The Impact & Importance of Social Investment
Youth are becoming increasingly more aware and involved in the challenges facing society and the environment. To address these issues (and more) we explore the concept of “social investment” and its appeal to youth interested in entering this line of work. But what is social investment and how does it differ from other commercial endeavors?
In this episode of Anan, we learn from Lujain AlUbaid, a social entrepreneurship expert. She defines social enterprise as the exploitation of capital in profitable projects that also create sustainable impact, address a social challenge and benefit a large number of people.
What is Social Investment?
Since social enterprise generates profits and has an impact, those who classify a typical business endeavor under the heading of social enterprise may be confused. AlUbaid clarified the differences between them, noting that the projects that are not classified as social enterprises are those that have business models focused solely on generating profits, without taking the beneficiary into consideration when making managerial decisions.
AlUbaid gave the example of Uber, noting that although the company solves a mobility challenge in today’s society its business model is not beneficiary-focused, rather it is a profit-driven company.
On the other hand, AlUbaid presented “Lamsa”, a local brand that is a good example of a social enterprise. Lamsa, is an edutainment platform that provides Arabic content for children in line with the values of Arab societies. The company is working on developing content in cooperation with the best experts in the world and addresses a social challenge: there are very few values-based content options for kids in Arabic.
Social Investment and Vision 2030
Social entrepreneurship plays a major role in achieving the Kingdom’s Vision 2030, as AlUbaid indicated. One of the vision’s goals is for the non-profit sector to contribute to the gross domestic production by 5%, explaining that it currently contributes less than 1%.
AlUbaid stresses that it is only possible to increase this number and achieve the desired goal through concerted efforts between many entities. “Social enterprise can contribute to the progress of this goal because through it, capital can be raised and sustainable impact can be achieved. This makes it attractive for traditional philanthropists and investors alike, not just donors as in the case of charities and foundations,” she said.
Youth & social Enterprise
Many young people are eager to enter the field of social enterprise but they do not know where to start. Here, AlUbaid indicated that there are two paths for such youth; the first of which is to have enough capital to invest in social entrepreneurship projects and the second is for youth to build innovative and sustainable solutions to a particular social challenge.
AlUbaid emphasized that the magic recipe for success in this field lies in the youth being passionate about understanding a problem and solving it. She believes that youth should become obsessed with finding the solution to a particular social challenge and only then can they be effective social entrepreneurs.
In this discussion, Lujain AlUbaid also clarified that it is not necessary for all youth to be entrepreneurs or social investors to make an impact., stressing that it is possible for a person to work in a field such as education and leave lasting, sustainable impact through educating young people.