way philanthropy and charitable dole outs to the poor. This is because such productive social partnerships and to compete well with other businesses to survive and thrive.

SOURCE: ENTREPRENEUR magazine Philippines, March 2008 issue

Entrepreneur of the year - Cecilio Pedro

If there is an entrepreneur who does not have the word "loss" in his vocabulary because he believes that anything and everything can be an opportunity, it is Lamoiyan CEO Cecilio K. Pedro. Further, he has shown how an opportunity can transform into one's lifework.

In the late 1970s, Pedro’s Aluminum Containers, Inc. stood as the major supplier of aluminum collapsible toothpaste tubes to Colgate-Palmolive and the Philippine Refining Company (PRC). Aluminum Containers, Inc. enjoyed profit growth due to the increasing demand from the country’s leading toothpaste manufacturers.

However, in 1985, these companies began using plastic laminated tubes. Although this caused Pedro to close his factory, he realized his old equipment could still be put to good use. Two years later, he reopened his factory as Lamoiyan Corporation, now known as the manufacturer of toothpaste brands Hapee and Kutitap. Lamoiyan is the Cantonese name of his late grandmother – the first Christian in their family – and who remains his inspiration to this day.

Cecilio Pedro poses with the Socially Responsible Entrepreneur Of The Year award presenters Mr. Alfredo M. Velayo, Chairman Emeritus of the SGV Foundation; and Ms. Doris Magsaysay Ho, 2003 Socially Responsible Entrepreneur

With perseverance and effective advertising, and by selling his product at a price 30% lower than the leading brands, Pedro succeeded in making Hapee the No. 3 toothpaste brand in the country.

While enjoying the success of being the first Filipino to ever penetrate the toothpaste market that has been dominated by multinational companies, Pedro has chosen to use his entrepreneurial skills to help provide opportunities to others. A staunch advocate of the hearing impaired, Pedro helps provide free college education to at least 200 deaf-mute students through the Deaf Evangelistic Alliance Foundation, Inc. (DEAF), which he currently chairs. Pedro also employs over 30 deaf-mute staff in his company, and helps provide them with free housing. To narrow the communication gap between his hearing-impaired and hearing personnel, Pedro has also required his managers to learn sign language.Of these three aspects, Pedro puts a premium on creating means by which his people can grow spiritually. His company holds regular Bible studies and prayer meetings to help make food for the soul. Their singular corporate motto is “To make a difference for the Glory of God.”

The Age of Ambition

By NICHOLAS D. KRISTOF
Published: January 27, 2008

On the Ground

Nicholas Kristof addresses reader feedback and posts short takes from his travels.

With the American presidential campaign in full swing, the obvious way to change the world might seem to be through politics.

But growing numbers of young people are leaping into the fray and doing the job themselves. These are the social entrepreneurs, the 21st-century answer to the student protesters of the 1960s, and they are some of the most interesting people here at the World Economic Forum (not only because they’re half the age of everyone else).

Andrew Klaber, a 26-year-old playing hooky from Harvard Business School to come here (don’t tell his professors!), is an example of the social entrepreneur. He spent the summer after his sophomore year in college in Thailand and was aghast to see teenage girls being forced into prostitution after their parents had died of AIDS.

So he started Orphans Against AIDS (www.orphansagainstaids.org), which pays school-related expenses for hundreds of children who have been orphaned or otherwise affected by AIDS in poor countries. He and his friends volunteer their time and pay administrative costs out of their own pockets so that every penny goes to the children.

Mr. Klaber was able to expand the nonprofit organization in Africa through introductions made by Jennifer Staple, who was a year ahead of him when they were in college. When she was a sophomore, Ms. Staple founded an organization in her dorm room to collect old reading glasses in the United States and ship them to poor countries. That group, Unite for Sight, has ballooned, and last year it provided eye care to 200,000 people (www.uniteforsight.org).

In the ’60s, perhaps the most remarkable Americans were the civil rights workers and antiwar protesters who started movements that transformed the country. In the 1980s, the most fascinating people were entrepreneurs like Steve Jobs and Bill Gates, who started companies and ended up revolutionizing the way we use technology.

