Social Enterprise World Forum tackles tricky subject of money

It's essential to the survival of social enterprises and vital in terms of the impact they can make but sometimes it can still feel like social ventures get a little antsy around the subject of money. On day two of the Social Enterprise World Forum in Milan, social enterpreneurs took the bull by the horns.

"Impact investment: realigning expectations" was one of the four main themes set out in the programme for the Social Enterprisew World Forum in Milan and the noise of conversation around this subject is getting louder. In the new quarterly print edition of Pioneers Post (available here), Nigel Kershaw of Big Issue Invest has expressed concern about impact investors. The spotlight on it at the forum confirms that it’s a hot topic in the social enterprise world.

With austerity still a concern (as demonstrated by the fragility of Greece currently) some see it as an inevitability.  In a debate titled "Lessons from Impact Investment: misalignment of expectations” Stefano Granata from Grupo Cooperativo CGM saw it very simply as a matter of pragmatism: “The citizen must be able to spend for these services as local government can no longer afford to.” The cooperative has taken investment in order to build more social housing in Italy.

Luciano Balbo of Oltre Ventures urged social enterprises to ensure their investors were in it for the right reasons. “If we think that impact investing is based on the intention of the investor and not on the result we create damage. As an investor I can tell you "I am a good guy" but this is not relevant. You have to ask me "What did you do?”

The debate came near the end of many rounds of talks and the crowd in the packed lecture hall was left somewhat sluggish by air conditioning that appeared to have given up in the face of trying to keep so many delegates cool. One of the concerns about impact investment is that it might become attractive to investors only interested in the bottom line. 

Nina Tellegen is the CEO of the Doen Foundation. An interesting battle of wills followed her explanation of the work DOEN does when Tellegen casually mentioned a “nice return” they had recently received. When asked by moderator Elena Casolari to be transparent about the figure Tellegen prevaricated for a while. 

To her credit, Casolari didn’t give up and Tellegen admitted to a return of “two or three million” for an initial outlay of a million euros. She added that this was a very exceptional situation since most exits give DOEN a return which is similar to or lower than the initial investment. This exceptional return might be cause for concern if that was going to an impact investor. However DOEN is a charity funded through Dutch lotteries, so that essentially means they’ve got more money to create more impact.

Which was pretty much the answer to an argument that surely needs no more discussion at these events. Still, there was one, entitled “The role of “for-profit” social enterprise in creating social impact”. Only those new to the social enterprise world might remain a little wary of the word ‘profit’ but as Harish Hande (pictured above), an admirably straight talking presence at the forum put it: “A person who is very poor who sells anything on the ground is a “for profit”. A street vendor is “for profit.”” The suggestion that “for profit” implies that someone is getting rich can be erroneous. 

Hande emphasised that his company, Telco India, concentrates on creating processes that are “socially, financially and environmentally sustainable for the poor”. They’ve made solar products available to people in India for $200, including the cost of the finance from the bank at 14%. 

This is still a lot of money for some people so they fit solutions to problems. In response to a street vendor telling them that their main priority was getting four hours of light a day, for which they were paying 15 rupees (about half a dollar), they found someone who already had solar panels that would charge batteries and then charge the street vendor 10 rupees for four hours use. The vendor pays less for their light, environmentally harmful kerosene is taken out of use and social progress is enacted.

Sure there’s profit happening here, but it’s of the kindest sort. As long as the right kind of ethics goes along with the business of money, impact investment and for profit social enterprises have valuable contributions to make.


The Social Enterprise World Forum (SEWF) was developed and first launched by CEIS – a leading authority in the social enterprise sector and the largest Third Sector business support provider in Scotland. This year the SEWF has been organised by ACRA-CCS and is taking place between the 1st and 3rd of July in Milan, Italy. To find out more, click here.

Photo credit: Telco India