Cartography: Germany I

Cartography [n.]: Mapping, review

My trip through Germany in April 2015 gave me the unique opportunity to speak to eight support organizations in all four corners of the country: North, South, East and West. Six of them focus their activities on Germany and selected cities within (Social Impact Labs, Heldenrat, Impact Hub Berlin), two work with social entrepreneurs internationally (Yunus Social Business, The DO School), and Social Entrepreneurship Akadamie in Munich caters to both national and international social startups offering different programs.

Local & national programs

Social Impact Labs are very similar in the services and benefits they provide as part of their support program Social Impact Start. Locally, though, each Lab has strong local partners and runs pretty self-sufficiently. I wonder if any plans are in place to make use of their Lab-network across Germany (not to mention their program-partnerships with Impact Hub Zurich and Vienna!). The Impact Hub network sets a great example for sharing knowledge and experiences among their Hub facilitators and members (though I still don’t exactly know what that looks like behind their closed doors. Did my Honorary Membership invite get lost in the mail?).

Though still young, Impact Hub Berlin is gaining a lot of traction and seems to have found their niche in the German capital. Their new space is great, no question. Let’s see what kind of programs Leon ad his team manage to line up in the months to come and I shall check back in to see how things are going.

Impact Hub Berlin 2

Impact Hub Berlin

When I first started my research into the field of social venture support organizations, I insisted on the category of pro-bono consultants solely because I had heard of Heldenrat. Strictly speaking I am looking at structured support programs for social entrepreneurs and one could argue that they only partly meet this definition. At the same time, they have a process in place of helping out struggling social entrepreneurs and charities. They are able to fill gaps in the support landscape and connect startups in need with relevant support organizations. I have tremendous respect for the team of volunteers around Tom and Birgit for devoting their free time to being volunteer advisers for startups and nonprofits in need.

International Programs

As far as internationally-oriented programs go I spoke to Yunus Social Business, the DO School and Social Entrepreneurship Akademie. Yunus Social Business is headquartered in Frankfurt and manages their core operations from there. There was little opportunity for insights into their programs at work which take place in seven countries around the world. However, their attempt of using their participants’ feedback to inform their program is remarkable even without my field visit. This seems like an easy and obvious mechanism for many of us who I’m sure have at least heard of the Lean Startup Approach, yet Yunus Social Business was the first social venture support organization who was able to make concrete statements about the effectiveness and relevance of their training schedule and services by gathering feedback from their participants.

Starfish-24-1700x945

DO School Fellows of the Green Store Challenge

While working at the DO School over the period of 18 months I was lucky to work closely with several cohorts of social entrepreneurs. Their one-year program goes beyond supporting them in developing a plan for a social venture (during their ten weeks in Hamburg) and implementing it (ten months after) in their home communities. A lot of work within the program is dedicated to ideation, facilitation and developing participants’ personalities. After all, for the ten weeks in Hamburg, they live and work together 24/7. It’s fair to say that the dedication of Romy and her team make the difference in this program.

How many #SocEntSupport programs assess their relevance and effect through participant feedback? Click To Tweet

Social Entrepreneurship Akademie at the opposite (South) end of the country sets a good example of building up strong partnerships to secure the financial sustainability. Speaking to Kristina I realized what energy (and philanthropic capital) mutually-beneficial partnerships can bring to the table. With their active engagement with the European Venture Philanthropy Forum and the Global Social Entrepreneurship Network I think of Social Entrepreneurship Akademie as one of the agenda-setters in the field in Germany, and Europe.

 

Social Entrepreneurship Akademie

I met Kristina and Dominik from Social Entrepreneurship Akademie at the GSEN Learning week in London in January 2015. We had in fact all worked in the German support sector in 2013/14: Kristina and Dominik in Munich (South) and me in Hamburg (North). We had to take a trip to London to connect in person, months after I had left Germany to go work on Social Venturers.

Half a year in we developed long-term strategies to secure our financial sustainability. Click To Tweet

The Social Entrepreneurship Akademie was founded in 2010 as a joint cooperation of Munich’s four big universities (LMU, TUM, University of Applied Sciences, and Universität BW). Stiftung Mercator and Stifterverband für die Deutsche Wissenschaft provided initial funding for the first two years that helped set up Social Entrepreneurship Akademie; it is now self-financed. “The idea of the project was not to establish a program only for the duration of the funding. Half a year into our operations we started developing long-term strategies to secure the academy’s financial sustainability. As an educator and enabler we wanted to “walk to talk” and create something that would last and make a meaningful contribution to the social entrepreneurship landscape in Germany”, says Kristina.

