Social Entrepreneurship in Europe: Pioneering, stalling, and hugely promising

Submitted by: Tsega Belachew on 01/27/14

Editor's note: This post was written by Felix Oldenburg (@foldenburg) Ashoka Director Europe and Germany.

Every once in a long while, a policy process delivers quick and ambitious results. For a short while.  

The recent EU policies around social entrepreneurship may not have made many headlines but triggered a profound change. They may even end up rerouting billions of dollars in funding to social innovations. Here is how that will happen.

Four years ago, I sat in the first exploratory workshop hosted by BEPA, European Commission President Barroso’s internal think tank, with a small number of mostly British experts. The ideas born there ended up in a highly ambitious Social Business Initiative only eighteen months later. It was presented by not one or two but three European Commissioners, the equivalent of government ministers, leading the portfolios of employment, internal market, and innovation. This unusually broad alliance presented 22 actions, including many obvious ones and low hanging fruits like awareness raising or mapping initiatives. 

There was real meat, though, in a new actions aiming at a social finance ecosystem. However, the best of them, the creation of a €86m social investment package, seems stalled between competing ideas about how to best enable every social entrepreneur in Europe to access it. Are social entrepreneurs better off as investees in venture capital models (European Investment Fund and others), or as hybrid organisations bridging philanthropy and investments (Ashoka and others)? To return or (partly) not to return, that is the question. The debate may be decided by players like the Financing Agency for Social Entrepreneurship (FASE) that take into account the much more hybrid structures of the large, continental economies, rather than copying UK approaches. 

Another two years later, we met again a few days ago in Strasbourg, at the beginning of a European year of elections, and witnessed how far social entrepreneurship has come in record time. 1,800 social entrepreneurs, policy makers and investors from all across the EU now form a veritable community. And as with any policy field after a few years, there are no longer only a handful of influencers behind the scenes but a much slower high level expert group (this one called GECES, with its own travel policy) of 70+ experts in place. 

Remarkably, the meantime has seen national governments entering into something like a race for their own social entrepreneurship policies. Social innovation is increasingly seen as the next big thing in Eastern and Southern Europe, as an opportunity to leapfrog past the (expensive) social welfare systems of richer countries, and directly to a culture of citizens driving (and financing) change in their communities.

This is where the two least mentioned of the policy actions come into play. By making social innovation a priority funding area under the massive Structural and Social Funds, and by opening up public procurement, social entrepreneurs could apply for tens of billions of funding over the next seven years. In a final twist typical for Europe, though, that depends on local governments translating pioneer-spirited European guidelines into local calls and tenders. 

Europe will need many more of its citizens to become active changemakers. In theory, they should have more support than ever. In practice, changemakers will continue to meet barriers, and overcome them, as changemakers do. 

Image Credit: Europa.eu