Social Entrepreneurship & Impact Investment (2235.YR.009206.1)

General information

Type:	OPT	Curs:	1	Period:	S semester
ECTS Credits:	3 ECTS

Teaching Staff:

Group	Teacher	Department	Language
Year 1	Alfred Vernis Domènech	Dirección General y Estrategia	ENG

None

None

In the first session I will introduce the concepts of social entrepreneurship and impact investing. After that the course is structured in two parts.

A first block will address the concept and practice of social entrepreneurship, and the three stages in the life of a social enterprise: start-up, scaling up, and growth/consolidation. Here we will also look at social entrepreneurship in different contexts, specifically in emerging countries.

A second block is dedicated to the sourcing and analyzing of impact investments. We will introduce the objective of generating social and/or environmental impact, how it is analyzed and measured, and how funders are increasingly investing for social and/or impact.

During the course, we will welcome guest speakers who will share with students their own experiences as social entrepreneurs, social consultants or impact investors; providing insights on possible career paths linked to this field, while offering an opportunity to engage with real cases and examples.

Students will be expected to do intensive preparation before each session individuallly and in groups, as well as to attend ALL classes, since a high proportion of the learning is developed in class. To prepare for each class, you should make use of the "study questions in preparation for class?, to encourage you to think through the main concepts, to prepare the class readings, and the exercise or the case for discussion.

Many additional articles, videos and links will be posted on Moodle (ESADE's elearning platform) so please check it regularly for updates. The slides used during the sessions will also be posted there. I will make active use of the news forum and the debate channel and other online tools on Moodle, so that we can make better use of our time in the classroom. All assignments will be handed in on Moodle and I will provide you with feedback as the course proceeds.

It is widely accepted that contemporary democratic societies are built around three sectors: public administrations, business companies and nonprofit organizations. Like a three-legged stool, these three sectors have to work together to drive societies towards a state of equilibrium. However, certain organizations seem to blur the limits between these sectors: Social Enterprises. In an ever-changing, fast-paced environment, social enterprise organizations (for profit and nonprofit) need the appropriate skills in order to face new challenges and continue to help improve the lives of people and communities. In other words, these organizations must be truly capable of leading the complex world of social intervention. The new demands placed upon social enterprises are the results of deep-rooted changes that are shaping contemporary societies.

Impact Investsments seek to generate social and/or environmental impact in addition to financial returns. This emerging investment strategy can be applied across all asset classes in diversified portfolios, while addressing critical issues such as energy, water scarcity, climate change, community development, access to financial services, health, sustainable development and education. Often times impact investors are the first investors in a Social Enterprise.

A new generation of investors and social entrepreneurs are recognizing that many challenges facing the world can only be solved through integrated solutions that can successfully combine business acumen, capital markets, and policy objectives.

Though social entrepreneurship and impact investing have gained in popularity and are now being taught in many universities, both concepts are still very young fields intellectually. The theory is in relatively elementary stages of development and empirical research has been limited. The concept is inherently appealing to many, but we do not have the kinds of intellectual frameworks that would help social entrepreneurs, their funders, and policymakers make wise decisions about how to use it to the greatest benefit. This analysis requires looking at limits and weaknesses of popular approaches to social entrepreneurship and impact investing with the same intensity as we trumpet their strengths.

The course is designed for a broad range of ESADE students including those who, during their professional careers, are considering a leadership position in a social enterprise; are interested in understanding the specifics of managing social enterprises; interested in advising social enterprises; planning to serve as board members or volunteers; funding or investing in social enterpriseS; or interested in leveraging business to serve social transformation. "Social? is understood here in the broadest sense of benefitting society, including environmental improvements.

The main goals of this course are to introduce and explore how social entrepreneurship can help find solutions to the major social challenges facing our society, and to foster a positive attitude and affinity toward the possibility of becoming personally involved in a social enterprise initiative in the future. We will also introduce and explore the concept of impact investing as a way of applying the principles and practices acquired in the course in any career path. Hence participants will acquire the basic knowledge necessary to source and analyze investments which help generate economic and social and/or environmental value simultaneously, and are economically viable in the long term.

The course also places a strong focus on methodologies and skills. We will practice creativity and innovation skills, analytical skills, negotiation skills, group work, presentations... and become acquainted with the main innovation and start up methodologies of the time, as well as with the investment strategies. We will also sharpen our critical thinking ability and strive to develop our own opinions about controversial issues and question our own assumptions. Hence this course is also interesting and suitable for students who want to explore entrepreneurship, investments, or simply an alternative view to business and economics.

