Giving Compass' Take:

• Ryan Ross discusses the role of social enterprises in impact philanthropy and how they may be ahead of the curve in the new environment where consumers are holding companies to higher standards.

• What can we do to remove the stigma of investments that look for profit and try to perform a social good at the same time? How can we support social entrepreneurs with greater resources?

• Read about how social enterprises can attract growth-stage capital.

Social enterprises face a number of challenges, and perhaps one of the most daunting to overcome is the stigma around the concept of a “double-bottom line,” as a company purses both profit and impact. Simply put, investors are skeptical. At the Halcyon Incubator, we’ve worked with dozens of founders who have faced the same pushback around their mission. Many social entrepreneurs exist and compete in markets that are not solely impact-focused. Misfit Juicery is a perfect example of this. The majority of companies competing in the cold-pressed juice category are not impact-driven.

If we want to support the development of early-stage social enterprises, the driving question becomes: What is the competitive advantage of a founder calling their business a social enterprise? There are certainly a few answers to this question, but potential corporate partnerships are one of the most powerful, if underreported, ones.

Large corporations are facing a new reality. With significantly more transparency across the world, consumers are holding businesses accountable for the impact of their core operations. Nearly two-thirds of Americans believe that companies should take the lead in driving social and environmental change. This presents a challenge for some, but for other companies like Baldor Specialty Foods, this new era of transparency and accountability presents opportunity. Baldor is a major player in the food industry, and like many of its peers, it is now looking at how to best address the issue of food waste during its production process.

Read the full article about the competitive advantage of social enterprises by Ryan Ross at Stanford Social Innovation Review.