Out of all the things people say have the ability to change
the world, the social business holds real possibility.
Created and designed to address a social problem
A non-loss, non-dividend company, i.e.
It is financially self-sustainable and
Profits realized by the business are reinvested in the business with the aim of increasing the impact of the problem the company is addressing and subsidizing the social mission.
Unlike a profit-maximizing business, the prime aim of a social business is not to maximize profits (although generating profits is desired). Furthermore, business owners are not receiving any dividend out of the business profits. Unlike a non-profit, a social business is not dependent on donations or on private or public grants to survive and to operate, because, as any other business, it is self-sustainable. Furthermore, unlike a non-profit, where funds are spent only once on the field, funds in a social business are invested to increase and improve the business' operations on the field on an indefinite basis.
Per Yunus' quote: "A charity dollar has only one life;
a social business dollar can be invested over and over again."
So, the social business model takes it's cue from the traditional business model, but quickly turns it upside-down. While profit is important to a social business, the use of profits has far greater impact than that of the traditional model, as the profits become about the people the business serves and the social problem it's trying to solve. It becomes about something more than a bottom-line.
A social business is about much more than "teaching someone to fish". This is a structure that actually gathers people together with a common desire to see something of worth and purpose accomplished. This common desire then builds a community that impacts the community around them.