Today the most remarkable young people are the social entrepreneurs, those who see a problem in society and roll up their sleeves to address it in new ways. Bill Drayton, the chief executive of an organization called Ashoka that supports social entrepreneurs, likes to say that such people neither hand out fish nor teach people to fish; their aim is to revolutionize the fishing industry. If that sounds insanely ambitious, it is. John Elkington and Pamela Hartigan title their new book on social entrepreneurs “The Power of Unreasonable People.”

Universities are now offering classes in social entrepreneurship, and there are a growing number of role models. Wendy Kopp turned her thesis at Princeton into Teach for America and has had far more impact on schools than the average secretary of education.

One of the social entrepreneurs here is Soraya Salti, a 37-year-old Jordanian woman who is trying to transform the Arab world by teaching entrepreneurship in schools. Her organization, Injaz, is now training 100,000 Arab students each year to find a market niche, construct a business plan and then launch and nurture a business.

The program (www.injaz.org.jo) has spread to 12 Arab countries and is aiming to teach one million students a year. Ms. Salti argues that entrepreneurs can stimulate the economy, give young people a purpose and revitalize the Arab world. Girls in particular have flourished in the program, which has had excellent reviews and is getting support from the U.S. Agency for International Development. My hunch is that Ms. Salti will contribute more to stability and peace in the Middle East than any number of tanks in Iraq, U.N. resolutions or summit meetings.
“If you can capture the youth and change the way they think, then you can change the future,” she said.

Another young person on a mission is Ariel Zylbersztejn, a 27-year-old Mexican who founded and runs a company called Cinepop, which projects movies onto inflatable screens and shows them free in public parks. Mr. Zylbersztejn realized that 90 percent of Mexicans can’t afford to go to movies, so he started his own business model: He sells sponsorships to companies to advertise to the thousands of viewers who come to watch the free entertainment.

Mr. Zylbersztejn works with microcredit agencies and social welfare groups to engage the families that come to his movies and help them start businesses or try other strategies to overcome poverty. Cinepop is only three years old, but already 250,000 people a year watch movies on his screens — and his goal is to take the model to Brazil, India, China and other countries.

So as we follow the presidential campaign, let’s not forget that the winner isn’t the only one who will shape the world. Only one person can become president of the United States, but there’s no limit to the number of social entrepreneurs who can make this planet a better place.

Source: http://www.nytimes.com/2008/01/27/opinion/27kristof.html?_r=1

Muhammad Yunus: A Nobel laureate Banker envisions an end to poverty

Article by Ishaan Tharoor

In 1974, famine gripped Bangladesh. Hundreds of thousands died and millions became destitute. "Villagers had to borrow loan sharks on terrible conditions," says Muhammad Yunus, "and some even became slave labor for the money lenders." For Yunus, who had just returned to Bangladesh as an economics professor after completing his Ph.D. in the U.S., it was wrenching to discover how meaningless his academic achievements were in the midst of all this suffering. Hoping to cure his own sense of helplessness, he wandered the muddy lanes of a village next to his university, searching for ways to help. Little did he know that this nervouse exploration would plant the seeds of an economic miracle still blooming decades later.

Yunus compiled a list of the village's 42 most impoverished and went about repaying each of their debts for a paltry total of $27. While banks would never lend money to these ofther illiterate and undocumented peasants. Yunus simply asked that they work hard and repay him "when they could." He recalls: "It was a big shock that just a little money could make people so happy. With the money they could become free."

This is the operating ethos of the Grameen Bank, which Yunus founded in 1983 and which has since extended microloans to 6.6 million people in Bangladesh, most of them women. "Conventional banks look for the rich," says Yunus. "We look for the absolutely poor." As Yunus sees it, credit is a human right, enabling a person "to unwrap that gift of one's self and find out who he is." Yet the concept he pioneered has proved to be much more than kind-hearted charity: 99% of Grameen's borrowers repay their debts --despite the fact that they borrow without providing collateral -- and the bank makes a modest profit.

Inspired by his success, many others have embraced Yunus' concept. From the U.S. to Uganda, over 100 million people are now enrolled in various microedit schemes. Prominent global figures otherwise at each otehr's throarts, such as Paul Wolfowitz, head of the World Bank, and Hugo Chavez, the leftist President of Venezuela, have all praised Yunus' achievement. And, on Oct. 13, Yunus received the most extraordinary endorsement yet, becoming the first businessman ever to win the Nobel Prize for Peace. As the news broke, his entire country celebrated. Prime Ministed Khaleda Zia heralded him as "the pride of Bangladesh," while thousands flocked to Grameen's headquarters in the suburbs of Dhaka to congratulate their hero.

