The Innovation of a Hybrid Business Model for Social Enterprises

Noor Abu Jbara

Social entrepreneurship sheds light on emerging businesses that combine commercial and social values offered to markets and communities. In other words, social entrepreneurship looks for social gains rather than financial gains or profit shares. Leading businesses have said that entrepreneurs gain the maximum benefits from social enterprises, if they choose the right business model, structure and strategy for their enterprises.

Although there are two types of business models; traditional business models and sustainable business models, both are missing key commercial and social components. We’ll be sharing a new business model, known as hybrid linking traditional and sustainable business models (HSBM) to be used by social enterprises that have profitable, social and commercial objectives.

A Closer Look at Social Entrepreneurship

In general, social entrepreneurship is about performing an innovative activity that has a social impact in a commercial venture, or a corporate, or a not-for-profit organization (NPO), or a hybrid organization that has a mixed structure between non-profit and for-profit organizations.

On the other hand, a narrow definition of social entrepreneurship is about applying managerial and business practices in an NPO, in order to allow the organization to be innovative and to create new values. The aim here is to prioritize social value rather than personal gains and profits.

Social entrepreneurship is about having an entrepreneurial mind-set that is able to exploit a business opportunity and generate social value that satisfies community and market demand. Accordingly, social enterprises have many legal forms, whether they are a non-profit or for-profit organizations, as the most important features of them is having social driven structure, norms and values.

On the other hand, scholars have argued that the base of a business model is the ability to show how the business creates, delivers and captures the use and monetary values. Fundamentally, sustainable business models are those that help social enterprises illustrate how the business will create, deliver and capture its social value.