Social businesses function in most ways like forprofit businesses, yet since the social impact is the primary purpose of this business, all profits have to be reinvested into the business (i.e. no dividends are paid out to the owners) or are used to start new social business to increase the impact of the organization.
A social enterprise or social business is defined as a business that has specific social objectives that serve its primary purpose. Social enterprises seek to maximize profits while maximizing benefits to society and the …
Profits realized by the business are reinvested in the business itself (or used to start other social businesses), with the aim of increasing social impact, for example expanding the company’s reach, improving the products or services or in other ways subsidizing the social mission.