Sometimes you have to learn things the hard way, especially when you’re a so-called “social entrepreneur”. On the surface, social entrepreneurship is a laudable concept – the idea is that one can build a company or organization that solves a community problem while also being financially sustainable, and it seems like a win-win. After all, you’re making money and you’re helping people. You’re changing lives! No more donors will be throwing money away on useless projects! This is the future!
As I would come to learn firsthand, the issues surrounding social entrepreneurship are a lot more complex than they on the surface. As an aspiring social entrepreneur, if you’re not really careful about where you fall – more on the “social” side or more on the “entrepreneurship” side – you can have some serious issues.
Let me tell you a story that made me see things differently. Soon after starting my work in Africa, I sat for hours in a dusty Land Cruiser with my colleagues and a client as we sped down dirt roads in a remote part of rural Uganda. We drove past rolling hills covered in vibrant green trees, banana plantations, and cattle. Children stopped on the side of the road as we drove by and stared and shouted – after all, white people didn’t come by very often. Families of monkeys darted across the road in front of us, reminding me of the deer I saw growing up in Minnesota. We were the only car for several kilometers in any direction, and the journey was exhausting because of the poor conditions of the bumpy roads. The car was filling with dust, the sun beat down, and we were tired.
We had left Kampala earlier that day on a mission – to visit several remote rural sites where our client was constructing churches. The client had an ambitious program to construct hundreds of churches in rural East Africa, and they planned to provide water and energy services to support the community as part of their investment. We were their strategic partners who advised them on different kinds of technical solutions, and they partnered with local contractors to carry out much of the work. Their project was moving quickly; they had already met with government officials in most countries in the region, several of the churches were under construction, and funding had been secured from donors in Latin America. The project seemed to be moving fast compared to local norms, but we did our due diligence and independently confirmed that these activities were really going on. As a New Yorker frustrated by the slower pace of business on the continent, it was exciting to be on a project where things were finally moving!
After more driving, we arrived at our destination, a small remote village. We examined the worksite, where the foundation had already been poured and construction of the walls was ongoing. Great progress! We then met with the village leader who was incredibly happy to see us. Upon speaking with him, he told us about the local orphanage, where children who have lost one or both parents can get additional support, help with schoolwork, and other kinds of services. It seemed like a great opportunity for us to make an impact.
We went to the orphanage and met the kids. These children were extremely poor, even by local standards; they wore tattered clothes that were dirty and worn out, not like the new school uniforms at the fancy private schools in Kampala. Their English was poor and my attempts to communicate in my horribly broken Luganda didn’t go well either. Some of the children had hygiene problems, and there were several dozens of children with only a few staff. The whole situation was sad and overwhelming.
After we mingled with the staff and introduced ourselves, we were given the chance to address all the children at once, at which point one of the most infuriating moments of my entire professional life happened.
The client looked the children in the eye and told the crowd that I was going to bring them safe drinking water.
At the time, the idea was exciting. The kids cheered, clapped, and all started hugging me. I would later realize that he had made a promise on my behalf that I would fail to keep, and my overly-optimistic disposition became a liability.
Fast forward a few months later. Their construction work had been ongoing for a few months and the donors had all arrived to see the progress of the project. A large event was arranged at the national stadium to introduce the project to the world, and I was invited to be a VIP. Community members filled the stands as we took our respective seats under a canopy shading us from the brutal equatorial sun. I was wearing an Italian suit, sitting in a leather armchair in the middle of the stadium with the other VIPs. Officials surrounding me included the donors (who were wealthy entrepreneurs from Latin America), several local government officials, and a few Ministers. The local news media was present and was filming the event – they seemed to like using my face for their camera tests. The project was formally presented to the stakeholders, refreshments were served, and a crazy dance party broke out in that true Ugandan way that you can really only understand once you’ve spent time over there.
And then the mob showed up and demanded justice. No, seriously.
I learned later that our client had failed to pay about a hundred contractors in the region, so they decided to band together and fight for their money. They showed up en masse at the stadium and tried to force their way past the armed police guarding the place. The situation was tense – at first, our client unsuccessfully tried to calm them down, and then the police got involved…for the record, Ugandan police have no qualms about using force. It wasn’t clear what was happening at first, but once we realized something was wrong, we escaped through a side door, made our way to our car, and drove home before things got worse. It became clear that this project, despite our optimism, truly wasn’t going to work out after all.
I realized at that point that I had made a huge mistake: I spent too much time listening to people around me and “drinking the Kool-Aid”. When you’re a social entrepreneur, you are surrounded by people who are motivated by changing the world in different ways. SOme people volunteer, they go into politics, they start nonprofits, or they work in the private sector, but the vast majority of the ecosystem you build around you naturally consists of people whose main focus is on the social impact of their work. There are a lot of dreamers, not enough cynics, and too little institutional focus on core business concepts like lead qualification, unit economics, sales cycles, pipeline development, and cashflow management. I’ve always felt that the ecosystem surrounding social entrepreneurship is more accurately described as a nonprofit ecosystem dipping its toes into the world of business rather than the inverse, and my failure as a first-time entrepreneur to recognize my lack of experience in certain areas led me to be too excited about this project.
It also doesn’t help that everyone around you tells you that you’re awesome. I’ve attended formal dinners with heads of state and other government leaders where I was twenty years younger than everyone else, friends have introduced me at parties as ‘that guy who’s doing something amazing and changing the world’, and I could get an audience with just about anyone who was remotely interested in helping out poor or vulnerable people simply by introducing myself and sharing a little bit about my background. In terms of directional signals, it really seemed like things were going well and everyone was excited about my work. I was optimistic that everything would work out, and I wasn’t skeptical enough of what was happening in front of me. If I had been a bit more careful and spoken with more of the other partners involved in the project, maybe I would have realized that trouble was on the horizon.
But I didn’t. And I got chased out of a stadium by a mob.
It’s easy to get swept up in grand visions of changing the world, making an impact, and doing something about the problems you see around you. But until you really understand the core fundamentals of developing a company – all the way from the high-level, strategic vision down to the nuts and bolts of cash management, contract negotiations, and everything else – consider whether you’re doing more harm than good. Years later, I still think about those poor kids that never got water because I was too optimistic that things would work out and didn’t act quickly enough to prevent promises being made that I couldn’t keep.
Next time, I’ll be more careful.
This post is also available on Medium.