Social Enterprise Header showing a variety of types

Types of Social Enterprises

A social enterprise can be established in various structures ranging from a grant-funded charitable organization to a purely for-profit business. The following are examples of social enterprises:

  • Charity/Non-Profit with Related Business - A grant or donor funded non-profit that operates a business which sells goods or services. Revenues are redirected back into the non-profit to assist in the delivery of not-for-profit services.
  • Social Purpose Business - A for-profit business that exists with the primary purpose of social or environmental goals. Profit is secondary, but required in order to pursue the primary goal.

The aim of a social enterprise is to achieve both a social return on investment and a financial return on investment, thus working towards a blended value return on investment.

Blended Value Return on Investment  

There are many non-profit organizations that operate social enterprises.  Their aim is to fill a community need in the market, advance their mission and contribute to financial sustainability.  There are three models of social enterprise a non-profit should consider:

  • A subsidized social enterprise – These businesses rely on subsidized funding to support operational costs. I.e. Training subsidies
  • A self-sustaining social enterprise - These businesses do not receive grants, though are able to cover operational costs fully with sales revenues.
  • A profitable social enterprise – These businesses have income that exceed expenses and are profitable operating social enterprises.

Non Profit Continuum

                 Traditional Model               -           Social Enterprise Models

Traditional model -

Source: Canadian CED Network Manitoba

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