Debt Relief for Social Entrepreneurs

In the business world, it’s par for the course to move on when a project has proven financially unviable. Those who identify as social entrepreneurs can be more stubborn, at their own expense. They don’t necessarily move on when our projects have proven financially unviable.

They keep going, at first turning to philanthropic capital(where available, and it seldom is) and then, too often, to their credit cards. Some of them move on only when the money’s gone, passion muted, and monthly minimum payment so high that they have no choice but to abandon the work they love.

 

I fear that cash-strapped social entrepreneurs are becoming too dependent on the only reliable source of funding for social innovation, Mastercard and Visa. They have few alternatives. Large-scale funds created to advance the sector are bureaucratic and risk-averse by design. One-off funding sources for socially innovative organizations are too few in number and rarely come with deep enough pockets to stabilize a social venture.

 

A perfect storm has formed around the failure of philanthropic capital to address the needs of social entrepreneurs, the ease with which personal debt can be accessed, and the stubborn enthusiasm that social innovators often bring to their projects.

 

The damage this storm can cause is tremendous. The cost is nothing short of social entrepreneurship losing its brightest and most passionate to more stable if less socially-minded careers.

 

We would all be well-served to think of cash-strapped social entrepreneurs as too small to fail. Despite their small size today, many carry the blueprint for a program that could significantly advance a social issue or improve society in 5, 10, or 20 years. The field of social entrepreneurship shouldn’t be putting social innovators in situations where they need to choose between selling equity in themselves, paying the credit card companies’ exuberant fees, or leaving the work they love.

 

How do we build debt relief into the social entrepreneurship eco-system to ensure the growth and development of world-changing innovations, and the innovators behind them?