Social Ventures - The New Profit Model
Social Ventures: The Future of Business in a Human-AI Workplace
As businesses continue to evolve, a unique type of enterprise has emerged that blends the pursuit of profit with a mission for positive social impact: the social venture. Positioned between traditional for-profit companies and charities, social ventures represent a compelling model for the future of work, where transparency, trust, and robust technological solutions are increasingly essential, especially in the context of human-AI interactions in the workplace.
What is a Social Venture?
Imagine a spectrum with conventional businesses at one end, driven primarily by profit, and charitable organisations at the other, motivated by social or environmental missions. Social ventures occupy the middle ground, combining a commitment to social, environmental, or cultural change with commercial business practices. These companies operate with a dual purpose: they aim to be profitable while advancing a specific mission, which is often written up in their founding documents.
For a Lumenai to qualify as a social venture, its mission—often referred to as its "objects"— had to be explicitly stated in its Articles of Association or constitution. This ensures that Lumenai is held accountable to its stated purpose, creating a built-in check that balances profit motives against social goals.
The Role of Accountability in University Incubators
One of the key ways a social venture maintains their accountability is through their affiliation with university incubators, such as Oxford University Innovation. When a social venture is incubated within a university setting, the university often becomes a founding member of the company. This affiliation adds a layer of oversight and support that helps protect, in this case, Lumenai’s mission. Oxford University Innovation, as a shareholder, retains a power of veto over changes to Lumenai´s mission statement, ensuring that the original social or environmental goals are not diluted over time. This governance structure is crucial, especially as social ventures grow and potentially attract engagement of partners whose primary interest may be solely for financial return rather than social impact.
Why Social Ventures Matter for the Future of Work
As workplaces increasingly incorporate AI and other advanced technologies into day to day business processes, there is a growing need to ensure that the implementation of such technology is transparent, trustworthy and committed to ethical practices. In this way, social ventures can act as pioneers, where they are held to account for providing robust and responsible solutions, as defined in their need to balance profitability with a commitment to positive social outcomes, ultimately contributing to a more equitable and sustainable future.
Oxford University Innovation's Approach to Social Ventures
Since launching their support for social ventures in 2018, Oxford University Innovation has been at the forefront of fostering businesses that blend commercial success with social purpose. It´s focus is to support innovation in this dynamic business model, rather than to impose rigid structures, and to ensure these relatively new models can continue to evolve to adapt their strategies without compromising their core mission of maximising social impact and scaling in the most effective ways possible.
Supporting Different Types of Social Ventures
Oxford University Innovation, and other university innovation departments and incubators, supports various social venture models, including Companies Limited by Shares (CLSs) and Companies Limited by Guarantee (CLGs), alongside possibilities to explore B Corporations (B Corps). This diverse support system acknowledges that there is no one-size-fits-all model for social ventures; rather, different structures can be leveraged depending on the specific goals and needs of each enterprise.
Companies Limited by Shares (CLSs)
Companies Limited by Guarantees (CLGs)
Conclusion
Lumenai has incorporated as a social venture, as a company limited by shares, as it believes this model represents a transformative approach to business, and one that aligns with the growing demand for ethical, transparent, and impactful organisations in the workplace of the future. With the rise of AI and other technologies, the importance of these ventures cannot be overstated to ensure we are facing a future of innovation where robust accountability structures and maintaining a steadfast commitment to their mission are key drivers of human and financial profit models. Social ventures supported by incubators like Oxford University Innovation are poised to lead the way in creating a more just and sustainable world, without compromising on profit.
Images reproduced from: https://innovation.ox.ac.uk/about/social-ventures/oui-social-ventures/