Academy Programs

And indeed, based on their understanding as an educational institution and close affiliation with higher education institutions in Munich, they offer a variety of training and support programs for aspiring social entrepreneurs.

In 2011, Social Entrepreneurship Akademie first offered their two-year qualification program in social innovation. During the first year, up to 25 participants, mainly students, learn the theory behind social entrepreneurship and tools needed to turn promising ideas into practice. During the second year, mentors support them in implementing their ideas. Best I can tell, participants are motivated, and most importantly, successful. To date, the academy has worked with 24 teams through their Social Innovation Program; 50% of which have continued their social venture. “Demand for the program has been great; we are currently scaling a short version of the qualification to a European level. Supported by KfW Foundation and together with local lecturers and social entrepreneurs we will implement a two-day seminar with around 50 universities across Germany and Europe.”, Kristina explains

IMPACT:werkstatt on social design copyright: Social Entrepreneurship Akademie

IMPACT:werkstatt on social design
copyright: Social Entrepreneurship Akademie

In cooperation with the university-based Entrepreneurship Center in Munich and – most recently SAP Foundation  –  Social Entrepreneurship Akademie runs the Global Entrepreneurship Summer School. Each summer, students from around the world come together in Munich to work on their social business ideas to address pressing global challenges. Central topics in recent years were Waste (2014), Re-Thinking Education (2013), People on our planet – Challenges of the future (2012) and Water (2011) (for a full list, visit the Review tab on www.globalsummerschool.org). 35 students from all over the globe develop their business idea during business planning workshops and sessions specific to their central Challenge. The ten-day summer school in Munich culminates in a final pitch event during which all teams present their concepts in front of an audience of 200 educators, decision makers, investors and guests. Should you find yourself in Southern Germany on September 24, 2015 – get your free ticket here and join this year’s celebration!

Thanks to cross-sector partnerships @SEAkademie offers 4 #SocEntSupport programs. Click To Tweet

In collaboration with the Vodafone Foundation Germany Kristina and her team annually organize Act for Impact – a competition for the best entrepreneurial ideas to promote social mobility in Germany. Between February and April, teams apply with their idea for a social venture that fosters education and integration. 15 teams move into the second selection round out of which five finalists get to pitch their idea in front of a jury in June. The winner receives EUR 40.000, including business development coaching through the Social Entrepreneurship Akademie to take their idea further. The most recent winner was “Hotel Utopia” a hotel in Berlin offering job training and employment for refugees in Germany.

Beyond that, the Social Entrepreneurship Akademie offers one-on-one coaching for social startups, and workshops/seminars covering anything from “Introduction to Social Entrepreneurship” to “Financing social business models” and “Demonstrating your impact in accordance with the Social Reporting Standard”.

Networks & Partnerships

Clearly, Social Entrepreneurship Akademie is keeping pretty busy offering such a diversity in programs. I ask Kristina what makes their approach different. “We work very closely with universities and our target group is not necessarily founders. We want to get students from all disciplines excited about social entrepreneurship which is why we offer so many different formats.”

What about partnerships? “As a network organization we value and invest in strong, long-term and mutually beneficial partnerships, be it with foundations, universities or even companies. Receiving funding for one of our programs of course is great. But we can do more by asking partners what we can do for them. We believe that creating this kind of shared value is the foundation for a successful and sustainable collaboration with any partner. Of course we don’t lunge into three-year partnerships straight away. We develop a smaller scale project to test-drive the collaboration and see how it goes for both sides. If we see potential, we dream big and offer a big exciting project, with all the risks and uncertainty. So far, it has paid off.” says Kristina.

3 generations of winners of Act for Impact: App Camps (2014), Hotel Utopia (2015) Hero Society (2013) (left to right) copyright: Social Entrepreneurship Akademie

3 generations of winners of Act for Impact: App Camps (2014), Hotel Utopia (2015) Hero Society (2013) (left to right)
copyright: Social Entrepreneurship Akademie

Social Entrepreneurship Akademie is part of the Global Social Entrepreneurship Network and play an active role in organizing the annual conference of the European Venture Philanthropy Association. “I don’t always have the time and capacity to dive in and make maximum use of everything that is offered.” claims Kristina. “But it’s important to collaborate with other support organizations. We have an elite of big support organizations and many great smaller players that do a lot of grassroots work. Aspiring social entrepreneurs in Germany should have little trouble finding the support they need in the early stages of their venture development. In fact, some social start-ups move from support program to support program without ever really taking off. I think we as enablers should make an effort to align our activities to offer relevant and tailored support. That way, we would avoid competition among ourselves and put impact first again.”