For Yunus --whose father struggled to support 10 children as the owner of a tiny ornaments shop in the City of Chittagong --the Nobel is an almost unimaginable accomplishment. But his ambitions are far bolder than this. Yunus insists it's possible to eradicate global poverty within two generations with microedit uplifting countless millions. "At the rate we're heading, we'll halve total poverty by 2015," he says. "We'll create a poverty museum in 2030."

Reference: www.time.com

An inclusive definition of Social Entrepreneurship

My definition of social entrepreneurship clearly allows more individuals, ideas, opportunities, and organizations into the tent. As I wrote in the Fall 2006 Stanford Social Innovation Review, the question is not whether social entrepreneurs exist—that much is certain in the most cursory sampling of the Ashoka and Echoing Green fellowship winners from recent years, most notably Muhammad Yunus. Rather, the question is whether the field is too exclusive for its own good. By defining social entrepreneurship more by the characteristics of the individual entrepreneurs who forge social value through their work, I wrote that “the field may have excluded large numbers of individuals and entities that are equally deserving of the support, networking, and training now reserved for individuals who meet both the current definitional tests of a social entrepreneur and the ever-growing list of exemplars.” Hence, my 2006 definition of social entrepreneurship was more inclusive. As I wrote, social entrepreneurship is an effort by an individual, group, network, organization, or alliance of organizations that seeks sustainable, large-scale change through pattern-breaking ideas in what governments, nonprofits, and businesses do to address significant social problems. Between 2006 and 2008, I shortened the definition to focus more precisely on efforts to solve intractable social problems through pattern-breaking change, thereby reserving the question about who acts as an entrepreneur and where entrepreneurial activity occurs for further research. My old definition focused on the kind of systemic change that Martin and Osberg highlighted as essential for creating a new social equilibrium. But I also embraced a set of underlying assumptions that increased my definition’s inclusiveness, most notably the notion that entrepreneurs do not always invent alone. Instead, social entrepreneurship can come from small groups or teams of individuals, from organizations, networks, or even communities that band together to create pattern-breaking change. By challenging the notion that socially entrepreneurial activity is the product of a 24/7 entrepreneur who perseveres against the odds, my old definition provided a bigger tent for social entrepreneurship. My 2006 definition also embraced the possibility that the quantity of socially entrepreneurial activities varies across individuals and organizations, meaning that organizations might be somewhat or moderately socially entrepreneurial, while still meeting a more traditional charitable mission. My definition also focused on the notion that some individuals and organizations might even stop their socially entrepreneurial activities to concentrate on strengthening their operations or because of stall points, funding crises, or leadership transitions. Not surprisingly, perhaps, given the field’s focus on a relatively small number of social entrepreneurs, my definition provoked intense reactions within the field, especially given my assumption that social entrepreneurs might not be as rare as imagined. In questioning the “cult of personality” that surrounds charismatic entrepreneurs, I had implied that individuals were somehow unimportant to social entrepreneurship. My more inclusive view of social entrepreneurship almost certainly reflects my bias as an educator. As I have argued before, the amount of social entrepreneurship can be increased by supporting more potential entrepreneurs as they cross over to actual engagement. This is the core belief at New York University’s Robert F. Wagner School of Public Service, which houses the Catherine B. Reynolds graduate and undergraduate fellows program on social entrepreneurship. The effort is based on the belief that social entrepreneurs can be identified early in their careers and given the skills and coaching to engage in socially entrepreneurial activity as soon as possible. Some will start new ventures, others will join entrepreneurial organizations, and still others will engage whole communities in the search for change.

Source: http://www.socialedge.org

Social Entrepreneur Illac Diaz: It's Possible To Change The World

By Artessa Saldivar-SaliJune 11, 2006 Philippine Star

Entrepreneurship skills can be mobilized for social change in addition to turning a profit. With creativity and vision, social entrepreneurs leverage business acumen and an eye for opportunity to meet pressing social needs. The article below tells of the successful initiatives of Illac Diaz, borne out of his approach to social entreprenueurship--bringing "the strengths, efficiencies and solutions of business to bear on problems of society."

