Incubator Blogs: Saila Tykkyläinen "A social enterprise can grow and still do good"

"It's OK for a social enterprise to be growth-oriented," says the TREMOR mentor. "The pursuit of growth does not automatically corrupt, and economic growth and social impact can support each other."

Hi, and welcome to another entry in our series of blog posts introducing the mentors behind our incubator programmes. In today's post, we're sitting down with TREMOR mentor Saila Tykkyläinen.

Saila Tykkyläinen, D.Sc., is a senior mentor for the social impact inncubator TREMOR, and one of the founders for Vaikuttava Yritys Oy, also known as Impact Business Ltd. With her strong expertise in economics and social sciences, Saila now serves clients in impact-driven development and impact management. Impact Business' clients include ministries, municipalities, public administrations, and organisations. Saila also works as a mentor and trainer in multiple business accelerators.

Competitive advantage from social impact

Saila became interested in impact-driven development when she was developing the Finnish Social Enterprise brand and realised how much of a competitive advantage companies can gain by demonstrating their contribution as social influencers. Measurement, communication and data collection are important, but impact and impact objectives need to be taken into account when developing a business.

"Social impact means understanding which are the most pressing crises and problems that need to be tackled on a wider front. Of course, instead of tackling problems, you can also focus on solutions and look for positive phenomena and future trends, which you can then go on to reinforce. That is an important starting point. As is shaping your business on its own terms," Saila explains.

Social entrepreneurship is business

A social entrepreneur must know how to do business. Financial and entrepreneurial skills are at the heart of it, since without them there is no social entrepreneurship. Entrepreneurs need investment, advice and understanding and knowledge of what it means to grow a social enterprise.

"It's OK for a social enterprise to be growth-oriented, but it's also OK to remain a local enterprise if the pursuit of growth doesn't fit with your own thinking. However, the pursuit of growth does not automatically corrupt, and economic growth and social impact can support each other," Saila continues.

Creating impact is about helping others

The articles of association and shareholders' agreement of a social enterprise include a clause on limited distribution of profits, though in practice, few companies distribute more than 50% of profits to their shareholders. What matters more is how the incoming profits are spent. Impact Business helps smaller operators by producing videos and tools for impact assessment and by providing pro bono consulting services.

"Today's business and startup world is full of talk about changing the world — talk which often ultimately rings hollow. What remains to be seen, then, is who is actually passionate about changing the world, when most seem to only embrace the rhetoric of changing the world without actually creating any real impact. This stuff isn't reflected in profit margins or dividends. But what defines us a social actor is how we use our own income streams for the benefit of society or the environment."

As we're talking with a social entrepreneur, we have to ask: what is the social challenge you would like to tackle right now?

"At the moment, it's definitely the destruction of nature, climate change, and climate anxiety, which will worsen social crises. We all have a responsibility to try to address these issues."

As a mentor, Saila hopes for bold ideas from the TREMOR participants:

"Bold, and I mean bold in terms of their social impact. The type that will disrupt the sector. The transformative potential of social enterprises is that they challenge existing businesses - they show that you can do business this way, that everyone can. The point is not just in having one impactful company, but in setting examples of how to do business differently and in ways that are better for everyone."