Designing Pathways for Change

Why do well intentioned social enterprises fail to achieve their impact goals?

It is common knowledge that many community initiatives, services, and programs geared to solve social problems never reach their full potential. In a study conducted by the Failure Institute on 115 for-profit social enterprises in Mexico who have experienced failure, these are the commonalities that they found:

1. Lack of resources and infrastructure. This is defined by the lack of support funds for social entrepreneurs, as well as ignorance as to how to get funded and the lack of skills to integrate projects to obtain social funds.

2. Context. The environment in which they operate is often not ideal because public policies have not advanced at the same speed as social enterprises. For instance, in Mexico there is no special legal designation for social enterprises.

3. The board of directors. In most social enterprises, the board is constituted of founding partners.…