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THE RISE AND IMPLICATIONS OF SOCIAL
ENTERPRISE IN THE DTESContextualizing the Social Economy Within the
Political Discourse of Gentrification
Wes Regan
January 2015, Presented to Groundswell
SOCIAL INNOVATION
A RESPONSE TO WICKED PROBLEMS?
Wicked Problems (Planning/Sociology Term)
Problems that are extremely complex, sometimes hard to
understand the causes of, most often extremely difficult to solve
Karl Marx (socialist revolution) aside…
Can be created by or made worse through
Lack of political will or ideologically based policy creation
Competing interests
Market Failures (Vancouver housing…)
Loss of an industry or economic shock/restructuring
Public health crisis (disease, aging etc.)
Natural disaster, war, famine
Time
SOCIAL INNOVATION
What can be done NOW?
Finding unique solutions to social problems or social needs where government (public sector) or the market (private sector) has failed to
Often requires a non-profit or for-profit venture of some kind that can bring together elements of public and/or private sector, formal/informal/social economy to take a different approach
BUT can also take place within government or a single NGO or business
Examples…
INSITE – A SOCIAL INNOVATION RESPONSE TO
A PUBLIC HEALTH CRISIS
1998 A Public Health Emergency is declared in Vancouver’s
DTES as growth in intravenous drug use (Heroin) contributes
to a steady increase in HIV/AIDS, HepC and overdoses
SO WHAT IS A SOCIAL ENTERPRISE?
Definition is ambiguous but generally understood to be:
A business that operates to further a social mission or generates revenue for a non-profit or charity that does.
Social Economy (Non-profits, Civil Society, Community Orgs) 3rd Sector (UK) / CED (USA/Canada)
Modern Social Enterprise/Social Entrepreneur identified in early to mid 1990s by Leadbeatter (1997) Rise of the Social Entrepreneur. Though various kinds of entrepreneurial charities have existed for hundreds of years…
In BC – Enterprising Non-Profits (1997) and later the BC Partners for Social Impact (2012)
New Context – Neoliberal government and the turn away from the Welfare State model, de-funding of social safety net that society had relied on post WW2
FINANCIAL CONSIDERATIONS
Blended ROI
Social ROI
Patient Capital (longer timeframe for profitability)
Absorption of additional costs (33% Est. Shahmash,
2010)
Tax credits? (ENP, Buy Social)
Social Impact Bonds?
Community Bonds?
Emerging Procurement Policies?
SKILL DEV/WOMEN’S HEALTH/ECONOMIC JUSTICE
BASED SOCIAL ENTERPRISE
East Van Roasters
Common Thread Sewing
Cooperative
SOME “MATURE” DTES SOCIAL ENTERPRISES
United We Can (1995) SOLEfood
EMBERS (2001) Weatherization
Start a Business (SAB)
Grow a Business (GAB)
Atira (2002) Enterprising Women Making Art
APMI
Potluck Café and Catering (2003) 300,000 + community meals served
Corporate team building (Telus, Shaw etc.)
Recipes For Success
PHS launched several between 2007 and 2012 Bugs Be Gone
Our Community Security
Radio Station Café
The Window
Community
EastVan Roasters
Blue Shell Laundry (acquired)
WHAT IS NOT A SOCIAL ENTERPRISE?
A coffee shop that has a pay what you can or pay it
forward coffee?
A business that donates some of its profits to local
non-profits and charities?
A business that has a low-income person who does
the dishes or odd jobs?
A business that supports a non-profit or charity
outside of its community or country?
A business that supports a charity for something
that benefits wealthier people? (Equestrian Club?
Yacht Club?)
TYPOLOGIES AND AMBIGUITY
Social Venture
Social Purpose Business
Social Impact Business
Social Enterprise
Enterprising Non-profit
Community Interest Company (Nova Scotia)
Community Interest Corporation (UK)
Community Contribution Company (BC – 3C)
Benefit Corporation (B-Corp)
Etc. etc.
WHAT ABOUT THE SOCIAL SAFETY NET?
