Businesses created with the primary aim of creating broader social benefits bring the self-sufficiency of business and the incentives of market forces to bear on the problems of poverty in a way that neither pure capitalism nor pure charity has been able to match.

These social enterprises deliver benefits in a self-sustaining way by using their revenues to finance activities that generate social benefit. They can also scale to benefit large numbers of people by incentivizing other players in the value chain and by attracting financing from a mix of sources including consumers, franchisees, patient capital funds like Tandem, and commercial sources. These are businesses with the potential to transform markets for social benefit.

Today, 1.1 billion people lack access to clean drinking water. 3.6 million people die each year of water-related disease. WaterHealth International is a social enterprise that uses franchising to deliver clean drinking water to small villages. WaterHealth provides village entrepreneurs with UV filtration technology, which is used to process and sell clean drinking water to remote villages at low cost. Through its network of franchises, WaterHealth provides access to pure and safe drinking water to half a million people in 4 countries.

While some charitable water projects languish because beneficiaries have no money to fix pumps when they break down, WaterHealth technicians are available to help troubleshoot equipment and village entrepreneurs pay for maintenance using the proceeds from their business.

Waterhealth is one of many social enterprises emerging to provide innovative ways of delivering water and sanitation, prenatal healthcare, early education, and agricultural technology to disadvantaged communities often out of reach to conventional businesses.
 

Design for extreme affordability

Description	These businesses are based on a technology or service that has been fundamentally redesigned so that it is affordable to the poor. These products or services tend to be solutions that are both less expensive and more locally responsive.
Business	Baby incubators typically cost $20,000 and require electricity, conditions which cannot be met in many developing countries where 20 million premature babies are born each year. Embrace is a US-based company that has redesigned the incubator as a sleeping pouch that delivers constant heat for 4 hours using a removable heating element that can be warmed up by a fire. The new incubator costs $25 to manufacture.

Cross-subsidization

Description	Cross-subsidization business models use revenue generated from one consumer tier to subsidize the cost of a product or service in another consumer tier.
Business	Dial 1298 is an India-based ambulance service that serves groups at all income levels. The ambulance fee for patients who request to be delivered to private hospitals subsidizes the fee for patients who request to be delivered to government hospitals.

Buy-and-give

Description	The revenues from a for-profit business finance not-for-profit initiatives.
Business	All profits that One Water generates in selling vitamin water are used to fund humanitarian projects in developing countries, such as the installation of water pumps.

Microfranchising

Description	Small franchise businesses that entrepreneurs can start up without a significant upfront investment. These enterprises are often combined with microfinance to help the entrepreneur pay the franchise costs.
Business	VisionSpring provides a “franchise-in-a-bag” for entrepreneurs that travel from village to village testing eyesight and selling low-cost reading glasses.

Inclusive business

Description	Business solutions that include the poor or underprivileged in the production or delivery process.
Business	Amul in India is the largest processor of raw milk in the world, originating milk in 10,000 villages covering 2.2. million farmers who collect a total of 6 million litres a day. The farmers are paid for quality (measured by volume and fat content) at collection points that take the milk to world-class processing units. Nestle replicated this model in Punjab, collecting and processing 1.5 million litres of milk a day from farmers.