Reversing the Pyramid through Social Enterprise 2/2

Edgard Barki, Head of the Entrepreneurship Research Center at FGV Brazil, base of the pyramid researcher and expert on social enterprise, shares Part 2 of his experience on the Brazilian testing ground.  

Hatching social entrepreneurs

Edgard Barki is involved in an innovative project to build an incubator dedicated to nesting social enterprises. ‘In Brazil, most social entrepreneurs come from the high income classes trying to solve a problem of the base of the pyramid,’ he states. Inversely, the objective of the incubator, NIP, is to accelerate and support social entrepreneurs that come from the peripheries of São Paulo city. NIP will see the light of day thanks to a partnership between FGV – a foundation created in 1944 and home to a cluster of leading South American higher education institutions – Artemisia, the largest Brazilian accelerator of social enterprises and A BANCA, a social organization with grassroots in the outskirts of São Paulo city.

The focus of the incubator is to find and foster entrepreneurs that have a social impact and need management tools. Workshops and mentoring will be the staple diet during a six-month period, after which fledgling social entrepreneurs will present a business plan and, depending on the quality and perspective of the business offer, gain access to a seed fund of US$ 7,000 and another six months of mentoring.

For the first semester of 2018, the NIP has mapped 51 social enterprises, five of which have been selected for acceleration. The whole process will be based at A BANCA, placed at the heart of the community, close to the entrepreneurs, and with an unparalleled knowledge of both the entrepreneurs themselves and the challenges they face.

There are still many obstacles to surmount when it comes to social enterprise, notably that of finding good business models that are at the same time characterized by effective social impact and the potential to scale up and be financially sustainable. Pressing too, is the need to support social entrepreneurs in managerial skills and to offer a higher variety of access to capital. ‘Most investments currently available are for the beginning of the operation,’ says Prof. Barki, ‘or else are aimed at well-developed businesses. There is a gap in the support and investment offered to small organisations that have an already-proven sales record, but aren’t yet prepared to raise bigger capital.’ But as business with a societal purpose slowly but surely gains ground in Brazil and around the world, maybe these young birds need to sing louder that their bold enterprise is able to effectively hit several others with one stone.

Read Part 1 of Edgard Barki’s article

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