THE BLOG
11/19/2013 03:07 pm ET Updated Jan 23, 2014

Social Entrepreneurship and Social Impact

Please stop telling people that your EdTech venture is about bridging the achievement gap when it's really not. The very nature of education is learning and your venture facilitates learning so you are creating social impact, right? Of course not! Middle and high-income students already learn at high levels, providing them with an alternative way to learn at a high level solves no pressing societal issue. It may make the founders of an EdTech venture rich, ensuring they themselves will never face poverty, but does it really do anything to address the lasting achievement gap? To what extent does it actually widen the gap?

It was my first visit to the Ashoka Foundation in DC where I learned of the term social entrepreneurship and immediately fell in love with the concept. The foundation illuminated the phenomenon of people solving intractable social problems using unorthodox tools such as for-profit ventures. A non-profit's operations are forever bound to donation seeking whereas a for-profit sustains itself through the value it creates which can be both social and economic. The self-sustaining characteristic of for-profits also lend themselves to scale. Since DC, I have been introduced to some extraordinary communities of young change makers who are using the social entrepreneurship vehicle to truly tackle issues such as poverty, education, and violence.

It wasn't until I started my own social venture that I realized there are numerous people in the "social impact" space that actually care little about social impact. Social impact is hot right now. There are abundant resources, accelerators, institutes and funders that are investing in this field and there are plenty of opportunities to become wildly successful. This is especially so within Educational Technology. Say you create iOS education app number 2,200. Your team builds a talking hippo that teaches kids grammar and plays games with users as they learn. The user interface for your Hippo App is innovative and your monetization model is even more creative because it doesn't rely on ads. Johnny The Hippo App reaches 50,000 users and McGraw Hill acquires the venture for 10 million bucks. Has social impact been made?

To understand the potential social impact of a venture, one has to dig, not even that deep, at the intentions of the founders. There are three types of founders: the Impact Driven, the Agnostic, and the Cash Driven. The Impact Founder is obsessed with ameliorating a societal issue. They might relate to the struggle of fellow poor students, have worked in those afflicted communities, or are just outraged by an injustice. Every decision the impact founder makes comes back to these communities. In this context, Johnny The Hippo would be grounded in the research about what moves the needle on student achievement for low-income minority students. From the beginning, this venture team would be finding ways to pilot, test, and roll out their product in at-risk schools and communities, however difficult. The Impact Founder also relentlessly measures their venture's impact both quantitatively and qualitatively, ready to pivot at any moment if the intended impact is not being made. Furthermore, this founder is probably not seeking acquisition or an IPO because they fear the communities they care about will never be served best by money driven stockholders.

The Agnostic Founder, on the other hand, creates a product that could be useful in disadvantaged or advantaged communities but lets the venture follow the path of least resistance towards monetary success. Their Johnny The Hippo app may be based on the research about effective literacy practices but they may decide to test it in the suburbs where its easier to implement a pilot. Their app could dramatically increase reading gains for inner-city students but they accept a contract from a large district in the suburbs, investing their scarce time, capital, and energy into a "successful" product. This founder would let McGraw Hill acquire their venture with the knowledge that McGraw may have purchased their venture just to shelve it and keep it off the market.

The Cash Driven founder creates Johnny The Hippo, knowing from the start, that it is not grounded in any research about literacy instruction. The product is targeted to middle class moms that love the virtual badges it awards their child that can be touted on resumes. This founder knows that there is a gold mine in EdTech, they have a great team, and a fresh idea. More power to the Cash Founder as there is nothing wrong with being this person and monetary success is respectable, just don't fly the social impact flag while you are doing it.

If you don't know what kind of founder you are, ask yourself, is this venture grounded in the literature on what impacts student achievement? Does your venture target an underserved or at-risk population? What strategies are used to ensure that this market is served by your venture? If your venture is acquired, how will you ensure that impact continues to occur after you are no longer on the team? EdTech is a field that has the potential for awesome disruptive change to the achievement gap and to upend antiquated systems of inequality. Know if the EdTech you support is geared towards that purpose.