The Philippine flag has been flying high and proud not just on the lofty peak of Mount Everest, but in the hallowed halls of the Massachusetts Institute of Technology in Boston. A team of young Filipino entrepreneurs has been winning competitions with innovative ideas that combine social relevance with business savvy.

Most recently, the team topped the MIT $100K Entrepreneurship Competition with their project CentroMigrante, a self-help business model that provides clean, safe and affordable urban housing for the thousands of Filipinos who come to Manila from the provinces to look for jobs as seafarers.

Earlier, the same team joined–and won–two smaller but no less prestigious competitions. In the IDEAS Competition, which allows members of the MIT community to develop creative ideas that make a positive impact on the world, the team took the grand prize with their First Step Coral project which uses a turbine powered by sea current to energize a wire frame on which corals grow four times faster than the normal rate. In an unprecedented feat, the same group also won the second prize for their replicable, low cost cement peanut sheller, which allows peanut farming communities to peel peanuts for planting up to 50 times faster than the traditional manual method.

The team also won the $1K Business Warm-up Competition for their Earth Classroom project, using locally available materials like soil to build classrooms in rural areas at half the cost.

The prime mover behind all these projects is Illac Diaz, a 30-something former actor, model, athlete and advertising executive turned social entrepreneur. As such, he has blazed a trail in combining social concern, business acumen and constant innovation. A keen observer of the marginalized groups of society, he uses this strength to transform small ideas for socially responsive businesses into acceptable large-scale models for meeting the needs of people who require immediate solutions to their problems. He applies business skills not for personal gain but for the practise of business with a wide social impact.

His most outstanding effort in community-oriented entrepreneurship is the landmark Pier One Seafarer's Dormitory, which provides clean, safe and affordable transient housing and services for thousands of maritime overseas Filipino workers and their families within the Manila area.

The idea for Pier One came during Illac's "serendipity walk," an exercise students at the Asian Institute of Management, where he obtained a Master in Entrepreneurship degree, go through. Students are asked to literally take a walk, observe and come up with business ideas. From his walk around the T.M. Kalaw area in Manila, where seafarers looking for jobs congregate daily by the thousands, Illac realized that no housing alternatives were available to this transient, low income group, who had to make do with squalid, cramped and dangerous living spaces usually in squatter areas while they waited for job placements, or while their papers were being processed.