The course strives to be eminently practical and applicable to a variety of contexts. For this reason we will analyze cases referring to different types of social enterprises and investments, in different sectors and continents, addressing varied challenges in various ways, and displaying the main challenges faced by social entrepreneurs and investors in different development phases.
At the end of the course, students should:
1. Be familiar with the basic principles and practices of social entrepreneurship
2. Understand how social entrepreneurs develop businesses that have a positive social impact, but are also financially viable.
3. Grasp the concept of social and environmental impact investment and how social entrepreneurship requires the appropriate type of funding.
4. Develop participant's analytical skills to spot and analyze investments in social enterprises.
5. Enhance a student's ability to weigh various qualitative and quantitative decision factors and exercise independent judgment when making investment decisions.

1. Session 1: Introduction to social entrepreneurship and the course In this session, we will get to know each other and set the basis for the course. We will start getting acquainted with the topic of social enterprise and build a shared understanding for how this course will run.

2. Session 2: Social Enterprise a Real Example In this session, first, we will try to understand with a real example how a Social Enterprise works. After several years of learning with Moltacte, we decided to write the case, and it has been a real challenge. We will discuss how a social enterprise starts. What elements and processes are involved in creating an idea and bringing it to life? Finally, we will try to understand all the stages of a social enterprise.

3. Session 3: Theory of Change and Measuring Social Impact It is fundamental to begin by setting the objectives of what the social enterprise is trying to achieve. In other words: understanding the social impact in a social enterprise may appear an intuitively simple task, but in practice, there is often confusion. In this session, we will debate the meaning of impact and how developing a theory of change is a fundamental first step in understanding how a social enterprise can achieve impact. In almost all methodologies, identifying and setting objectives begins with some aspect of the theory of change. A theory of change describes the change you want to make and the steps involved in making that change happen. It helps you visualize an organization's path from needs to activities to outcomes to impact.

4. Session 4: Recognizing Social Opportunities. Social Business Models and the Social Business Model Canvas Every social venture begins with the idea of improving society in some way. They represent a starting place but lack the finish to build an enterprise around. Entrepreneurs are often credited for their creativity and ability to generate new ideas for meeting customers' needs. But where and how do ideas for meeting needs originate for most entrepreneurs? This session will discuss opportunity recognition tools and social business models.

5. Session 5: Scaling Social Impact If we reviewed the social enterprises we studied, the majority are small and medium firms. What does it take to grow a social enterprise? Is it possible to develop a social enterprise without compromising or losing sight of the business's original social commitments and ethos? There are several experiences of replication of social enterprises through social franchising, social licensing, and collaboration. Perhaps the biggest pitfall social entrepreneurs may fall into as they try to grow their enterprise is broadening their focus and product lines when their success was to born focus. We will explore the role of technology in scaling social impact. Tech for social good uses digital technology to tackle some of the world's toughest challenges

6. Session 6: Financial Instruments for social enterprise Impact investors seek to generate environmental and social impacts in addition to financial returns. This emerging investment strategy is developing worldwide to expand the ability of social ventures to scale their impacts on critical issues such as energy, water, climate change, community development, health, sustainable development, and education. It includes venture capital, private equity, debt, and specific kinds of philanthropic investment tools. Social enterprises have traditionally had few sources of expansion capital to approach. Still, in the past few years, their options have been growing as the universe of impact investors and lenders has grown. In addition, new corporate structures, industry metrics, and financing platforms are being developed to bring transparency to the market and facilitate the flow of capital to social enterprises in a range of industries.

7. Session 7: Financing a social enterprise in practice Impact investors seek to generate environmental and social impacts in addition to financial returns. This emerging investment strategy is developing worldwide to expand the ability of social ventures to scale their impacts on critical issues such as energy, water, climate change, community development, health, sustainable development, and education. It includes venture capital, private equity, debt, and specific kinds of philanthropic investment tools. Social ventures have traditionally had few sources of expansion capital to approach. Still, their options have grown in the past few years as the universe of impact investors and lenders has grown. In addition, new corporate structures, industry metrics, and financing platforms are being developed to bring transparency to the market and facilitate the flow of capital to social enterprises in various industries.

8. Session 8: Impact Investment in practice "Investors are increasingly factoring in environmental, social, and governance (ESG) considerations because they can be financially material and useful in analysis and decision making. We expect the next wave of growth will be driven by investors actively seeking to identify and address sustainability challenges in areas ranging from climate to inequality to healthcare. In a recent survey, 62% of family offices indicated that impact investments will be a key focus."

9. Session 9: Final Presentations Each group has to pitch about their social enterprise

ASSESSMENT BREAKDOWN

Group	Teacher	Department
Year 1	Alfred Vernis Domènech	Dirección General y Estrategia