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A new Wharton class points to profit-making as the path to social progress.
Social entrepreneurship — starting companies that make money while solving social problems — typically gets short shrift at business schools. Sure, it's noble, but it just doesn't have the sex appeal of, say, introducing the iPod or launching a software company that might one day rival Microsoft.
A social venture's customers can be poor — say, farmers in developing countries — and its markets limited or unproven. For that reason, starting one may be even more vexing than the already daunting task of launching a typical company. "Social entrepreneurship is a helluva lot more difficult," says Prof. Ian MacMillan, director of the Sol C. Snider Entrepreneurial Research Center. "It requires more imagination. These are much tougher businesses."
That's partly why MacMillan, who teaches management, says his new class on social entrepreneurship, scheduled to start this spring, "isn't for wimps." The students not only have to come up with a business plan for a social venture, but they'll also tackle a hefty list of readings. And woe to the student who comes to class unprepared. "Mac will have no qualms about booting you out if you show up and haven't done the work," says Sarah Ryerson, a second-year MBA student who helped MacMillan organize the course.
"This class was designed as a living case study," explains Emily Cieri, managing director of Wharton Entrepreneurial Programs. "The students will work on live projects and develop business plans for those projects. The ultimate goal is for them to start the businesses after the class."
To that end, they'll study how to organize a social venture, raise money, recruit employees, measure social impact and, if their venture succeeds, scale up to large size. "The basic thesis [of the class] is that many social problems, if looked at through an entrepreneurial lens, create opportunity for someone to launch a business that generates profits by alleviating that social problem," MacMillan said in the proposal for the course. "This sets in motion a virtuous cycle — the entrepreneur is incented to generate more profits and, in so doing, the more profits made, the more the problem is alleviated."
Ryerson and a handful of other students had to prove their moxie to MacMillan before he'd even agree to teach the class. The students are members of the Wharton chapter of Net Impact, a student group that aims to use business to make the world a better place. Members of the club had first approached MacMillan about a social entrepreneurship class in the fall of 2003.
Initially, MacMillan brushed them off, saying they'd have to prove that enough students were interested to fill a class. And he challenged them to go out and do research on the curricula in similar courses at other schools.
The group persisted. They collected syllabi from comparable classes at eight other schools. They then gathered all of the readings listed on them, divided them up and evaluated them. That led to a proposed syllabus and reading list, which they presented to MacMillan, though he ended up creating his own.
The students and MacMillan then hammered out some of the details in a series of early morning meetings. "There were a lot of 8 am meetings," says Ellie Moss, another second-year who helped in the planning. "For the first meeting, we were there waiting for him when he arrived, and he was blown away. Then we had a 7 am meeting."
"I think he was surprised we jumped the hurdles he gave us to jump," Ryerson adds.
The real hurdle will present itself next spring, when the half semester course debuts.
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Sol C. Snider Entrepreneurial Research Center