Is it a good thing that Social Enterprise, Social
Purpose Business etc is “booming” in the DTES?
Or is this just further proof that we need to demand
accountability and proper levels of investment into
the social safety net from Government?
WHY DO WE DO THIS?
YET HERE WE ARE….
Social Enterprise has come to play an increasingly
important role in the economy of the DTES
Social Impact or Social Purpose Businesses have also
gained profile
Save on Meats, Olla Flowers, Recycling Alternative
Estimated to be roughly 60 Social Enterprise in the area
with over 300 in BC and Alberta (Hall, Markey, 2010)
and more than 220 in BC (Hall, 2009) this has likely
gone up since then.
The largest concentration of social enterprise and most
mature social economy network in Canada (Nicole Chaland
on DTES Social Enterprise)
Serving a range of needs for a range of people
WHAT WILL BE KEY MOVING
FORWARD?COMMUNICATING INTENTION AND
IMPACT
The need to be realistic about intended impact
The need to be transparent about actual impact
The need to adopt methodologies to measure
impact
Social Return on Investment or Blended ROI
Demonstrating Value
B Corp
3C
Report to the Community
Social Impact Assessment
CommunityWise (?)
Certification (?)
WHAT MAKES A GOOD SOCIAL ENTERPRISE?
SOME ANSWERS FROM OUR RESEARCH…
Clear Social Mission
Clear attachment to a legitimate well governed non-
profit or charity
Accountability and transparency in the community
Operations are part of the mission (not just about
raising money for a non-profit)
WHAT MAKES A BAD SOCIAL ENTERPRISE?
Some more answers from our interviews…
Is not financially feasible and takes money from the
non-profit or charity for operations
Goes bust because it thought it would have an
advantage thanks to being a social venture
Does not deliver on impact (SROI) or exaggerates
impact
FUNDING AND RESOURCES FOR STARTUPS
For-profit
3F (Friends, Family and Fools) Debt financing (loans, line of credit), equity raise (Eligible Business Corporation, issue shares to investors – tax creditable for EBC) Crowdfunding (Indiegogo, Kickstarter) Futurpreneur, Small Business BC, Angel Investor (the Unicorns of the investment world) LUSH FUNd
Non-profit
Foundations - Vancity Community Foundation, Vancouver Foundation, the Real Estate Foundation, Mconnell Foundation, Central City Foundation, Tides Foundation, Ashoka, Lush
Government Granting Agencies – Provincial (Proceeds of Crime, BC Gaming) City of Vancouver (Direct Social Services Grants, DTES Capital Grants, Social Innovation Fund,
Greenest City) Federal Government – Arts Council, IRAP (technology)
THE PIPELINE
(OR ECOSYSTEM OR SOMETHING….)
Groundswell
RADIUS, ISIS (UBC), THNK
Futurepreneur
Ashoka (BC Ideas)
DTES Community Investment Fund (BOB)
Community Futures (Regional ED in BC)
Small Business BC
WESBC
IRAP
Tides
Vancity
DevCo (BC Co-op Association)
Foundations/Government Grants
BDC/investors (scaling up)
SOME FOOD FOR THOUGHT FOR STARTUPS
RISK, FAILURE AND LEARNING
Part of entrepreneurship is assuming risk
It’s ok to be a little bit scared or intimidated, this is totally natural, but the more you validate your assumptions (or prove them wrong and pivot) the more confidence you will gain
Don’t let fear of failing stop you from starting
But if you do fail, embrace it fully as a learning opportunity
For social entrepreneurs you are taking on additional challenges as running a “regular” business is hard enough as it is!
That being said…BE ACCOUNTABLE. What you are doing will affect people. Be responsible.
