Don’t believe the hype
In 1996, the then chairman of the US Federal Reserve Board, Alan Greenspan, famously coined the phrase ‘irrational exuberance’ to describe some of the behaviour he witnessed in the world’s stock markets. It is a phrase you may have seen again recently because of the current volatility in the financial sector. But is such behaviour exclusive to the money markets? Are parts of the social enterprise sector guilty of a bit of irrational exuberance?
I am a social entrepreneur and I help other social entrepreneurs to set up and run social enterprises. I’m an enthusiastic advocate of socially entrepreneurial solutions to many of the big issues we face today, but I find myself getting increasingly irritated by some of the more exuberant claims for what social enterprise can achieve.
Where I am coming from on this has a lot to do with personal experience. I worked for a fair trade cooperative for seven years, running a shop and cafe in Leeds. In 2001, we were runners-up in the enterprising solutions awards. By 2004, we were out of business, no longer able to compete in a market we had done so much to stimulate. Welcome to the harsh reality of social business.
We all know that social entrepreneurs can be great storytellers, but I think we are in danger of believing our own hype. Social entrepreneurs are inspiring, but they are not superheroes. Indeed, they are all the more inspiring for not being superheroes. However, a superhero story is much easier to tell, so that is what we tend to hear at conferences and in marketing material produced to justify the significant investment in social enterprise support programmes. Nice, positive stories, easily digested by politicians and policy wonks – but do such comic-strip portrayals inspire anyone else, or do they leave the rest of us mere mortals feeling powerless?
There is also a danger in focusing on the sector’s big-hitters. I love the Eden Project, Cafedirect and the like; I’m just bored of hearing about them. My clients are even more bored. In the last month alone, three clients – all from voluntary sector organisations making that painful cultural shift into charging for services – have asked me for examples that might inspire them. Each time I struggled. I could either give them the same old stories, or more complicated ones from my own experience of people like them struggling to adapt to that pick-and-mix world of income generation, grants, donations, service level agreements and contracts.
I am aware that in writing this I’m setting myself up as the sector cynic, but I assure you that is far from the truth. I am massively enthusiastic about social enterprise and social entrepreneurship; I just believe that the reality of social enterprise in 2008 is a little more complex than the picture that tends to be painted.
Away from the glamour at the top end of the market, there are loads of organisations that are working hard at changing internal cultures, working with customers to encourage them to pay for services, and battling with the public sector to get it to match its new-found enthusiasm for social enterprise with an acceptance that someone somewhere still has to pay for social benefits to be delivered. And many of these hardworking organisations, like me, are starting to get a bit distracted by some of the more exuberant cheerleading on the touchline.