Though the Philippines provides over 25 percent of the world's ship manning requirements and has adopted labor export as a national policy, it does not provide reliable housing for seafarers. Given the billions of dollars in remittances that maritime OFWs plow back into the Philippine economy, it is shameful that when these seamen come home, they have to struggle to find decent housing until their next assignment, which may not come for months. The government provides them with hardly any assistance beyond a token covered shed on the roadside. Recognizing this need, Illac set up a 40-bed dormitory in 2000, offering not just a place to sleep but also temporary employment opportunities, job search assistance and even skills upgrading. Today, Pier One is a 1,500 bed concern with branches in Intramuros, Recto and Ermita that has been operating sustainably, with profits invested back into the business, upgrading and expanding facilities. To date, over 80,000 seafarers have been served by the project. The Pier One prototype has evolved into the winning CentroMigrante project, which will offer a build-for-stay system wherein tenants will be given the option to construct the units from prefabricated parts in exchange for a period of free occupancy. There will also be a work-for-stay system where those without money may sign up for temporary jobs. The shelters will also provide skills seminars on career development, personal finance, remittances management and small businesses, and will coordinate with the 400-plus manning agencies to establish an onsite job board to help with job searches. The prototype system was able to reduce average waiting time for jobs from seven to three months. Another project, MyShelter Foundation, originated when Illac observed the lack of classrooms in the provinces, at the same time trying to find a way to solve the housing problem in Negros Occidental. Undertaking a thorough business analysis of the area, Illac noticed that the nearby adobe bridges, built by the Spanish hundreds of years ago, were still intact, resilient products of the earth itself. He did research in India where adobe houses are common, then underwent intensive training at the CalEarth Institute in California under the renowned Iranian architect Nader Khalili. He became an expert in the Earthbag Construction System, and found that this could be applied to the Philippines. By utilizing the endless supply of indigenous materials like soil and using local labor, cost of the houses and classrooms could be kept down, and money kept within the community. These savings in construction could then be applied to increase teachers' wages and bring computer technology to schools. The Day-Asan National High School in Surigao, with an enrolment of 273 students, currently holds classes in the basketball court and make-shift huts. Since the town was established 25 years ago, not a single classroom has been built, and students used to walk an hour and half each way to attend school in a nearby town. Local villagers have been trained and will build a six-classroom module using the Earthbag Construction System. The structure can be finished and used within 12 to 14 weeks. A project that will be launched within the month is the Peanut Revolution, which addresses the tedious task of manually peeling peanuts for planting, a task usually given to women, children and the elderly of the community. Using a simple cast cement sheller built like a large peppermill, whole peanuts are put in from the top, and as they fall into the inside rotor, the shells are slowly ground open, dropping the kernel without harming it. From a mere one kilo per hour when done manually, the process is increased to 27 kilos up to 50 kilos per hour with the sheller. Improvements include a foot pedal model, and one with a blower to automatically remove the crushed shells. Previous automated peanut shellers have been expensive and well out of reach of the average small peanut farmer. This simple model, made from fiberglass molds that can produce several hundred shellers, only costs around P3,000. Microfinancing programs have expressed willingness to fund its acquisition by small farmers. Illac and his group are also developing other simple, easily replicated cement agricultural machines that will increase farmer yields in a variety of crops. An international cement manufacturer is considering the project for implementation worldwide. Social enterprise is not just about the money and jobs that are the bottom line of any business, but more about a central mission to create sustainable models of social development where the measure of success is the number of people helped. Illac's successes have proven that focusing on human capital as being at least as important as equity capital in private interventions to social inequity is an idea whose time has come. Illac just completed a research fellowship in the Special Program for Urban and Regional Studies in the Department of Urban Studies and Planning at the MIT. At the Asian Institute of Management, he was the youngest ever to be awarded the Honors & Prestige for work in the field of social entrepreneurship. Last year, he became the first TOYM recipient for social entrepreneurship. Illac belongs to the Diaz clan that includes former Miss Universe Gloria Diaz; his mother is gallery owner and art patron Silvana Diaz. He was once a much sought after commercial model and sometime movie actor, but even when he was still in high school he already exhibited a penchant for social entrepreneurship. He founded the Usap-Kamay program where teachers from the Southeast Asian Institute for the Deaf (SAID) would teach Ateneo students sign language and they would in turn tutor SAID students in math, science and English. As an indication of its success, Usap-Kamay continues up to the present, with an annual average of 20 Ateneo participants and hundreds of alumni in the program. He also set up Good Guys Inc. and Sagittarius Copy Machines to help Metro Manila law students by eliminating the daily difficulty of lining up to photocopy legal cases for their classes, as well as bringing in better copying technology that minimized the health risk to machine operators from toxic liquid toners. Sports also figures prominently in Illac's already busy life. "My passion for sports has been with me ever since I was young," he relates. "I was a hyperactive child and the only way that my parents found to calm me down was by putting me into every sport possible. That way, once I came home I would be completely exhausted!" He was on the Philippine team to the Asian Youth Games and the Asian Games from 1988 to 1995, and was national decathlon champion from 1991 to 1993. He holds the UAAP records in track and field for the long jump, javelin, 400 meters and 4x400, and the Philippine record for the long jump. He also climbed mountains with the UP Mountaineers, which turned out to be "the perfect training" for what is now called adventure racing. He has participated in the Eduro Challenge, the Philips Survival Challenge, the Xterra Triathlon, the San Mig Challenge and the Inter-island Challenge. He was part of the Philippine team to five AXN Urban Challenges, and took part in the Marlboro Adventure and Tiger Beer Outdoor Quest. He sails with the Manila Yacht Club team, and even occasionally contributes to newspapers and magazines. Illac, whose name is an Aztec term meaning "God of Light," is in a unique position to inspire others with ideas, vision and passion to create enterprises that uplift sectors of society that would otherwise be forgotten. He is pioneering a whole new field of entrepreneurship, one that seeks to bring the strengths, efficiencies and solutions of business to bear on problems of society. He insists that true charity does not mean giving out cash, and that to engage in socially responsible endeavors automatically means financial struggle. Business and development can and must be working partners, and Illac Diaz is taking that path with resounding success.
Reference: http://www.truthforce.info/

Honesty Café: Only in Batanes

More than a cup of honesty: Honesty Café in Ivana, Batanes is a little store that provides refreshments to townfolk and travelers in the area. Anybody who enters the café can get food and drinks and drop whatever payment they feel like in a basket.

