The increasing number of disillusioned people keen to quit corporate Australia is driving growth in Australian social entrepreneurship, according to the winner of a new social innovation grant.
The School for Social Entrepreneurs, a not-for-profit organisation that aims to develop community-focused businesses, landed the inaugural Macquarie Social Innovation Award for 2010.
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The organisation has been given a $100,000 grant as part of its prize, with six students selected to receive $10,000 each to develop their own social enterprises.
Benny Callaghan, CEO of the School for Social Entrepreneurs, says that the sector is now being taken seriously by investors and big business.
“It’s very early in the sector’s development, but a lot of larger firms now see social enterprise as an important area,” he says.
“There’s a growing number of people leaving corporate Australia to start up a social enterprise. We are seeing a big increase in applications to the School for Social Entrepreneurs and an increase in the funding given to businesses. We’re seeing a move away from philanthropic grants towards funding sustainable businesses.”
The School for Social Entrepreneurs, which beat six other organisations to secure the grant, was established in Australia two years ago after being founded in the UK. It runs nine-month courses for people with social entrepreneur ideas and early-stage start-ups.
Callaghan says that last year’s 65 graduates in Sydney and Melbourne generated $3.7 million in revenue between them during the course. Businesses range from indigenous recruitment providers to a home birthing service.
Julie White, head of the Macquarie Group Foundation, denies that $100,000 split seven ways was a meagre amount of funding for the victorious start-ups.
“It’s a significant award – $100,000 is a considerable amount,” she says. “We looked at what the school was doing and it made sense to seed grants to the graduates. My impression is that $10,000 will provide a good kick-start to these businesses.”
Asked about the future prospects of start-ups in the social entrepreneurship sector, White says: “Any business model has a certain amount of risk, but we are seeing that investors are looking at alternatives to provide them with a hand up rather than a hand out, as Noel Pearson would say.
“Social enterprises are becoming more sophisticated and more professional. As they provide the services that government has done in the past, they are also becoming more accountable. Government is now stepping away and realising that for the same investment, social enterprises can do the same work.
“There is absolutely an opportunity for entrepreneurs out there to succeed in this sector.”
The next Macquarie Social Innovation Award will take place in 2012.