One of the most asked questions of Funds2Orgs is what the difference is between a social enterprise and micro-enterprise? Sure, we know that it’s a little confusing. But we’re here to help!
Applying Business Strategies
Let’s begin with the work and goals of a social enterprise. First, different definitions exist for the meaning of a social enterprise, depending on the country. But in the U.S., this type of group applies business ideas to make money and also improve society. Second, for-profit and nonprofit social enterprises exist. For instance, Funds2Orgs is a for-profit social enterprise. And it makes a profit but also improves the lives of people around the world.
One of the ways we decided to make a social impact is to create the Funds2Orgs Micro-Enterprise Curriculum for teachers. In short, the curriculum is for home schools, elementary, middle schools, and high schools. And because it’s aligned with Common Core, it meets the educational standards for subjects such as Math, English, Science and Social Studies.
Social Enterprise
Social enterprises offer innovative solutions to the tough issues facing society as a whole. Meaning, things like poverty, access to clean water, medicine, education, etc. And by applying market ideas to find solutions, money and commerce become elements aspect of the work. For example, a nonprofit social enterprise may help toward the eradication of poverty. So it could sell the products from people in developing nations to others in the United States. In other words, a nonprofit social enterprise could create a platform allowing families living in poverty to find a market for their products outside of their local communities.
A social enterprise helps to improve the world in the following ways:
- Creates jobs
- Sustainability
- Protects the environment
- Provides a bridge or opportunities for jobs
- Reinvests profits into a community in a developing nation
- Provides vital services
Micro-Enterprise
The idea of micro-enterprises existed for a long time, so it’s not a new concept. Because of poverty, micro-enterprise in developing countries like Haiti, India or Uganda are critical. Meaning, limited work exists. And even education isn’t guaranteed to every child. And that only makes things harder when people come of age.
Micro-enterprises exist as small businesses, usually run by one or two people. Sometimes, family members help each other with employment opportunities through their micro-enterprise. As you know, it’s essential for people worldwide to make a sustainable living. And micro-enterprises provide people a chance to create their work opportunities for a living.
Funds2Orgs and Micro-Enterprise
When an organization does a shoe drive fundraiser with Funds2Orgs to raise money, the group will collect gently worn, used and new shoes. Well, those shoes eventually get picked up by Funds2Orgs and consolidated with thousands of others from other shoe drive fundraising events. Next, Funds2Orgs issues a check to our partners for the footwear collected.
What happens after is vital to our work. In short, the shoes collected in shoe drive fundraisers in the U.S. and Canada get shipped by us to partners in developing nations. Then, the shoes get sold for a fraction of their original cost to hub operators. Remember, this is about providing an opportunity for people to make money. So it’s essential that commerce is part of the solution. The hub operators purchase hundreds of thousands of shoes from Funds2Orgs. Ultimately, they resell the shoes to small micro-entrepreneurs in their communities with a minimal markup. In turn, micro-entrepreneurs sell the footwear for a profit.
Some of the micro-entrepreneurs we worked with in developing countries earned less than $2 a day for their families. Unfortunately, that’s considered extreme poverty. But by selling shoes they make over $60 a day—a sustainable living wage.
So, that’s how social enterprise and micro-enterprise organizations work. And it’s how Funds2Orgs partners not only with you but also micro-entrepreneurs worldwide.
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