CONCLUSION
BE PRESENT AND EMBRACE THE PROCESS,
BE CURIOUS, BE HONEST, BE HUNGRY
Good luck social entrepreneurs!
https://www.linkedin.com/in/wesleyregan
BIBLIOGRAPHY
Issues In Social Enterprise and Social Entrepreneurship, Bielefeld, Wolfgang (2009) Journal of Public Affairs Education, Vol. 15, No. 1, 69-86
Crainer, Stuart (2012), Social Enterprise: The Quiet Revolution, Business Strategy Review, Issue 4, 14-21
Cooney, K (2011), An Exploratory Study of Social Purpose Business Models in the United States, Nonprofit and Voluntary Sector Quarterly, Volume 40
Issue 1, 185 – 196
Dart, Raymond (2004), The Legitimacy of Social Enterprise, Nonprofit Management & Leadership, vol. 14, no. 4
LePage, David (2011), The Progression of the Puzzle, Social Enterprise in British Columbia, Canadian Community Economic Development Network
Nicholls, A. (2010). The legitimacy of social entrepreneurship: Reflexive isomorphism in a pre-paradigmatic field. Entrepreneurship Theory & Practice, 34, 611-633. (Topic 1)
Peter R. Elson and Peter V. Hall (2013) Plowing the Fields: Provincial surveys of social enterprises in Canada, 4th EMES International Research Conference on Social Enterprise, Liege, 2013
Markey, Sean Patrick (2011), Social enterprise legal structure: options and prospects for a ‘made in Canada’ solution, Simon Fraser University
Inspiring Innovation: The Size, Scope and Socioeconomic Impact of Nonprofit Social Enterprise in Ontario. Canadian Community Economic Development Network (CEDNet)
Leadbeater, Charles (1997) The Rise of the Social Entrepreneur, Demos
BIBLIOGRAPHY
Myers, Jan, and MacDonald, Martha (2014), Reciprocal relationships: the role of government and the social economy in the construction of social policy in Atlantic Canada, Canadian Public Policy 40, 17-25
O’Connor, Pauline, (2014) The new regulatory regime for social enterprise in Canada: potential impacts on nonprofit growth and sustainability, Presented to the AFP Foundation for Philanthropy Canada, April 15th 2014
Perotin, V. The voluntary sector, job creation and social policy: Illusions and opportunities. International Labour Review Vol 140 (2001), No. 3: 327-362 (Topic 1)
Social Enterprise 2.0 Moving Towards a Sustainable Model, Jim Schorr, Stanford Social Innovation Review, Summer 2006
Simple Measures for Social Enterprise, Brian Trelstad, Innovations, Summer 2008, MIT Press
Teasdale, S., Lyon, F. & Baldock, R. (2013). A methodological critique of the social enterprise growth myth. Journal of Social Entrepreneurship, 4. (Topic 3)
Teasdale, S. (2012). What’s in a name? Making sense of social enterprise discourses. Public Policy and Administration, 27, 99-119. (Topic 1)
WEB SOURCES
http://www.sauder.ubc.ca/Faculty/Research_Centres/Centre_for_Social_Innovation_and_Impact_Investing/Resources/~/media/6196C5D2961E4665BC3639F3266CF6A5.ashx
Community Interest Companies (known as C.I.C.’s) are one of the fastest growing community oriented enterprise movements in the country. Roughly 1 in every 200 new companies last year was aCIC, and as of Mar 2014 there are almost 9000 CICs on the Regulators register…The CIC legislation was introduced as a legal form under the Companies Act 2006 and subject to that Act and company law generally” Community Interest Companies Association accessed June 3, 2014 at http://www.cicassociation.org.uk/about/what-is-a-cic
“The question of whether a simple non-profit (i.e. without charitable status) can own a C3 is more nebulous. Non-profit ownership of a C3 may signal profit intent, which could jeopardize the income tax exemption of the non-profit itself. CRA will provide opinions on a case-by-case basis.” Accessed July 12th at http://www.centreforsocialenterprise.com/C3_BC.html
Feeding Vancouver's poor a foundation for business: For Save On Meats owner Mark Brand, launching a charitable foundation could be the key to making his social enterprise profitable, Business In Vancouver, Dec 11, 2012 accessed June 3, 2014 at http://www.biv.com/article/20121211/BIV0106/312119944/feeding-vancouvers-poor-a-foundation-for-business
