Reports from the 2009 Social Capital Markets Conference

The 2009 Social Capital Markets conference (SoCap09) was a watershed event. There was a clear sense that social enterprise has become a viable business strategy and investment option.

The event brought together many of the familiar faces from social enterprise summits past, but also a new group of leaders from traditional industries such as investment banking, government, real estate and forest products.

In the opening keynote address, Sonal Shah, Director of the White House Office of Social Innovation and Civic Participation, was aglow with hope as she spoke of the role of the SI office and its agenda. "This is an incredible time of crisis and opportunity--a time to tackle our major social problems, [even as] the demand for government services has increased, and state and local budgets are cut."

Ms. Shah hopes to "move our country forward with the power of civic ideas, engaging nonprofits, corporations and social businesses. In the words of President Obama, this is an all hands on deck moment."

The SI Office, a 4-member team that's part of the Domestic Policy Council, was created to signal new special priorities within the White House agenda, the Executive Office of the President and across cabinet agencies. Government, according to Shah, "should play a more dynamic role supporting, not supplant, innovations that use proven models and address our nation's most challenging issues. Social enterprises are concerned with how to make transformative change, using business acumen."

According to a White House press release, "President Obama will ask Congress in the FY2010 budget to provide $50 million in seed capital for a Social Innovation Fund, fulfilling a campaign pledge. The Fund [administered by the Corporation for National and Community Service] will identify the most promising, results-oriented non-profit programs and expand their reach throughout the country."

Regarding the SI fund, Shah stated that "Good ideas outside D.C. wont go unnoticed. We will drive resources to effective solutions, for scalable programs. The SI Fund will provide growth capital for high impact nonprofits, finding ideas that work, and bringing them to scale across the country."

Frankly, it was thoroughly refreshing to hear a representative of a federal office speak with such passion and eloquence. I speak for many others in the audience at Ft. Mason who are still getting used to hearing government staffers who are also visionaries. As Vanessa Kirsch, a plenary panelist from New Profit and America Forward said, "You're so one of us, it's hard to believe! The ecosystem progress is truly amazing. In the past, government wasn't part of the equation, we thought government will surely mess it up. Now government is an ally. It's hard to imagine what the next ten years could be like."

Ms. Shah is interested in working across agencies, collaborating with experts, learning from what others have done, finding promising ideas to scale, and learning about the best thinking on metrics, common language, and how to scale. "Now more than ever need to invest in what works!"

National service is also critical to the both the President and Michelle Obama's agenda. The Edward M. Kennedy Serve America Act tripled the size of AmeriCorps. "It's up to each of us to seize these opportunities," said Shah, "It's up to us to hitch our lives to something bigger than us that is bending towards justice."

Other panelists at the Opening Plenary included Carla Javits, Executive Director of REDF, Andrew Wolk, founder ED of Root Cause, and Vanessa Kirsch, of New Profit.

When asked to help define success for the SI Office, Carla said "12% of the US is still poor. Success would be a falling level of people living in poverty. We have ADD when it comes to solving social problems."

As Andrew Wolk, said, "We need a host of champions at every level of government. We don’t recognize how powerful government is. 38% of our GDP goes to government funded programs, so we must be more productive with these existing resources. Social innovation is a new phase in the role of government. First there was program development, then Reagan-era devolution and outsourcing of government to for-profits and nonprofits. Now government is an enabler, helping social entrepreneurs to grow and scale. Examples of this new type of government innovators include Offices of Social Entrepreneurship in Texas, Colorado and Louisiana."

"We need to spend more time speaking to people in government. More education [of Congress] is required. How is Social Enterprise different from small business, and how can we convince Congress that they should allocate resources to social innovation?" As Ms. Kirsch said, "We have a long row to hoe to make a case for social innovation to folks in Iowa who have few social enterprises to look at as examples."

"There's only so much the Federal government can do," said Shah. "What can we all do at the local level, to create the right environment for social innovation...for for-profits and nonprofits? My Office is not the only solution in the game."