It’s easy to bemoan the capitalistic bend of the holidays: before the Thanksgiving turkey has settled in their bellies, many Americans are already stamping their feet in lines outside of Walmart and Target, ready to trample over their fellow man for a discounted plasma screen.

But there is a brand of capitalism designed to satiate the better angels of our nature: social entrepreneurship.

For an example of this, take Macy’s “Shop For A Better World” site, which is about as direct a mission statement — and a plea — as one can hope to find.

Browsing the site, you’ll find “Heart of Haiti All-Horn Salad Servers” (for $42), or “Rwanda 10th Anniversary” woven baskets ($50-$60).  This may seem pricey, even for “culturally expressive” gifts, but consider that the artisans (that is, the Rwandans and Haitians making these salad servers and baskets) receive half of the wholesale price and suddenly, that price doesn’t seem so outlandish. In fact, spending that extra $20-$30 could leave you feeling pretty darn good.

And here you have the draw of social entrepreneurship. Because if you or your loved ones are going to be serving salad anyway, why not make sure you’re making the world a better place doing it?

The appeal of social entrepreneurship is that it blends traditional capitalism with solutions to societal problems big and small, like providing water to drought-stricken areas of the world or funding SMEs in Haiti. Through social entrepreneurship, start-ups blend business with creativity and create “shared value” — that is, not just economic value, but value to society.

But as widespread as the practice has become, social entrepreneurship lacks a clear definition. Wikipedia (which itself could be considered a social enterprise) defines it as “the attempt to draw upon business techniques to find solutions to social problems.” So, Kiva, which provides micro-loans to small business owners in developing nations, is a social enterprise, as is Fair Winds Trading, the company that supplies Macy’s with its Rwandan woven baskets, and (according to ashoka.com), Susan B. Anthony is a prime example of a social entrepreneur.

Wait, huh?

If that last example caused you to furrow your brow, you’re not alone. And that may be one of the problems confronting social entrepreneurship: if you can’t really define it, how do you know a good (or poor) example of it? How do you know if it’s working?

One way to look at it is that the consumer isn’t just purchasing a solution, but a story. For example, when you provide a $25 micro-loan with Kiva, not only do you get to personally select your borrower (each borrower is screened by Kiva and has a biography on their site), you get regular updates on how their business is going. It’s not just the appeal of lending money to a needy or deserving, but anonymous, business owner that draws people to Kiva, it’s that you get to ensure Judith from Kenya’s success by helping her buy cereals to sell at the market.

But not only can a good story convince a consumer to open up her wallet, in the case of Sejin Kaleb Oh, founder of Gravity LA, having what he calls a “higher purpose” can keep a business owner motivated.

Gravity LA is a pretty traditional clothing retailer, selling a handful of tees, pullovers, and tanks that are “reputable” and “sweat-shop free,” according to their site.

But click on their “about us” section of their page and you’ll find the following:

“GRAVITY LA was founded on December 21, 2013 to raise money to support those that are willing to leave their comfortable homes and venture out into the unknown and dangerous to bring hope, life, and love to those that are desperately in need of it.”

How do they do this?

According to Oh, they take a percentage of whatever profit they make and donate it to charity.

That’s pretty much it.

And as close as his charitable donations are to his heart, Oh doesn’t set a percentage, so he doesn’t advertise one, and even he says the purpose of the shop isn’t exclusively to raise funds for charity. But what these donations do give him is a cause to answer to when the going gets tough — as it often does for entrepreneurs.

“It’s the story of why I exist, or it’s the story of why Gravity LA exists,” said Oh.

“If you’re just out there for money,” Oh said, “you’re in the wrong business. Because you don’t really see any return on it for years. It’s really that purpose that keeps you going. And really, I don’t know how companies do exist without a story like that or without kind of purpose driving them. I think it’s vital for the life of any business.”

Tucked away in the quiet Arts District of downtown Los Angeles (DTLA) stands the aged brick alleyway of Daily Dose Café, which once served as the primary railroad passage to deliver goods in the city; however, it now operates as a local gathering place for the growing community of entrepreneurs, artists and young professionals settling in the area. A cluster of photographers stand at the entrance of the pathway setting up their camera equipment and preparing for a photo shoot, where a group of twenty-something year olds chat and sip their iced coffees at a nearby table. The image of downtown Los Angeles has radically changed within the last few decades. The Daily Dose Café and Arts District are prime examples of the changing socio-economic and physical landscapes that DTLA has undergone in recent years.

