Social investment markets are growing around the globe and - as efforts like the G8 Social Impact Investment Taskforce indicate - they are increasingly receiving high-level support. Many believe that social enterprises - recipients of social investments - are important contributors in the fight against poverty, but unlike with NGOs and other types of organizations, evidence backing this assumption has been scarce and largely anecdotal.
We recently completed a large-scale study of investment in social enterprises, based on a survey of 36 social investors and 286 social enterprises from Colombia, Mexico, Kenya, and South Africa. Our findings generally support the idea that social enterprises can have a positive impact on poverty reduction. But they also reveal some caveats, which have led us to derive concrete recommendations for action.