Are social enterprises trying to push a boulder up a mountain?

Yesterday I spent some time reading a report (Social Innovation: What it is, why it matters and how it can be accelerated) from Nesta, which states “Pioneers who create markets through radical innovation are almost never the companies that go on to scale up and dominate them”

These days my mind is awash with thoughts of social enterprise scaling, how did they scale, why don’t they scale, will they scale - it’s on repeat! Reading the report I was suddenly really stuck on this sentence. Whilst the report is a little dated at this stage (it’s from 2010) much of it still rings true.

I have been really interested in the growing movement of Scale Ireland, who are building a cohesive start-up ecosystem at speed. For many startups, the path can be clear - pilot, get investment, scale, divest. Ok, I am fully aware, before I have start-up founders reading this shaking their head at me saying ‘if only’ - It might be clear but I know it isn’t easy. However - my simplification apart, for most social enterprises it is not quite so clear, there are just not very many finance options available for most social enterprises, which means getting the resources required to scale is a real challenge.

“Big companies are often better placed to take new ideas from niche markets to mass markets, and many have concluded that they should subcontract the creation of new and radical products to start-up firms.”

The above second quote from the same report, really crystallised one of the challenges a scaling social enterprise faces. It made me think, what if when a social enterprise got to the stage it was ready to scale, what it really needs is to merge with a better resourced social enterprise with the expertise and resources to bring the social impact to the next level. What would that process look like? As there is typically no equity involved in many social enterprises (most are CLGs) - do they simply hand over their work and move on? It’s an interesting proposal or maybe a crazy one, but one I think merits some serious thought.