On one hand, they produce direct, measurable public benefits. A classic employment-focused social enterprise, for example, might serve at least four public aims:
- Fiscal responsibility — It reduces the myriad costs of public supports for people facing barriers, by providing a pathway to economic self-sufficiency for those it employs.
- Public safety — It makes the community in which it operates safer, by disrupting cycles of poverty, crime, incarceration, chemical dependency and homelessness.
- Economic opportunity — It improves our pool of human capital and creates jobs in communities in need of economic renewal.
- Social justice — It gives a chance to those most in need.
Yet, almost magically, social enterprises produce these benefits while reducing the draw on public and philanthropic funds. Their earned income streams supplant or replace grants and donations to produce a dramatically higher ROI. For example, a nonprofit that earns 50% of its budget through its social enterprise is effectively matching every dollar of “public income” with a dollar of “marketplace income”, doubling the social return on investment of those public dollars.
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