The document discusses the concept and significance of social entrepreneurship in transforming nonprofit practices within today's economy and culture. It highlights examples of Ashoka fellows who implement innovative solutions to systemic problems, particularly within the health sector, and emphasizes the need for collaborative business models to meet underserved market needs. Additionally, it outlines the framework for creating hybrid value chains that leverage the strengths of both social entrepreneurs and for-profit businesses to produce scalable, impactful changes.

1. Social Entrepreneurship and Its Importance for
Successful Nonprofit Practices in Today’s Economy
and Culture
Valeria Budinich
Vice President, Full Economic Citizenship
Ashoka: Innovators for the Public
Novartis Pharmaceuticals Corporation
The Power of Partnering Roundtable
Social Enterprise: Affecting Societal Change
Through Innovation and Entrepreneurship
November 9, 2010

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Contents
•What is Social Entrepreneurship
• Different models for scaling social impact
•The Power of Social Entrepreneurs
• Drawing Examples and learning from
Ashoka Fellows
•Hybrid Value Chains
• Opportunities for businesses to
transform sectors
• Criteria and Impact
• Healthpoint Services example
• New Opportunities for HVCs

3. 3
The Power of a Social Entrepreneur
As some differentiate between an entrepreneur and a successful
business manager, we differentiate between social entrepreneurs and
social service providers.
A social entrepreneur is someone who sees a problem and finds a
system-changing solution to the problem. She does not focus on
treating the symptom, but chooses to change the system that caused
the problem in the first place.
Many social entrepreneurs are also service providers but they do it
in a context where they are also focused on advocacy and/or
creating a new and more efficient eco-system or “industry.”

4. 4
The History of Ashoka
Ashoka is the leader in finding and electing leading social entrepreneurs
over 70 countries around the world. Ashoka elects between 150 and 200
social entrepreneurs working in a wide variety of sectors. We call this our
‘Venture’ process.
5 years ago, Ashoka realized not only is support of the individual important,
catalyzing collaborative entrepreneurship is also necessary. We have
launched a series of Global Initiatives to enable this new type of
entrepreneurship.
Ashoka then understood that creating an environment conducive for social
entrepreneurship and Everyone a Changemakers. We launched global
initiatives focused on fostering this environment through:
• Online competitions to source global innovations;
• Supporting entrepreneurialism at the youth level; and
• Creating changemaker campuses across the US; among others

5. Differing Models for Scaling Social Impact
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Scaling through policy and advocacy as well as partially or
fully subsidized service delivery – a non-profit approach
Scaling through revenues and for-profit business models – a
social enterprise approach
Scaling through influencing mainstream business and citizen
sector organizations– a hybrid value chain approach
+
A combination of these models or approaches

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7. The Ashoka Fellowship and Health
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Ashoka has over 3,000 Fellows in its global network of
leading social entrepreneurs, all of whom are working at
the system-change level.
Over 400 of these Fellows are working on health-related
issues in countries across the world. 179 have been
elected in the last 10 years.

8. 8
Health Fellows Regional Distribution
The health sector is
constantly addressed
in our Fellows’ work
around the globe.
Ashoka consistently
elects Fellows each
year in this sector.

9. Health Fellows Distribution by Focus
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By understanding the challenges
Fellows address and the
innovations they use, Ashoka can
better identify trends and
opportunities in the health sector.

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Sanjeev Arora (US):
•New Idea: Increased training from specialists to primary
care providers in rural areas of the US through telemedicine
reduces disparities in US for patients with chronic diseases
that do not have direct access to healthcare specialists
through telemedicine.
•Approach: Co-management of patients by primary care
physicians and specialists allows community providers to learn
how to treat complex conditions using video conferencing,
data collection, and “teleclinics.”
•Impact: Model has spread to multiple states in the US and is
preparing for international expansion; community providers
have increased ability to treat and quality of care.
Ashoka Health Fellows with System
Changing Ideas

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Ashoka Health Fellows with System
Changing Ideas
Vera Cordeiro (Brazil):
•New idea: Providing patient families with the support they need in
order to create the best environment for discharged children from
hospitals, Vera’s organization, Renascer, allows children who are either
convalescing from an acute illness or have a terminal illness but are
receiving outpatient care to break the cycle of recurring illness in their
lives.
•Approach: By using a family-led poverty reduction program, the most
critical problem the family has is identified, and through a process of
mutual understanding and exchange of services between the families and
Renascer, the problem is attacked.
•Impact: Reduced the re-admittance rate of sick children to the public
hospital by 60% and spread model to 23 hospitals in 6 states reaching
over 23,000 people through a family-led poverty reduction program.

12. Learning from Fellow Innovation
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Through the innovative work of these social innovators, the citizen sector has
learned that the power of a social entrepreneur can change a system in ways that
may otherwise not be possible through traditional means.
Within 10 years of being elected:
•48% of Fellows change the market dynamics and value chains of the system
•51% affect public policy and industry norms
•72% create business social congruence
•53% bring full citizenship and empathetic ethics to the systems they work in
•44% bring about a culture of changemaking and social entrepreneurship
Despite the successes of social innovators, the gap between the needs of society
and the current solutions available to address them are daunting. Ashoka believes
the models to address this gap are collaborative business models.

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“Working together, corporations
and social entrepreneurs
can reshape industries and
solve the world’s toughest problems.”

