One of the biggest problems underlying the field of social entrepreneurship is – the structure of the social enterprise itself. Social enterprises operate in a wide array of social problems to create value and offer solutions. Due to the diversity of the social systems and the corresponding dynamics, social enterprises vary in their manifestations and business models. This has increasingly made it difficult to capture a unique framework or structure of social enterprise business models. In most cases it is apparent that social enterprises are structurally hybrids in several dimensions. In general, it is assumed that social entrepreneurs aspire to create social value by addressing various social problems existing in societies. This aspiration, however, is not deviant from an economic objective as it can also aim to earn profits through the innovative business model. The traditional conceptualisation however, associates social enterprises largely with the notion of philanthropy or non-profit ventures. The duality of this identity has thus been a problem for social enterprises. Some social entrepreneurs are earning money through their ventures considering this as a more ethical way to do business, some are doing this with the mission to create social impact, while others are trying to create social value and develop a sustainable business model. The ambiguity of social enterprises also stems from the fact that there are no unique legislation or policies guiding how a social enterprise should operate.
Typically, the social enterprises fall under any of the following categories –
- NGOs – not-for-profit organisations that have an explicit social mission and funded by national and international donors.
- Social businesses – social ventures with an embedded social mission and operating as a non-loss, non-dividend company. The bottom line of such businesses is to operate without incurring losses while serving the people, and the planet, particularly disadvantaged people.
- Private for-profit social enterprises – start-ups and regular enterprises which are operated by a dual mission – social value creation, economic profit maximisation.
- Co-operatives – is an autonomous group of people who cooperate voluntarily for the sake of common economic interest, based on the values of equality, solidarity, self-help and democracy.