I went to Batanes for the first time after getting an invitation from a friend who was going there with her son. I decided that it was a good opportunity for me to go, and take my son along. Whatever I had heard previously about Batanes did not do justice to its beauty, as well as the goodness of its people, which I experienced during my trip. People there are content and do not live their lives preoccupied with thoughts of natural calamities — the events that, sadly, make Batanes familiar to us. Their homes are made of limestone which is naturally porous and resistant to earthquakes and typhoons. More importantly, every house is an architectural sight that makes one feel how much love and patience was put into the construction. I was amazed to hear about the community’s housing cooperatives. The neighbors help one another build homes for their families.

Batanes may be isolated, but it is no doubt a successful community where interdependence is the norm. The pervading culture dictates that it is a privilege to help and be helped, and almost an insult to receive payment.

While biking in one town called Ivana on the main island of Batan, I got fascinated with a relatively popular yet inconspicuous fixture — The Honesty Café. This little store was started by Aling Elena, a retired teacher who decided to provide refreshments to townfolk and travelers in the area. Anybody who enters the cafe can get food and drinks and drop whatever payment they feel like in a basket. While the items are tagged, the store is not manned. Some people drop their payment, others don’t. But it’s all okay with Aling Elena; her ultimate profit is the chance to awaken her customers’ consciousness to honesty and responsibility and to teach them to live these lessons in the other areas of their lives.

Together with her husband Jose, she toils the fields and takes pride in being a farmer. In her daily labor of love she prays, “God, please help me with my crops so I may share them with others.” As Elena and Jose talk about their 50th wedding anniversary on Valentine’s Day next year, it’s as though their celebration is already happening, every day. Their life together reinforces simple values: what you plant, you eat; what you sow, you reap; everything is abundant; everybody sees beauty.

I was overwhelmed by the simple and profound lessons of life that are the day-today experiences of the people of Batanes. Life is about thanksgiving, with Sundays being strictly for church service. To many of them, sharing their lives with one another and sincerely helping is the only way to prosper.

As I looked out at the fields, beaches and mountains of Batanes, talked to Aling Elena, Mang Jose and their community, I became more convinced that in simplicity lies majesty. Nature, when respected and nurtured, can provide us with everything that we need to live abundantly.

This is my experience of Batanes and its people. Life that is lived fully will lead us to knowing who we are and becoming what we are made to be. Giving starts with one person. It starts with one home. One woman prepares food with love. One man takes pride in his labor. One traveler pays the right amount. One child learns to share. A neighbor gives unconditional assistance. Everybody does the same. And we get blessed with a community called Batan in an island simply known as Batanes.

Source: www.philstar.com

Note: I first read the article from the Philippine Star news paper. I thought that it would be perfect for this blog post and so I searched for it in the net.
It just goes to show that in spite of all the ugly things in this world, there are still kind hearts. This is how social entrepreneurship moves mountains and touches our lives.

Muhammad Yunus gives Romanes Lecture

Nobel Laureate Muhammad Yunus who gave this year's Romanes lecture

Muhammad Yunus, Nobel Laureate and pioneer of microcredit, gave this year’s Romanes lecture last night on ‘A poverty-free world: When? How?’.

Yunus, who called himself “a compulsive optimist as far as poverty is concerned”, is one of the world’s leading proponents of economic advancement.

Speaking to a packed Sheldonian Theatre of University members and the public, he talked about his vision for a world free from poverty and criticised the “social failings of the existing capitalist system”, with particular reference to the global financial crisis.

'One major institution that needs to be redesigned is the financial institution', said Yunus. 'There is something fundamentally wrong with an institution that leaves out more than half the population of the world, because they are considered not credit-worthy.'

A Bangladeshi banker and economist, Yunus is famous for his successful application of microcredit - the extension of small loans to entrepreneurs too poor to qualify for traditional bank loans. He is the founder of Grameen Bank, which provides credit to the poorest people in rural Bangladesh to encourage the growth of very small business. 97% of its borrowers are women, and despite asking for no collateral the bank has a 98% repayment rate.

One major institution that needs to be redesigned is the financial institution. There is something fundamentally wrong with an institution that leaves out more than half the population of the world, because they are considered not credit-worthy.

