Social investment sector is amateurish

CHENNAI: Social entrepreneurship, an inclusive business model well suited to address the needs of the poor by combining social objective with efficiencies of private enterprise, will vanish by the next decade as it won’t be able to cope with the pressure from funding agencies and venture capitalists to generate quick returns, warn experts.Speaking at a plenary session of the Unconvention Forum, Laura A Parkin, chief executive officer of the National Entrepreneurship Network, said that 10 years from now, there won’t be any social enterprises and the entities who survive will become non-profit organisations.Interestingly, with the American and European markets hit by the economic meltdown, experts predict there that will be a huge demand in the emerging market. “But nobody know how to tap these markets,” says Laura.Harish Hande, managing director of SELCO Solar Private Limited said that the biggest problems with management schools is that they fail to understand the economics of the Indian population and try to implement Western models that result in failure.Ruing the fact that social entreprenuership has been monopolised by English speaking natives, he said that these investors are not in touch with reality and lack the thinking on how to develop the eco-system for the poor.Hitting out at MBA graduates, he said their focus is only on selling sustainable products but they fail to create sustainable infrastructure.Gavin McGillivray, head of the department of the new private sector department and Department for International Development (DFID), said social entrepreneurship is not fulfilling its potential as investors are not willing to invest. “Social investment sector is amateurish and professional investors need to understand there is a potential there,” he said.Meanwhile, some of the entrepreneurs blamed the investors for failure of some businesses. “A social enterprise can’t make profits immediately. As it reaches out to the poorest of poor, it will take time as the business is built brick-by-brick. But the investors pressure on enterprises to deliver the results soon, ends in the failure of the business,” an entrepreneur added.