Timeworn structures ranging from the historic  on Broadway to the old, abandoned warehouses and factories that are scattered throughout the downtown area, especially in the Arts District, are being revitalized and transformed into lofts, hybrid industrial (HI) living and work spaces, restaurants, and bars to appease its latest residents. The redevelopment projects and revitalization efforts to repurpose these existing structures and urban neighborhoods would be considered one of the primordial stages of a process known as gentrification.

Certainly there are both positive and negative sentiments that could be shared regarding the issue of gentrification depending on whom you ask. Dana Cuff, a professor of architecture and urban design at the University of California at Los Angeles, has stated that there are two problems that arise when gentrification occurs. The first problem that Cuff highlights would be housing affordability, and the second would be compromising the overall character of an existing neighborhood as a consequence of the method. Cuff has noted that individuals who own property in a neighborhood that is undergoing gentrification will always perceive the process positively, but those whom are renting or looking for new housing will experience the negative effects of the process. The practice of gentrification challenges the concept of social justice within a city amongst its residents. Gentrification leaves the lower-income residents in the city with no other option than to relocate, as they are now unable to afford the higher living costs of the area. As a result, this in turn causes individuals and families to either become homeless or are forced to transfer to higher crime rate neighborhoods that may leave them more susceptible to gang and street violence.

A few positive features often upheld regarding the justification of gentrification are that it can boost a city’s economic standing as well as establish a platform for the city to ultimately flourish. Gentrification generates jobs and property-tax revenue for a city. Cities and public figures are attracted to the concept of gentrification because it can guarantee monetary advances for the city. Loretta Lee, a professor of Human Geography at King’s College, disclosed the appeal of financial gains that gentrification presents for a city. Lee stated that gentrification aids in a city’s effort to garner tourist dollars, new residents and investors in the universal scale of capitalism and competition amongst cities. It has also been noted that gentrification reduces crime rates within cities as greater numbers of law enforcement are usually recruited to generate a sense of safety for its newest residents.

Both the positive and negative effects of gentrification could be experienced extensively within the City of Angels; the redevelopment process has even extended beyond the constraints of the central downtown area. Gentrification is occurring throughout the entire perimeters of Los Angeles County. It can be observed to the north of downtown around Echo Park and Silverlake, to the east around the Boyle Heights area and to the south and west near USC and Koreatown. There have been numerous articles published in recent years that investigate the latest desire that many young Americans possess to move to the golden coast. The New York Times recently published an article stating that many east coast natives are choosing to relocate to Los Angeles for the opportunities that are arising in the business, technology and creative industries. The influx of new residents wanting to settle in Los Angeles can be perceived positively as it will enhance the city’s economic standing, but it begs the question as to where the new occupants will reside. Therefore, there have been public hearings held at the Los Angeles City Hall recently regarding the proposal of investors and developers to begin improvement projects to the area east of downtown in hopes of transforming nonoperational factories and warehouses into hybrid industrial living and work spaces.

According to the demographics provided by the 2013 Downtown of Los Angeles Demographic study, which was published by the Downtown Center BID and the United States Census Bureau’s demographics for Los Angeles County, there are approximately 52,400 individuals that reside in downtown. Of these residents, the average household income figure is $98,700. The 2013 average household income amount is a huge increase when comparing it to the city’s 2007 average household income figure, which was around $54,000 (“Big Numbers and Big Money in Downtown Survey”). These statistics would indicate that neighborhoods in downtown have become primarily middle and upper class individuals and families. Higher housing costs would clearly create a large disparity between the type of individuals that would be residing downtown, and it would force those whom do not make enough income to move out of the area.

Gentrification is a part of our country’s past, present and will undoubtedly continue to be present in its future, and traces of gentrification can be identified in any major city within the United States. While some entities, such as civic leaders, encourage redevelopment efforts and gentrification as a measure to improve a city’s value, there remains a faction of others, such as low-income renters, whom oppose the process. Therefore, as citizens, we must truly evaluate at what cost we are paying for this change and to determine if it is really worth it both socially and economically?

 

Sources:

http://newsroom.ucla.edu/stories/gentrification-in-l-a-isn-t-about-hipsters-becoming-your-neighbors

http://www.ladowntownnews.com/news/big-numbers-and-big-money-in-downtown-survey/article_16ec53d8-cda8-11e0-94dc-001cc4c03286.html