Who Says You Can’t Make Big Money as a Social Entrepreneur?

On the surface, social entrepreneurship often sounds like a good idea.

I mean, who wouldn’t want to come up with a solution to address something challenging such as racism, wealth inequality or climate change and have people pay you for it?

After all, using business as a force for good is what millennials, one of today’s largest demographic groups, say they want in a company.

But here’s the question I get from a lot of traditional entrepreneurs when encouraging them to start this kind of business: Can you actually make money from social entrepreneurship?

The answer is yes! That’s why I want to introduce you to the National Cooperative Bank’s recently released report, which shows that the top cooperatives in the country posted revenue totaling $255 billion in 2021.

Many of the top cooperatives are already household brands

The bank’s Co-op 100 report revealed the top 100 largest, most successful cooperatives in the United States. Some of the top companies listed were CHS Inc., Dairy Farmers of America, Land O’Lakes Inc., Ace Hardware Corporation and Navy Federal Credit Union. These five companies alone had a combined revenue of $90 billion and more than 50,000 jobs between them.

What’s interesting is that many of the cooperatives that appeared on the list are household names and are known throughout the world.

So what is a cooperative anyway? And do all successful social enterprises have to be structured this way?

A cooperative is a business owned and operated for the mutual benefit of its workers, who share the profits or benefits from their enterprise. Cooperatives are typically found in sectors such as agriculture, banking, health care, grocery, finance, energy and housing.

Millions of people are employed by cooperatives, which pay taxes and contribute to their local communities. They offer quality goods and services, take part in international commerce and deal with competition — just like any other business.

Cooperatives and publicly-traded firms often provide similar products and services, but they employ different business models. More importantly, co-ops are designed to benefit both their workers and the communities in which they operate.

Not all social enterprises are co-ops, however. Social enterprises use a range of business strategies to achieve their mission. In addition to co-ops, they come in many different forms, including benefit corporations, charities with trading subsidiaries and private companies limited by guarantee.

You can be successful with a social enterprise

Here’s the main reason I want more people to pay attention to this report: It helps to create awareness about the contributions of social entrepreneurs to the U.S. economy, and it shows other businesses that you can be successful with a social enterprise model.

The Co-op 100 report also serves as a reminder that businesses have an important role to play in creating a more equitable society.

Social enterprises are increasingly being used to address social issues such as poverty, racial inequity and environmental sustainability. For example, a number of social enterprises have been established to provide access to healthy food in underserved communities, create jobs for people from historically marginalized backgrounds and promote renewable energy sources.

These businesses can also be used to close the wealth gap in local communities by providing business owners from historically marginalized backgrounds with access to capital and resources.

By highlighting the success of these businesses, we can create a more just economy and help to ensure that everyone has access to the resources they need to thrive.

Businesses have a responsibility to do more than just make money

So maybe we need to start changing our definition of what a successful businessperson looks like. News flash: Elon Musk, Jeff Bezos and Warren Buffett are not the only ones out there (and notice they’re all white men).

Every business needs to make money.

But businesses also must be aware of the impact they have on their communities. Businesses also must recognize that they have a responsibility to use their resources to support social causes and fight against systemic racism.

Social enterprises are a great way to make that happen.

By investing more in these businesses, we can help to close the wealth gap and create more equitable economic opportunities for everyone.

There is no doubt that Musk, Bezos and Buffett all know how to build extremely successful businesses. But are they really committed to supporting social justice and ending systemic racism? I don’t think so.

How should we measure success?

So back to my original question: Can you really make a profit while doing social good?

Absolutely!

But instead of wondering about whether social entrepreneurship works, perhaps the bigger question we should be asking ourselves is this: Why are so many businesses still focused on making short-term profits at the expense of basic human rights and the communities they serve?

Isn’t the better goal to make money while doing good so that we can create more equitable economic opportunities for everyone?

With social entrepreneurship, all that is possible.