Nobel Peace Prize winner Muhammad Yunas
In 2006, Yunus and Grameen Bank were jointly awarded the Nobel Peace Prize "for their efforts to create economic and social development from below." Yunus believes that, since credit is the last hope for those with no money, the right to credit should be recognized as a fundamental human right.'Banks explain that poor people are not credit worthy. But the real question to ask is whether banks are people worthy,' said Yunus in his lecture. 'In the context of the total collapse of the financial system, this question becomes more relevant and urgent. We are still in the midst of the worst financial crisis of the century. In Grameen Bank there are no legal instruments between lender and borrower, no guarantees, no collateral. You can’t get riskier than that, and yet our money comes back while the prestigious banks all over the world are going down with all their intelligent paperwork, all their collateral, all the lawyers and legal systems to back up their lending.'

Yunus called for social business, whose aim is the improvement of lives rather than profit. 'The financial crisis that has gripped the world economy illustrates the social failings of the existing capitalist system', he said.

The Romanes Lecture is an annual public lecture at Oxford University. The first was given in 1892 by William Gladstone. Subsequent speakers have included Theodore Roosevelt, Winston Churchill, Sir Isaiah Berlin, Iris Murdoch, Edward Heath, AJP Taylor, Tony Blair and Sir Paul Nurse.

Source: www.ox.ac.uk.com

Senen Bacani, Entrepreneur

Meet Senen Bacani. He is 61. He graduated from De La Salle University, commerce, summa cum laude. He has an MBA from the University of Hawaii East West Center, 1968. He used to be a secretary of agriculture. He is now chairman and president of La Frutera, Inc. Last week SGV Ernst & Young declared him the 2006 Entrepreneur of the Year, besting more than 50 other aspirants.

Senen started his career in Dole Food Co. in Honolulu after graduating with his MBA. Over the next 20 years, he quickly rose from the ranks, becoming country manager of Dole in Costa Rica and in the Philippines. In 1989, the then 41-year-old technocrat was appointed secretary of agriculture by President Corazon Aquino, herself a sugar-plantation owner.

Senen and his colleagues, however, wanted to operate their own banana plantation. They approached Chiquita Unifrutti International, a Middle Eastern family-owned business that had plans of introducing Chiquita bananas to the Japanese market.

He saw potential in the Autonomous Region in Muslim Mindanao (ARMM), with its fertile and undeveloped land, good climate, and readily available and cost-efficient workforce. However, during his visits to the ARMM, he became concerned about resolving the separatist rebellion in Mindanao.

Senen convinced Chiquita Unifrutti that the region, although farther from ports, paid lower wages and promised higher productivity. In 1996, Ultrex and Chiquita Unifrutti established La Frutera, Inc., a 1,000-hectare Cavendish plantation in Buluan and Datu Paglas, Maguindanao.
La Frutera was the first large-scale banana plantation in the ARMM. Ultrex and Chiquita Unifrutti formally agreed to a 20-year contract wherein Chiquita Unifrutti would buy La Frutera’s bananas, market them under the Chiquita and Unifrutti brands, and then export them abroad.

Senen’s partner is Datu Paglas, a former rebel leader who has his own business firm, Paglas Corp. “The business is good,” Paglas told me.

There are 45,000 hectares of banana plantations in the country. Among them is La Frutera. It is one of the top 10 percent banana farms in terms of production per hectare, cost per box, and quality of products in the market. It exports bananas to Japan, Korea, China and the Middle East. La Frutera is the only banana plantation in the country certified by both the Rainforest Alliance (since 2003) and ISO 14001 (since 2005).

La Frutera employs 1,745 people, 90 percent of whom are Muslims and 10 percent are Christians. Among the staff are a few hundred former rebels of the Moro National Liberal Front and the Moro Islamic Liberation Front. Many of the middle-level management positions are now occupied by Muslims.

Over the past 10 years, La Frutera has shown how a business model can succeed in a conflict-ridden area previously bedeviled by lawlessness, underemployment and interethnic violence. He believes that providing jobs, especially in rural areas, is the direct and sustainable way of alleviating poverty.

“We can’t keep on waiting for peace to come first. The reason why there’s no peace is that there’s no development.” –Senen Bacani

Source : http://www.manilatimes.net/