Is Save On Meats’ token gesture to the poor still a money maker for gentrifier Mark Brand? Carnegie Community Action Project accessed June 3, 2014 athttp://ccapvancouver.wordpress.com/2012/12/07/saveon/
Simon Fraser University Adjunct Professor and lawyer Tony Wilson describes the area in the Globe and Mail as: “It’s world-renowned for having the poorest postal code in Canada. The landscape is replete with boarded-up buildings, squalour, poverty, intravenous drug users, sex trade workers, crackheads, meth, cocaine and heroin addicts, and the homeless, not to mention crime. It’s an urban slum and many businesses gave up on the neighbourhood decades ago.” The Globe and Mail, February 26th 2013
Former police officer Leo Knight describes the DTES as “…a neighbourhood that plays host to the world’s largest open-air drug bazaar” Money Wasted on Vancouver’s DTES, 24 Hours Vancouver, Tuesday July 1st 2014 accessed July 3rd at http://vancouver.24hrs.ca/2014/07/01/money-wasted-on-vancouvers-dtes
Wendy Pedersen was one of a handful of instrumental people who were recognized at the Potluck Café and Catering Ten Year Celebration: “Please join us for a lively celebration and silent auction in the historic District 319 theatre. Ticket price includes tapas by Potluck Catering and one complimentary wine/beer.Our event will also feature awards honouring the following: Potluck Pioneers: Ken Lyotier, Wendy Pedersen, Elizabeth Lougheed Green & Scott Fitzsimmons” Accessed July 2nd at http://www.ticketweb.ca/t3/sale/SaleEventDetail?dispatch=loadSelectionData&eventId=3894945
Pidgin protests in Downtown Eastside concern activist funder, Frances Bula, The Globe and Mail, April 29th 2013 accessed July 3rd at http://www.theglobeandmail.com/news/british-columbia/pidgin-protests-in-downtown-eastside-concern-activist-funders/article11623767/
Pidgin owner defends controversial new Vancouver restaurant, CBC News, Feb 18th 2013 accessed July 3rd at
http://www.cbc.ca/news/canada/british-columbia/pidgin-owner-defends-controversial-new-vancouver-restaurant-
1.1411431
Downtown Eastside eatery is a bold entrepreneurial move, Tony Wilson, The Globe and Mail, Tuesday February 26th
2013
Anti-gentrification strategies in the Downtown Eastside get as much attention as the actual gentrification, State of
Vancouver, accessed July 3rd 2014 at http://www.francesbula.com/uncategorized/anti-gentrification-strategies-in-the-
downtown-eastside-get-as-much-attention-as-the-actual-gentrification/
Carnegie Community Action Project, a social justice advocacy and activism organization in Vancouver’s DTES, has been
resolutely critical of for profit social entrepreneurs like Mark Brand. His business Save On Meats was targeted by anti-
gentrification activists who stole his sandwich board in an act of righteous indignation.
Save On Meats hit by vandals; owner suspects anti-gentrification “anarchists” The Vancouver Sun, August 26th 2013
accessed June 3, 2014 at
http://www.vancouversun.com/life/Save+Meats+vandals+owner+suspects+anti+gentrification+anarchists/8129222/story.
html
“ Mark Brand, one of Vancouver’s most recognized social entrepreneurs, will discuss the challenges and victories of
operating businesses in Vancouver’s Downtown East Side. Having successfully opened seven businesses in the DTES,
Mark will share stories and answer questions about integrating diverse communities and finding unconventional solutions
to social issues. It is through his philanthropic efforts that Mark has found a unique balance, proving that you can be
successful in business while serving the greater needs of your community.” VancityBuzz, March 12th 2014 Accessed
June 3, 2014 at http://www.vancitybuzz.com/events/mark-brand-serial-entrepreneur/
Young Entrepreneur works to help a community to help itself with revitalization of Save-On-Meats, Vancity Credit Union,
Stories of Impact accessed June 3, 2014 at
https://www.vancity.com/AboutVancity/InvestingInCommunities/StoriesOfImpact/Realestate/Saveonmeats/