#06 innovation
Michael Vollmann

Social Entrepreneurs – Bottom-up Innovators for Development

100 years ago, two major innovations were launched: In Detroit, Henry Ford began to revolutionize the automotive industry with modern assembly technology, while in Rome, Maria Montessori started the first modern kindergarten, the casa dei bambini, the first true educational institution for children beyond personal tutors for the wealthy. Both ideas have revolutionized their fields and set new standards.

Today, 50 million cars are produced annually, and the assembly line has multiplied productivity around the world. In that same time period, Montessori's insight that even small children need specialized education has spread well beyond the kindergartens that bear her name and spawned a whole field.

Without it, our entire system of early childhood education would hardly be conceivable. Henry Ford was an entrepreneur. Maria Montessori was a social entrepreneur. She pioneered a new social idea in the face of resistance, flouted convention and systematically worked to establish this new idea on the market, in our minds and in our cities. She was an educational pioneer, a toy inventor, the founder of an organization, a branding genius and an international activist.

Social entrepreneurs are individuals with innovative solutions to society's most pressing social problems. They are ambitious and persistent, tackle major social issues and offer new ideas for wide-scale change. They are the key source of many innovations that have conquered the world and changed whole systems. In India, Jeroo Billimoria started a toll-free hotline for street children run by street children. In ten years, this idea has spread to over 120 countries and similar hotlines are run by some governments today. She then launched a movement that empowers kids to take charge of their finances, spreading financial literacy to young people. A few weeks ago, she achieved her goal of reaching one million kids in 75 countries. Muhammad Yunus is surely the most famous social entrepreneur to reach a tipping point. He reintroduced Raiffeisen's idea of microcredit to international development all over the world.

International development can profit from social entrepreneurs in many ways

In the private sector entrepreneurs have been and continue to be the major force that drives innovation and development. This is exactly what thousands of social entrepreneurs do too in the social and public sector at a local level around the world.

Think of social entrepreneurs as local guides for spotting social problems untapped by the market or government - as a kind of radar for social change, impending shifts in their societies, changes in the marketplace, and new business models. Wherever new populations become empowered as full economic citizens, social entrepreneurs are the first to involve them since they are ideally rooted in local communities. Social entrepreneurs play a key role wherever a society is transforming and attaining a new level. They push the envelope of what is possible, start with a crazy idea and establish a new standard. For any development agency or business entrepreneur, getting closely involved with social entrepreneurs is like having a predictor of new markets, customers, and new ways to be part of historic transformations.

Think of social entrepreneurs as a decentralized R&A department with thousands of local branches and a huge portfolio of bottom-up solutions that has been tested and further developed in practical trial and error mode. These solutions are often ready to be shared and replicated to other sectors and locations, which keeps us from reinventing the wheel in the development sector. Few social entrepreneurs will go global like Jeroo has. But you will find them in the most remote corner of this planet and with them a perfectly adapted solution ready to be used in other contexts or places.

Finally, think of social entrepreneurs as local collaborators and partners who can be multipliers, ambassadors and powerful implementers for your programs and development strategies on very different levels. They impact communities by enabling them to identify their needs and hopes, develop self-sustainable solutions and mobilize the necessary resources. They empower a community to take on ownership, enhance capacity and thus secure dignity. At the same time, they act as regional and sometimes even national policy change agents fighting for their communities' rights.

How international development can foster social entrepreneurship

Henry Ford and Maria Montessori: both innovators who changed our world. Yet there is a key difference between them, quite apart from the question of social impact. It is the fact that business innovations are supported by the market, if only because there is a prospect of profit. In hindsight, every person who reads this would have loved to have been among the first investors in Henry Ford. An investment of in 1910 would be worth 3,678 today, a handsome profit. But what about Maria Montessori? Anyone who claims to care about children would probably like to have been among her first supporters given the tremendous change she created. Still she did not enjoy the same support as her counterpart in business, nor would she to this day.

What we need is a society in which social innovations enjoy better rather than worse conditions than business innovations. One in which the private sector offers whole ecosystems to entrepreneurs to support them in their daily work because it knows and understands their importance for development. One of the most perfect examples of just such an environment is in Silicon Valley. There universities generate plenty of highly skilled and motivated talent ready to "fail often and fail fast" in boot camps, innovation laboratories, co-working spaces and other innovation hubs that are closely linked to investors just waiting for new deals and ready to provide seed and growth funding. These are then reported to a highly specialized media that provides cutting edge information on each and every development in the arena. In this setting, failure is seen as THE most valuable learning experience.

This means that we as supporters should accelerate the success of social entrepreneurs on their terms and not on ours. Social entrepreneurs can not only demonstrate how to implement an idea. They can also show us how to use resources effectively. We need to trust them to do so and not keep them on a leash with highly restricted grants. Social entrepreneurs are entrepreneurs first. They need free, entrepreneurial forms of financing. They require advice and networks instead of restrictions. They must be captains of their ships if they are to find the smartest solution to a problem. We have huge resources to spend every year in the development sector. If we want to help social entrepreneurs to change the world, we do not want them as applicants, but as co-producers!

This requires a political agenda for social innovation,. We need smart support programs with customized start and growth financing for social entrepreneurs. We simply cannot afford to dynamically invest into business start-ups on the one hand while administering our spending on social challenges in bureaucratic, ineffective top-down programs on the other. We need new public procurement and funding regulations that reward and do not penalize the creative and entrepreneurial activities of social organizations. And finally, we need a large scale communication effort to encourage more people to form organizations to solve social problems and become changemakers themselves!

These past few months, we have experienced what feels like a vital moment in world history, with great tragedy, fast spreading change and a loss of faith in old, top-down, technological and autocratic paradigms. We feel the world closing in on us. And we realize that unless we can produce solutions faster than problems, we will not be sustainable as societies. We need a major acceleration, an abrupt change. This cannot occur with the size and scope of existing development organizations, nor by scaling up existing solutions. Instead we must find new, entrepreneurial spirits - the Maria Montessoris of our time, the bottom-up, local champions of social innovation, who will not rest, who will overcome all barriers, who will accept risk, guide us out of our comfort zone and step up to lead.

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