Early-stage #SocEnt in Germany should have little trouble finding the support they need. Click To Tweet

I don’t know if there is anything left for me to say. I think Kristina hit the nail on the head. With a continuously growing number of incubator, accelerators and other support programs for emerging social entrepreneurs I have been wondering what dynamics are at play once the support market becomes as saturated as it is in Germany. Maybe all support organizations enter into fierce competition for funding and the best applicants, maybe they start to coordinate and collaborate to build a strong ecosystem and support pipeline.

twitter@SEAkademie

seakademie.de

 

Field study: Germany

Field study [n.]: Preliminary research

First things first: Apologies for the excessive use of footnotes in this post. I want to give credit where it’s due and not get into trouble for plagiarism. I worked through a number of studies – some of which are great to dive deeper into the topic – and have summarized their main points. You will find MY observations at the end of this series in the Cartography post.  

My trip through the Netherlands and Belgium was followed by a month in Germany which gave me some time to freelance and the opportunity to visit support organizations in Frankfurt, Berlin and Hamburg. Having worked in the German social enterprise support sector, I had to challenge myself to step out of my preconceptions and try to see the sector for what it is.

I was astonished to find how much research had already been done on social entrepreneurship in Germany – it was almost daunting to even start diving into the topic for fear of what I would find, and how much. Here are some key insights from the studies I looked at:

Social Entrepreneurship is not new to Germany, some #SocEnt are as old as 30 years. Click To Tweet

… but they often don’t identify as such. The five most relevant social issues in Germany – according to a SEFORÏS report1)Wolf, Myriam (2014). The State of Social Entrepreneurship in Germany SEFORÏS Country Report. (based on another study by the German Ministry for Education and Research2)Müller, Susan, Dominik Rüede, Kathrin Lurtz, Hartmut Kopf, and Peter Russo (2013). Deutschland 2030: Herausforderungen als Chancen für Soziale Innovationen. World Vision Center for Social Innovation, Wiesbaden.) are

  1. Labor market: unemployment and skill shortage
  2. Education: coupling of socio-demographic background and level of education
  3. Income and wealth: increasing division between rich and poor, failure to generate income to secure existence
  4. Environment: Coupling of resource use and economic growth
  5. Health: healthcare provision (aging society) and lifestyle diseases.

Unexpected findings

Apparently, strong welfare organizations make it tricky for social entrepreneurs to find their niche and establish themselves as a unique field. It’s almost like the “market for addressing social issues” is already among organizations like Deutscher Caritasverband (German Caritas Association), Arbeiterwohlfahrt (workers’ welfare association) or Diakonie, making it difficult for new-comers such as social entrepreneurs to position themselves and try out new approaches.3)Wolf, Myriam (2014). The State of Social Entrepreneurship in Germany SEFORÏS Country Report.

Risk-aversion of Germans: “German society tends to be risk averse. Risk averseness is one of the major cultural factors impeding entrepreneurial activities and ultimately also influencing availability of funding for social enterprises.”4)Brixy, Udo, Rolf Sternberg, and Arne Vorderwülbecke (2013). Global Entrepreneurship Monitor (GEM) – Länderbericht Deutschland. Hannover. I will add that in former East Germany – having been born and bred there myself – individual behavior was not necessarily encouraged. Under socialism, the market was heavily (if not exclusively) regulated by the state – going the extra mile didn’t pay off in most cases. During the first 19 years of my life, I didn’t know a single entrepreneur.

Under socialism, entrepreneurship was not encouraged. Does it show in today's #SocEnt sector? Click To Tweet

I believe this mindset is still deeply rooted in East-Germans and hampers their entrepreneurial spirit. I wouldn’t assume this is true for all Germans that lived on the Eastern side of the wall, but it is one influencing cultural factor.

