By Betty Hsu, Wharton MBA 2014; Co-Founder, ProfessorWord
Author Thomas Friedman once described social entrepreneurs as people who attempt to “combine a business school brain with a social worker’s heart.”[i] Substitute “educator” for “social worker” and that pretty much describes me – both in terms of why I decided to attend Wharton after years of working in urban education reform and why I decided to co-found an edtech start-up called ProfessorWord.
In talking to other social entrepreneurs, I’ve heard endlessly debated the question of how to balance the social vs. enterprise aspects of the venture. For example – do you focus on advancing your social mission or achieving financial success? If you favor the latter over the former, can you still call yourself a social entrepreneur or are you “selling out” in some way?
ProfessorWord was fortunate enough to be accepted into the 2013 GoodCompany Ventures program this summer, a 12-week accelerator that helps social entrepreneurs wrestle with these very issues, and we’ve learned a few important lessons:
- Achieving social impact and financial success can never be mutually exclusive. An un-scalable social enterprise won’t help many people, while a failed social enterprise will help no one. The primary goal of any social enterprise has to be on developing a business model that can bring about the desired social goals with a reasonable path to financial success. For a social enterprise to be successful, this can’t be an either/or question.
- Understand that short-term trade-offs may be needed, but your long-term vision remains. For many social enterprises, the key to success has been to launch in markets that offer less social impact but deeper pockets. This allows the venture to test the concept and to subsidize future service to the target market. While the social worker in you may balk at this, the business school brain will remind you that short-term trade-offs are often needed to achieve your long-term vision.
- Carefully consider your company’s status – for-profit, B corp, non-profit, etc. Social enterprises come in many forms. Selecting the right entity is a strategic decision that impacts your future development, financing strategy, and much more. Do your research before you decide.
It can be easy for an aspiring social entrepreneur to get caught up in how to create social value rather than profits, but doing so can be a great disservice to your venture. I’ve learned that my “educator’s heart” and passion for helping students learn vocabulary is necessary but not sufficient to launching a successful edtech start-up. It’s time that I give my “business school brain” a more prominent role, and I would strongly encourage other aspiring social entrepreneurs to do the same.
Bio: Betty has worked as a school district consultant, an education market researcher, and an English teacher. She holds a B.A. in Economics from Harvard College, an Ed.M. in Education Policy and Management from the Harvard Graduate School of Education, and is currently an M.B.A. student at the Wharton School of the University of Pennsylvania. ProfessorWord offers an easier and more effective way to learn vocabulary in context while you read online. Visit us at http://www.professorword.com/ to try our free tools and to follow our development.