The Findings of This Massive Global Social Entrepreneurship Study Will Surprise You

The focus is shifting from money in the bank to society's biggest challenges.

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By Lindsay Friedman • Jun 3, 2016


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People across cultures, demographics and continents believe business is about more than making a profit -- it's about doing good for others. That's according to a new report released by the Global Entrepreneurship Monitor (GEM) assessing social entrepreneurship worldwide. The program, sponsored by Babson College and partnering institutions, provides snapshots of social entrepreneurship by region.

Researchers conducted interviews with 167,793 adults in 58 different economies in 2015. To gauge the prevalence of social entrepreneurship broadly, the researchers found a global average rate of 3.2 percent of individuals surveyed were in the startup phase of social enterprise last year.

Related: How One Man Made It His Business to Give Back

Social entrepreneurs not only focus on what goes into their pockets, but also on how they can use their platform to give back. In fact, about 52 percent of those included in the survey reinvested profits into social initiatives. In the U.S., many socially focused companies, such as Yoobi and Toms, have become household names. But trend trickles down to smaller economies. The study goes on to explain how the social entrepreneurship trend transcends education level in many regions.

"Social entrepreneurship is about people starting any initiative that has a social, environmental or community objective," says Siri Terjesen, a professor at American University who co-authored the report, in a press release. "It could be students who are starting a product that's based on recycled materials, or a group working to find a solution to irrigation problems in their neighborhood."

Though the popularity of such efforts seems to be far-reaching on the global scale, some countries were more entrepreneurial on the social side than others. For example, of the surveyed population in Senegal, 18.1 percent were pursuing social entrepreneurial activity. In contrast, Taiwan had a dismal rate of 1.3 percent. The U.S. and Australia were among the nations with the highest levels of activity, each at around 11 percent.

Related: What's the Best Way for Your Business to Give Back?

The frequency of commercial startup pursuits was of course found to be a bit higher, with all regions studied averaging about 7.6 percent. But some nations lead in both categories: Peru has a 10.1 percent rate of individuals working to launch social startups and a 22.2 percent rate of those who are in the process of getting commercial enterprises off the ground.

A gender breakdown also provided interesting insights, as the researchers discovered the world's social entrepreneurs are 55 percent male and 45 percent are female -- a significantly smaller gap compared with commercial counterparts.

"The social entrepreneurship gender gap is less pronounced than in commercial entrepreneurship where men trump women as business leaders 2:1," Terjesen says. "In social ventures, both genders are equally represented, suggesting that social entrepreneurship is a top business field of interest for women worldwide."

And while most would figure the majority of social entrepreneurs are of a younger demographic (typically between the ages of 18 to 34), that's not the case everywhere. In many areas -- including Australia and the U.S. -- about 60 percent or more of the proportion of those engaging in social entrepreneurship are older than 35.

How these business-folk get their start seems to be in a similar stride, as most use personal funds to get the wheels turning. For instance, the majority (about 60 percent) of those in this part of industry used their own funds to invest in their business in Southern and Eastern Asia, the Middle East and North Africa. However, sub-Saharan Africa had a low personal investment rate of about 30 percent.

So, what's the reason for the popularity of social entrepreneurship? Terjesen attributes it to the limited ability governments have to solve the increasingly prominent social issues in today's society. Although the growth in the number of socially minded companies is a big step toward achieving those goals, Terjesen says it's important to "determine the most appropriate ways to support social entrepreneurs and scale up their solutions."

Lindsay Friedman

Staff writer. Frequently covers franchise news and food trends.

Lindsay Friedman is a staff writer at

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