14. The Low Income Healthcare Market
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The current size of the low-income consumer market in health care is
estimated to be $202 billion.*
•In most countries, pharmaceuticals account for more than half of all
low-income spending – self-medication is often the first response to
illness in low-income markets.
•In Asia, the rural low-income market is expected to be 2.4 times the
size of the urban market.
•In Africa, urban and rural low-income markets are comparable in size.
New market-based models to address the demand and needs of these
markets are needed. Without them, billions of people are not served.
* Drayton, Budinich; Harvard Business Review, A New Alliance for Global Change.
September 2010. Based on The Next 4 Billion research by WRI (2005).

15. A New Alliance for Global Change
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The time is ripe for collaboration between for-profit
businesses and mission-driven individuals and organizations.
Hybrid Value Chains
•Businesses offer scale, experience in large market-based
operations and financing.
•Social Entrepreneurs a deep understanding of communities
they work with, low cost infrastructure at the grassroots
level, and strong social networks.

16. Hybrid Value Chains
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Businesses that enter into HVCs can expect three kinds of
Return on Investment
• Profits – new, untapped markets
• Knowledge – gained from local partners
• Talent – ability to enter new market segments and
geographies

17. The Healthpoint Services Model (video)
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Healthpoint Services, Inc.
Healthpoint Services is a for-profit social enterprise operating in rural Punjab,
India. The company was incubated out of Ashoka’s Healthcare for All initiative.
After one year, Healthpoint
Services:
•Operates 6 healthpoint units
•Treated over 14,000 patients
•Provides safe drinking water to
11,000 people daily
•Initiated plans to pilot in rural
Philippines in 2011
In India over the long-term, the company expects to
•Be working in 10 states
•Operating 10,000 units
•Generating $500 million in revenue per year.
Globally, potential gross revenues from an additional
4 countries are roughly 3x that of revenues in India.
Over the next 5 years, Healthpoint
Services will:
•Work in 4 states in India
•Operate over 4,000 healthpoint
units in India
•Generate revenues of $180 million
per year.

19. Hybrid Value Chains in Health
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Three types of opportunities are particularly ripe for HVC
models:
• When the citizen sector is large and growing fast
• There is a plethora of citizen sector organizations working to address the
health needs of local communities all around the world
• When market values are changing dramatically
• As whole-systems models are used to improve healthcare globally, new
opportunities for innovation and partnership are created
•When charitable funding and “free services” can be replaced
with genuine markets
• As sustainable health solutions becomes more of a requirement, cost-
based models are gaining increasing acceptance

20. Four Hybrid Value Chain Criteria
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1.A product/service that consumers are willing to pay
2.Large scale market potential (eg, multi-billion opportunities)
3.Corporations and social entrepreneurs willing and able to work
as strategic partners
4.A system-change business model with the capacity to create
new opportunities for entry and competition

21. Constructing Successful HVCs
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Ashoka has incubated a mission-driven social enterprise, Healthpoint Services.
It is part of a larger HVC model to transform the rural health sector and an
example of how to construct a successful HVC:
• Ask hard questions about how the business is currently done
• Charity-based health products without a clear distribution model, often addressing symptoms rather
than the cause
• Reconceive value along multiple dimensions to find new markets
• Bringing healthcare services to rural areas, decreasing cost and time of travel incurred by consumer,
creates access to new markets
• Look for pricing and financing innovations
• Combining healthcare services, products, and clean water to create a hub for rural healthcare increases
efficiency of business and economies of scale
• Organize to innovate
• Leveraging non-profit, local actors and creating a management team of deep expertise create ability for
model to evolve
• Give the team time and permission to fail
• Pilot phase allowed testing of different marketing schemes, technologies and additional services until
the right mix was found

22. Hybrid Value Chains and the Opportunity
for Sector Transformation
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The Healthpoint Services example demonstrates the power a social entrepeneur
combined with a new idea can have on a sector.
However, the social enterprise itself can not transform the rural health sector.
Healthpoint Services is a part of a broader HVC ecosystem, with players from
industry, government, the citizen sector and financial institutions. All are finding
value from forging these new HVC partnerships, enabling greater social value to
reach the underserved.
Ashoka has developed different HVC models in the Housing and Agriculture
sectors and is expecting new HVCs to emerge in the Energy, Water, and Finance
sectors.

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24. 1. In the pre-Roundtable survey, roughly half of the participants said that they have
(or would consider) social enterprise type projects. In your perspective, under
what conditions a social enterprise approach is more appropriate than a non-profit
one?
2. An increasing number of social entrepreneurs are collaborating with companies in
for-profit ventures as a mean to scale-up their impact and shape markets.
However, there is still considerable debate about commercial models mixing profits
and social impact. Where do you stand on this debate?
3. When building hybrid value chains, social and business entrepreneurs and their
teams need to develop new competencies, access new types of financing and
recruit the appropriate talent. What would be your advise to those who lead these
hybrid ventures? What are the risks and opportunities that they should focus on?
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DISCUSSION: SUGGESTED QUESTIONS TO COMMENTATORS

25. CONTACT INFORMATION
Valeria Budinich
Vice President, Full Economic Citizenship
Email: vbudinich@ashoka.org
Phone: 703-600-8313
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11/10 PBA-1028904