Other Influencing Key-Factors

According to the Global Entrepreneurship Monitor 2013, Germany ranks high in terms of physical infrastructure, government programs and protection of intellectual property – factors which create a nurturing environment for entrepreneurs – while ranking low with respect to entrepreneurial education in primary and secondary schools, labor market conditions, and knowledge and technology transfer – factors that don’t create this kind of favorable environment.5)GEM. Global Entrepreneurship Monitor 2013. Social enterprises can choose from over 20 different legal forms within the German system, none of which is exclusively dedicated to, nor apparently suitable for, social enterprise.6)Wolf, Myriam (2014). The State of Social Entrepreneurship in Germany SEFORÏS Country Report. Instead, social enterprises register as

  • Stiftungen (foundations),
  • Vereine (voluntary associations),
  • GmbHs (limited liability companies) and
  • Genossenschaften (co-operatives)7)Zimmer, Annette & Bräuer, Stephanie (2014). The Development of Social Entrepreneurs in Germany. Westfälische Wilhelms University, Germany.

which makes a head-count very difficult. There also is the legal form of a charitable limited liability company (tax exempt status) which is not mentioned in this study. In 2011, Wissenschaftszentrum Berlin counted

  • 580,000 voluntary associations
  • 18,000 foundations
  • 9,000 limited liability companies with tax exempt status, and
  • 8,000 cooperatives in Germany.8)Priller, E., Alscher, M., Droß, P. J., Paul, F., Poldrack, C. J., Schmeißer, C., & Waitkus, N. (2012): DritteSektor-Organisationen heute: Eigene Ansprüche und ökonomische Herausforderungen. Ergebnisse einer Organisationsbefragung. Wissenschaftszentrum Berlin für Sozialforschung. Berlin.

This leads to a total number of 615,000 organizations in the Third sector. Not bad for a country with a population of 80 million. However, the lack of a separate legal form for social enterprise results in them remaining un-differentiated from other third sector organizations such as charities or even parental or neighborhood initiatives. To be honest, this troubles me.

How important is a legal form for #SocEnt in Germany? Click To Tweet

On the one hand, this lack of differentiation makes it difficult to promote the social enterprise concept in an environment that is already heavily influenced by strong welfare organizations. On the other hand, I argue that legal forms don’t make social enterprise. I believe that mission and impact will dictate legal form, not vice versa. Thoughts anyone?

Scheuerle & Bauer give an insight into financing mechanisms of social enterprise in Germany arguing that certain issues lend themselves more to earned income generation ( e.g. related to environment) than others (social services).9)Scheuerle, Thomas, and Albrecht Bauer (2013). Social enterprises as an investment? Frankfurt.

Financing

Financing structure of social enterprises in Germany. Source: Scheuerle, Thomas, and Albrecht Bauer (2013). Social enterprises as an investment? Frankfurt.

 

What social enterprise support?

None of the reports I studied mentioned support organizations. The only reference to our work, my dear readers, is the last sentence of chapter 4.2 in the SEFORÏS study (2014, p. 11): “Entrepreneur support models, however, only recently started to emerge in Germany but are perceived as highly important for the further development of social entrepreneurship.” Amen. Though I wonder how the authors define “recent”. After all, Germany has a number of strong players in the support sector for social entrepreneurs (swing over to The Changer via google translate for a longer list):

Reason enough for me to visit some of them and learn more about their different approaches to supporting social entrepreneurs around Germany and abroad.

References   [ + ]

1, 3, 6. Wolf, Myriam (2014). The State of Social Entrepreneurship in Germany SEFORÏS Country Report.
2. Müller, Susan, Dominik Rüede, Kathrin Lurtz, Hartmut Kopf, and Peter Russo (2013). Deutschland 2030: Herausforderungen als Chancen für Soziale Innovationen. World Vision Center for Social Innovation, Wiesbaden.
4. Brixy, Udo, Rolf Sternberg, and Arne Vorderwülbecke (2013). Global Entrepreneurship Monitor (GEM) – Länderbericht Deutschland. Hannover.
5. GEM. Global Entrepreneurship Monitor 2013.
7. Zimmer, Annette & Bräuer, Stephanie (2014). The Development of Social Entrepreneurs in Germany. Westfälische Wilhelms University, Germany.
8. Priller, E., Alscher, M., Droß, P. J., Paul, F., Poldrack, C. J., Schmeißer, C., & Waitkus, N. (2012): DritteSektor-Organisationen heute: Eigene Ansprüche und ökonomische Herausforderungen. Ergebnisse einer Organisationsbefragung. Wissenschaftszentrum Berlin für Sozialforschung. Berlin.
9. Scheuerle, Thomas, and Albrecht Bauer (2013). Social enterprises as an investment? Frankfurt.