Is Social Entrepreneurship a Bad Fit for the US Economy? Harvard Business Review Says Maybe

In a recent Harvard Business Review Article, Timothy Ogden made the case that the U.S. is out of touch with Social Entrepreneurship.  His basic premise?  Social innovations created by the rich, intended on helping the poor, are bound to fail. 

Ogden, citing such lackluster American-borne social enterprises as One Laptop Per Child, says that there’s an “unrecognized truth of social entrepreneurship and innovation.  The United States isn’t a leader; it’s a laggard.”   The article begins and ends with the story of one of the most successful, at least in a public relations way, cases of social entrepreneurship:  William Kamkwamba, a Malawian youth who built a functional wind turbine from trash using a decades old textbook, for less money than the average American 8th grader’s allowance. The conclusion from this and other related stories of successful social ventures from the developing world for the developing world is that a true understanding of need can be better attained by those in the who deal with scarcity and need in a way that Americans couldn’t hope to understand.

Not to take away from the incredible rise in green business in the U.S. and elsewhere, the article nevertheless makes a fairly credible case for a shifting of roles in the U.S.  Instead of training entrepreneurs, Ogden argues, the U.S. and other wealthy nations should be focused on being Venture Capitalists for true social innovators in poor countries.  Despite years of training programs like SCORE and the SBA, rates of failure among entrepreneurs in the U.S. have remained steady.

It’s an interesting argument.  With U.S. money and advising, combined with developing world innovation, a powerful force for positive change could likely be achieved.

Scott Cooney is the author of Build a Green Small Business:  Profitable Ways to Become an Ecopreneur (McGraw-Hill), and Principal of GreenBusinessOwner.com, a green business incubator and membership website.

Scott Cooney, Principal of GreenBusinessOwner.com and author of Build a Green Small Business: Profitable Ways to Become an Ecopreneur (McGraw-Hill, November 2008), is also a serial ecopreneur who has started and grown several green businesses and consulted several other green startups. He co-founded the ReDirect Guide, a green business directory, in Salt Lake City, UT. He greened his home in Salt Lake City, including xeriscaping, an organic orchard, extra natural fiber insulation, a 1.8kW solar PV array, on-demand hot water, energy star appliances, and natural paints. He is a vegetarian, an avid cyclist, ultimate frisbee player, and surfer, and currently lives in the sunny Mission district of San Francisco. Scott is working on his second book, a look at microeconomics in the green sector.In June 2010, Scott launched GreenBusinessOwner.com, a sustainability consulting firm dedicated to providing solutions to common business problems by leveraging the power of the triple bottom line. Focused exclusively on small business, GBO's mission is to facilitate the creation and success of small, green businesses.