Obama's Office of Social Innovation: What's Next?

Yesterday, Michelle Obama announced the administration's plan to create a $50 million social innovation fund that will finance non-profits or other community groups focused in the areas of education, health care and economic mobility. The First Lady says that the fund will "find the most effective programs out there and then provide the capital needed to replicate their success in communities around the country."

This announcement is the latest in a string of initiatives the Obama administration has put forth to support increasing social services and social entrepreneurship, including the creation of the Office of Social Innovation (headed by Sonal Shah, the former head of Google.org's Global Development Initiatives) and the signing of the Edward M. Kennedy Serve America Act. Moreover, the American Recovery and Reinvestment Act could also spur the creation of social enterprises dealing with environmental, health care and poverty issues.

I believe that the fund has great potential: in addition to injecting capital into ground-breaking non-profits or other enterprises, it will also serve to heighten the visibility of socially-responsible business models, set benchmarks for measuring SROI and hopefully create more efficiency in the sector as non-profits compete for government funds. What remains to be seen is how the administration will define what is innovative, how they will measure social impact and whether it will spur a greater movement in social enterprise creation and investment.

Seth Green has rightly questioned (in late April, before this announcement), could Obama be doing more, particularly in discussing social enterprises within the context of rescuing the economy? Says Green, the founder of Americans for Informed Democracy, "Obama has brought the big banks and financial institutions to the White House to talk about how to responsibly serve Americans, especially those struggling to get by on low incomes. But he has not directly called attention in these conversations to the many responsible social enterprises that are already working on financial education and services for the poor. Perhaps the answer is not only more regulation (as Obama has stressed), but also socially responsible business models."

So could Obama be doing more? I think that one of the best things that the administration can do, beyond giving social enterprises a financial leg up, is to continue to advocate for innovation and help to build an infrastructure that mobilizes people and resources to make change happen--essentially, create an environment in which social enterprises are supported and enabled to become key players in the new economy. After all, after his four (eight?) years in office is over, I would hope to see a strong infrastructure in place that is thriving and deserving of continued national attention.